Published January 03, 2010 12:41 am – Peru town officials agreed to increase the buyout rate for town employees who use coverage from a spouse’s plan from $2,000 to $2,500, citing a need to stay competitive with other buyout programs.
Peru increases buyout rate for insurance coverage
Peru hopes higher rate will encourage workers to opt out
By JEFF MEYERS
Staff Writer
<!–
Kenya minister speaks about ministry
A minister from Kenya was in Enid talking about his ministry.
By Robert Barron
CNHI News Service
–>
PERU — Town officials have agreed to increase the buyout rate for town employees who opt out of the town’s insurance coverage in favor of a spouse’s plan.
Typically, employees who chose not to use the Town of Peru insurance plan and were covered by a spouse’s plan received a $2,000 annual buyout payment.
Officials moved during a recent special meeting to increase that buyout to $2,500 annually.
“The buyout is used to encourage people to take another source of insurance,” said Town Supervisor Peter Glushko. “We’ve been low on our insurance buyout and have not been competitive with other buyouts available to some of our employees.”
At least three employees were considering picking up the Town of Peru insurance coverage because buyouts with their spouses’ companies offered a better option, he added.
“Our buyout rate has been $2,000 for three or four years and has not kept up with anyone else. Increasing the buyout saves us much more money than if an employee takes up our insurance.”
Family coverage for each employee is about $11,000. There are currently five employees who have insurance through a spouse’s plan and could switch over to the Peru plan.
“We’ve been slow to make adjustments (to the buyout rate) and thought it was a good time to do it now,” Glushko said. “Now, it is an act of good faith, but we will be getting it into the employee handbook and will consider another adjustment next year.”
The town also recently switched insurance carriers, opting not to accept a 30-percent increase in rates through Empire in favor of new coverage through Excellus.
With the new coverage, the town will no longer have a Health Reimbursement Arrangement, but employees will be able to contribute to a Flexible Spending Account for medical needs beyond insurance costs.
“We couldn’t continue with the old insurance,” said Glushko, who noted that the town held informational meetings with employees to discuss their insurance options.
“Going with Excellus will help us keep the costs down.”
E-mail Jeff Meyers at: jmeyers@pressrepublican.com
