Cookeville Sees Increase in Stop Loss Insurance Premiums

Cookeville will see an increase of some 90 thousand dollars in its stop loss insurance premiums for the new year.

City Manager James Mills said with several employees dealing with major health issues, the city’s back is against the wall.

“There is some risk here, some gamble that you would see with any insurance,” Mills said. “We’ve evaluated all the different options we had and we believe this is the best path forward for us.”

Stop loss insurance is a product that would provide the city with protection against large or unpredictable losses. Typically employers who self-fund employee benefits will use a stop loss insurance program, and Cookeville has used the Self Insured Health Plan since 1998.

The current provider, BlueRe, was the only provider that quoted for Cookeville. The company asked the city for a conditional laser on an employee who is facing a transplant. The city would be responsible for $500,000 for that employee’s coverage. Employers typically implement lasers when an individual has pre-existing conditions or illnesses that will cost more to cover. In renewing the contract with BlueRe, those insured by Cookeville would see a 26% increase in premiums.

Finance Director Brenda Imel said without the laser everyone’s deductible would go from its current $60,000 annually to over $100,000 annually, and premiums would increase 72 percent.

“We’re proposing the same coverage–the same $160,000 for individual deductible, the same $60,000 aggregating deductible, and the increase in premiums are going to be about $90,000 for a total of $436,000,” Imel said.

The city’s current contract expires June 30.