City of Decorah will be hit with an 8.1 percent increase in health insurance premiums

The cost of providing health insurance to City of Decorah employees is going up.

City Administrator Chad Bird says the city's insurance carrier has notified the city of an 8.1 percent increase in premiums for the coming year.  Bird says the city is considering a couple of steps which could reduce that increase, however.

The city purchases health insurance with a high deductible, then self-insures the difference between the cost of the coverage and the level of insurance it provides to its employees.  The system saves money for the city.  Bird says the city might increase the overall policy deductible again, so that it is self-insuring a higher figure.  The move might reduce the increase in health insurance costs to 1.7 percent instead of 8.1 percent.  Included in the change might be a system to incentivize city employees to use generic prescription drugs.  City employees would not see any increase in their out-of-pocket maximum.