The Tonawanda Common Council on Tuesday night unanimously approved several additions to the city's employee manual on health insurance coverage.
City Treasurer Joseph Hogenkamp said that the changes make the city's regular administrative work official and that no employees will see any changes to coverage. The new policies came as a result of a state audit of the city's employee coverage.
"There were a couple of issues pointed out, and we're addressing those issues," Council President Carleton Zeisz said.
Those who may see changes to their coverage are former employees of the city. If an employee chooses to leave the city work force, he is eligible to continue health insurance under COBRA by paying premiums for 18 months. Various circumstances allow the employee to extend the coverage past that period.
The new written policy allows for stronger enforcement of the deadline, a flaw pointed out by the state audit. Hogenkamp said the change will only affect a handful of former employees.
But the city still faces high health insurance costs every year, thanks in part to a number of previous union contracts that provide every unionized employee of the city complete coverage after retirement. Currently, the City of Tonawanda spends more money on coverage for retirees than current employees, spending $1.4 million this year of its $2.6 million health insurance budget on former city workers.
In recent years, the city has worked to control its health insurance costs, even as premiums increase every year. City officials negotiated union contracts to eliminate the complete retired coverage benefit for new employees.
The city also made a major move this year to get a significant amount of its retirees to enroll into the Medicare Advantage plan to allow Independent Health to manage Medicare coverage, allowing for lower premiums and co-payments in coverage. The new program, which went into effect Sept. 1, is expected to save the city $150,000 to $200,000 a year.
"It's a win-win-win for everybody involved," Hogenkamp said.