Facing budget restrictions, City of Marfa selects new health insurance for employees

MARFA — In light of budgetary concerns and rising health insurance costs, Marfa City Council last week voted to replace its current plan for city employees with a more frugal option, which will implement higher out-of-pocket costs for workers.

The new plan will see higher out-of-pocket costs for employees, with an increase in deductibles, from $500 to $1,000 for in-network providers and $1,000 to $2,000 for out-of-network providers. It’s an unfortunate byproduct of the switch, acknowledged City Manager Mandy Roane. But keeping the current plan would place a financial strain on the city budget, she said — that would have meant a cost increase of around $125,000, roughly 30% costlier than in the previous fiscal year. 

“I think sticking with the current plan we have is probably not feasible,” said Roane at Thursday’s meeting. “$125,000 is a lot of money to come up with.”

The new plan, meanwhile, would be roughly half the price. While the new plan means deductible increases for employees, coinsurance would remain the same, and co-pays would remain at $30 for office visits and $60 for specialists. 

Cherry Torres, benefits coordinator for the City of Marfa, explained to council that the cost of insurance was increasing as city employees aged and required more medical care — not just City of Marfa employees, but employees of other cities within the district with whom Marfa is grouped.

“Number one is our aging workforce,” Torres said. “We have a good retention rate with our employees, but most of us are getting older.” The second primary factor, she explained, was a roughly 80% increase in cancer treatment among employees in the district pool (the sharp increase was due to a lag in cancer diagnoses during the pandemic, she said).

Torres, while acknowledging the city’s current health insurance was the “top tier” plan offered, presented Council with four options that would be more affordable for the city. Weighing costs and benefits, Council ultimately voted for the plan they felt would have a minimal negative impact on employees while saving the city money.

“[The new plan] has a minimal increase in out-of-pocket and deductible costs for employees without too large of an increase for the city,” Roane explained. “Instead of a 30% increase for keeping this year’s plan, we are looking at 16.5%.” 

The increase in insurance costs for Marfa are in line with predicted national trends — premiums have been projected to increase nationwide for the coming fiscal year due to inflation and a rise in post-COVID doctor visits.