Setting parameters for postemployment, two-year health insurance plans will enable longtime employees to know what they will receive from the village, the Mackinaw City Village Council decided at a work session Monday, November 23. The framework discussed may result in coverage that is lower than what retiring employees received in the past, which was roughly 95% to 100% of premiums.

Village President Jeff Hingston asked council members to give ideas on what they thought would be fair two-year retirement coverage for two people. He suggested a 95% coverage rate of premiums capped at the time of retirement, which would decrease to a capped 50% if eligible employees did not seize the deal in the first year of its passage. Employees would have to work for the village for at least 30 years to be eligible.

In other words, if the framework was passed January 1, eligible employees who could retire would have until January 1, 2011, to receive 95% capped coverage. Accepting the year afterward would result in 50% capped coverage.

Three employees currently have worked for the village for 30 years or more.

Trustee Belinda Mollen proposed a three-year-tiered variation of Mr. Hingston's proposal. The first year when parameters were set, eligible retirees would receive 95% capped coverage, the second year would be 80% capped, and the third year would be 50% capped. Trustee Richard Perlick said he approved of Mrs. Mollen's modification, explaining it would give time for long-time employees to receive post-employment health benefits similar to what their previous co-workers obtained. Younger workers would also understand what their retirement health insurance would be like in the future.

Trustee Paul Michalak agreed with a three-year-tiered structure, but said setting an absolute dollar amount would be a better idea. He explained, in the worst-case scenario, insurance premiums could increase so high that a 50% coverage rate could cost the village more for one year than a 95% rate years before. Trustees Matthew Yoder and Steven Celez both agreed with a three year tier system and Mr. Celez said he liked the idea of setting a specific dollar amount.

The council was concerned about the amount of money that would be spent on post-employment health benefits. The village currently pays health benefits for 24 working employees, which costs roughly $336,000 a year, Mr. Lawson said. The village is also paying for a two-year post employment health benefit package at a cost of between $11,000 and $12,000.

The discussion was spurred by the upcoming retirement of Mackinaw City police officer Robert Desy, but the village also has three other workers with more than 30 years of experience who could retire.

The difficulty of setting framework for a two-year post-employment plan is that the council would be at the mercy of the economy, Mrs. Mollen said.

She stressed retiring employees should know exactly what they can expect in terms of postemployment health care when leaving the village. While the village currently grants postemployment health care to eligible employees at its discretion, trustee Janelle Bancroft said that practice has its own pitfalls. In some cases, granting retirement health care to one employee but not to another could appear discriminatory.

Since the meeting was a work session, no action could be taken on the matter. The council plans to submit ideas to the finance committee at the next village council meeting.