The City of Omaha has negotiated to bring all city unions under a single health insurance plan for all covered city employees.

Mayor Jean Stothert announced last week that she accomplished her administration’s long-term goal of moving to a single health insurance plan, with the exception of rank-and-file firefighters who are covered under a plan managed independently of the city.

Beginning Jan. 1, 2020, all other city employees will be covered by a high-deductible health plan.

“Employee health care is one of our most significant expenses,” Stothert said. “The single plan we now offer will result in lower premium costs and a savings to our taxpayers.”

Many private employers have moved to high-deductible plans that typically offer lower premiums but leave covered employees paying for most costs other than preventative care until they reach their deductible. Plans are often paired with health savings accounts, which help with increased out-of-pocket expenses than traditional preferred provider organization plans. By making the cost more transparent, high-deductible plans are intended to discourage unnecessary trips to the emergency room and spending on unnecessary medical procedures.

Omaha city employees will receive an annual contribution to their health savings accounts to help pay for additional out-of-pocket costs. The HSA contributions vary by bargaining unit.

Stothert said she set two long-term goals as chair of the City Council negotiating committee in 2011, prior to running for mayor. The goals were reversing the insolvency of the city’s pension funds and bringing the unions together under one health plan.

“We achieved the first goal with unprecedented pension reform during my first term as mayor,” Stothert said. “In my current term, we achieved the second goal. Beginning next month, the City will – for the first time in decades – administer only one health care plan.”

The city previously administered about 30 different health insurance plans for current and retired employees. Officials project $1.8 million in savings in 2020 as a result of moving to the new plan, with additional savings in each subsequent year.

In 2018, the Omaha Police Officers Association was the first bargaining unit to move to the new plan, which became the model for other unions, Stothert said in a news release. Police management, the civilian bargaining units (Local 251, CMPTEC, Functionals and AEC) and fire management all ratified contracts with the high-deductible plan.

The city firefighters union, IAFF Local 385, administers its own health care plan, into which the city pays monthly premium contributions. Last year, Stothert agreed to a five-year extension of the Omaha Firefighter’s Health Care Trust, which was first created in 2015. The agreement limits the city’s share of premium increases through 2023.

The city continues to provide health insurance to retired employees until they are eligible for Medicare at age 65. The city has about 1,780 retired employees who receive health insurance.