The city was recently notified that the Teamsters Local 589 health plan, under which all union employees in the city are covered, will raise its monthly rates by $43 per person starting in September. That increase equates to about $9,000 extra the city will have to pay through December. A recent notification letter from the teamsters also mentioned that rates will be raised “substantially” at the beginning of 2003 as well.

Finance Director Donna Bjorkman said the city has already ratified contracts with all city employees, save the police union, which is awaiting an arbitration decision. Under the approved contracts Poulsbo is liable to pay for the health plan costs and there is no provision for what happens if the rates go up.

“All the contract says is they’re under the teamster health plan,” Bjorkman told the finance and administration committee Wednesday, noting that this increase was unexpected because rate increases — other than those at the beginning of the year — are rare.

An emotionally-charged committee then brought the issue to the full council to seek input from other council members. Most expressed their thoughts that although the health plan was a good one for employees, the cost to the city was becoming prohibitive.

“You know in the private sector when costs go up the employee shares that cost in the form of co-pays,” mentioned Councilman Ed Stern.

Bjorkman said because most of the teamsters contracts are already set, there isn’t much the city can do about the rate increase. She does plan to speak to members of the teamsters and discuss the possibility of employees helping pay through co-pays or other types of fees. Council will discuss the issue later this month.