The city’s chief financial officer, Ashley Groffenberger, sent a letter to the City Council on Monday saying that health insurance rates for city employees are increasing nearly 23 percent in the fiscal year that begins in July — the highest year-over-year premium costs the city has seen “in recent history.” According to the city, Boston included $483 million in the budget for this fiscal year for all health-related benefits for employees and retirees.
She warned that the increase would also be borne by workers. For employees on the city’s Blue Cross Blue Shield family insurance plans, monthly premium costs could increase from $655 to $803, or $1,773, for the year, she said.
Groffenberger wrote that the city’s overall projected increase is about 15 percent Increasing number of city workers taking GLP-1 drugs. She wrote that drug coverage costs about $32 million this fiscal year but are expected to rise 50 percent to $47 million next year.
The city’s health insurance system covers about 55,000 members of the city’s workforce, their families and retirees. Groffenberger said about 8 percent of city workers on non-medical health insurance plans take the GLP-1 drug for weight loss purposes, though it was not immediately clear Monday how many employees it covers.
In an effort to avoid eliminating GLP-1 drug coverage altogether, Gruffenberger told the council that the city has sought permission from its employee unions to change their health care plans to implement “utilization management” — essentially requiring doctors to get approval from employee insurance providers before prescribing certain drugs.
The change will save the city between $8 million and $9 million annually, Groffenberger said. The city’s Public Employees Committee, which represents city union employees and retirees in health insurance negotiations with the city, voted against approving the change earlier this month, she wrote.
Larry Calderon, president of the Boston Police Patrol Association, the city’s largest police union, told the Globe it is open to talks with the city about how to reduce health insurance costs.
“Everybody out there is experiencing a tough time financially, and any increase will take household income away from another part of the budget,” Calderon said. “My best-case scenario is to keep everyone covered for the drugs they need at the lowest cost.”
The Boston Teachers Union did not immediately respond to The Globe’s inquiries for this story Monday. Boston Firefighters IAFF Local 718 declined to comment.
Alyssa Kadilek — chairwoman of the Public Employees Committee and president of AFSCME Local 1526, the Boston Public Library Employees union — said Monday that she is concerned that the city’s move to require prior authorization could affect all non-specialty drugs, not just GLP-1 drugs.
She also questioned how much money “utility management” would actually save the city each year.
But Groffenberger is now Asking the council’s support to ask the Public Works Committee to take another vote and agree to the change before the end of the week.
Otherwise, she said, the city will consider other options, including joining the Massachusetts Group Insurance Commission, which last month eliminated GLP-1 drug coverage for state employees. The Group Insurance Commission board, which approved the change, cited budget challenges and high costs. State officials said about 22,000 GIC members are currently taking GLP-1 drugs for weight loss, at a total cost of $46 million.
Groffenberger told council members in his letter that city revenues will increase by only 1.5 to 2.5 percent next fiscal year, saying the city “has few resources to absorb these increased costs.”
“These significant financial implications require a departure from standard practice,” Gruffenberger wrote.
“Given these unprecedented circumstances and the unacceptable increase in costs for our employees and the city, our administration has requested that PEC leadership reconvene and take a new vote on the options presented after Friday,” she continued.
The decline in GLP-1 coverage is widespread across the country. Several states have cut coverage for expensive drugs under their Medicaid program, including New Hampshire, where officials planned to cut coverage. To lose weight in January.
North Carolina Finish cover for obesity last fall, citing “shortfalls in government funding,” nearly a year later Reduced under cover State Employee Health Plans of the same class of drugs due to rising costs.
New York City officials said in 2024 that they, too, are reducing coverage of weight-loss drugs after they reportedly pay for them “by mistake“
More than 40,000 customers of two of Massachusetts’ largest insurers, Blue Cross and Point32Health, have lost coverage of GLP-1s for obesity this year, according to data the companies provided to The World. An unspecified number of customers of smaller insurers also lost profits.
Niki Griswold can be reached at niki.griswold@globe.com. Follow her @nikigriswold.
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