HONESDALE — A proposal to change the health insurance policy for Honesdale Borough employees fell short of passing during a special meeting held Thursday night.
Finance committee chairman Scott Smith had proposed changing the plan during Monday night's regular meeting.
Because a decision needed to be made by Friday, the special meeting was held.
Smith said by changing the plan, it could save the taxpayers around $45,000 a year. The plan was to change the current deductible for borough employees.
The current plan has a $150 deductible per person for up to three people. That means the most a family would have to pay is $450 in deductible payments.
Smith proposed changing that deductible to $5,000, however, the proposal also said the borough would pay for any increased costs, whether those are deductibles or co-payments.
That would happen by the borough purchasing a supplemental plan.
But the Honesdale Police Officers Association (HPOA) protested the plan and sent letters to the borough saying it would file a grievance if it was implemented.
"Although we commend Councilman Smith for seeking ways to save the Borough money, making unilateral changes to our health care which the members feel are not authorized and against what has been bargained for in past contracts, or awarded through previous arbitration, will not result in any cost savings for the Borough, but rather a costly legal battle," said the letter from the HPOA. "Should the Council continue with the adoption of the proposal, this HOPA will have no choice but to pursue legal action against Council to stop this change and reverse the changes to the benefits package to level that were previously negotiated for in good faith and/or awarded through previous arbitration."
There was also a letter sent to the borough council from the law firm of Lightman, Welby, Stoltenberg & Caputo of Harrisburg which said legal action would be taken if the council voted to change the plan.
"While the Association is willing to bargain with the Borough to achieve mutually agreeable healthcare savings, it will not tolerate unilateral action, which seems to be proposed," said the letter. "Your careful consideration of the forgoing is requested prior to taking any unilateral action that will place the parties in litigation."
An email was also sent to the borough from attorney Thomas W. Jennings of the law firm Jennings Sigmond, P.C. of Philadelphia.
"Any effort to attempt a unilateral modification will be met with prompt legal action that will not only unnecessarily cost both parties to expend financial resources, but, more importantly, expose the Borough to what could be very significant economic damages arising for the breach of the agreement," said a portion of that email.
Page 2 of 2 - During discussion by borough council, Smith said he felt the action would not violate the agreement.
A clause in the collective bargaining agreement reads, "The Borough shall have the authority to switch health plans or providers, so long as the resulting benefits are substantially similar to the pre-existing Blue Care PPO 150 plan."
"It is still a Blue Cross policy and it is still a PPO," said Smith.
Smith said the proposal would "reduce everyone's deductibles" because the borough would be setting up a fund to cover those costs. That would still save money for the taxpayers, he said.
"I believe ... we have an alternative plan allowable under the contract," said Smith.
Smith said the "resulting benefits" of the proposed change are "substantially similar."
"What are the chances of a lawsuit against the borough?" councilwoman Juanita Pisano asked Smith.
He said the letter from the HPOA "says they will file a grievance."
Councilman Harry DeVrieze said he believes that to change a contract, "both sides have to agree."
DeVrieze worried that making the change "could end up costing the borough most of the savings because of potential litigation."
Concluded DeVrieze: "I think they are going to challenge us."
"That is a risk we have to look at," said Smith.
With that, Smith made a motion to change the health care plan. It was seconded by councilman Mike Slish.
When the vote was taken, the motion failed 4-3.
Voting for the motion were Smith, Slish and council president F.J. Monaghan. Voting not to change the plan were Pisano, DeVrieze, Bob Jennings and Jim Brennan.
DeVrieze did encourage the council to use the health insurance coverage as part of the negotiations for the next contract. Those negotiations will likely start soon as the contract expires at the end of this year.
"We should use this as a bargaining chip to get them to pay more of their health care costs," said DeVrieze.
Brennan commended Smith "for all the work you have done" in trying to save money for borough taxpayers. But, he also said this matter should be part of the negotiations process.
In another matter, the council voted 7-0 to appoint Rich Henry as the borough solicitor. He was appointed for one year.
Also, the council voted 7-0 to appoint John Seijk to the Civil Service Commission. The appointment is retroactive to Jan. 1 and is for a six-year term ending in December, 2018.