Controller: City Lost Millions in Health Care Blunder - FOX 26 News | MyFoxHouston

Controller: City Lost Millions in Health Care Blunder

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When it comes to the health coverage taxpayers provide the public employees who fight our fires, police our streets and generally keep our city running - there's apparently new reason for buyers remorse.

"My blood pressure medicine went from $30 to $160 dollars per month. I work with people whose whole entire paycheck goes toward paying medical deductions for necessary treatment," said Isiah Monroe, a longtime City of Houston employee.

Isiah Monroe is one of thousands of public workers who saw increased premiums, co-pays and deductibles when the City decided to battle rising health care costs by becoming it's own insurance company.

To operate this so called "self-insurance plan" Mayor Annise Parker and City Council hired Cigna.

"I think we really need to take a deep dive and examine whether this really a good thing for us," said City Controller Ron Green.


Green's audit of the prescription benefit portion of the plan indicates that in its role as middleman Cigna kept close to $4 million in rebates and savings that should have gone to the City had Mayor Parker's staff done a better job of deal making.

"On the city side we have some gaps in expertise when it came to negotiating the contract and managing the contract," said Green.

The $4 million in Green's audit can be added to the $21 million dollars reportedly lost by the City over the last two years paying for so called "stop loss" coverage - an enormously expensive hedge against huge medical claims that never happened.

Together the losses attributed to management blunders add up to $357 dollars for each of the estimated 70,000 people insured by the City of Houston.


"At the end of the day the taxpayer still has not realized the savings that were presented to us," said Green.

Mayor Parker, in a written statement, strongly disputed Green's findings.

"The Controller's audit appears to be Monday morning quarterbacking based on a lack of understanding of the true workings of the contract," said Parker.



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