A potential $700,000 in savings on the town's health insurance costs for fiscal 2009 will not happen, officials announced this week.
Selectmen approved signing a one-year deal with Harvard Pilgrim Health Care that will increase costs by 16.9 percent, money for which is already part of the fiscal '09 budget proposal.
Carroll said officials were studying an alternative plan through the Massachusetts Interlocal Insurance Association that could have saved the town $700,000.
Carroll said the plan called for a 7.5 percent increase in costs, but included 2 percent hikes in co-pays and several unions balked at the idea.
The good news, said Carroll, is the interlocal plan required a two-year commitment, while the Harvard Pilgrim contract is only for fiscal '09, which paves the way for the town to join the state insurance program in fiscal '10.
Carroll said the state plan, or Group Insurance Commission, recently released its rates for fiscal '09 and they show promise for Norwood.
"It appears right now there is a potential savings to Norwood of $2 million to $3 million," said Carroll.
In July 2007, Gov. Deval Patrick opened the door for cities and towns to join the state program as part of his Municipal Partnership Act.
However, the town still needs to get its employees to agree to join.
Selectwoman Helen Donohue said selectmen agreed to start working with unions on the idea in December and she wants to see more progress.
"I don't understand why you've only met once if we made that vote in December," said Donohue.
But Carroll said both sides were waiting for the Group Insurance Commission rates to be released so they could see terms of the plan including deductibles and co-pays.
"We'll start meeting very soon now that we have the rates," said Carroll.
Under terms of the state's Group Insurance Commission plan, the only negotiating point between the town and employees will be the share each side will have to pay of the insurance bill.
The town currently picks up 70 percent of employees' health insurance costs.
Daily News staff writer Brian Falla can be reached at 781-433-8339 or at bfalla@cnc.com
