Selectmen review implications of Fallon Health discontinuing commercial health insurance

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Photo by/Dakota Antelman
Shrewsbury’s police station, senior center and town hall sit off Maple Road.

By Melanie Petrucci, Senior Community Reporter

SHREWSBURY – The Town of Shrewsbury recently learned that its health insurance provider, Fallon Health, will no longer carry commercial health insurance, effective June 30, 2022.  Kevin Mizikar, town manager, reviewed the implications of this situation with the Selectmen April 27.

“For Shrewsbury, that is a significant challenge for us because we are part of the West Suburban Health Group (WSHG), which is a joint purchasing group of 11 or ten other municipal entities,” he stated. “We pool our resources to self-insure ourselves, manage risk and enjoy lower health insurance rates.”

Fallon is the lowest cost plan that is offered through the WSHG. On average, it is about eight percent cheaper than the next cheapest plan available. The cost to bridge the debt that the town will absorb is in the range of $900,000.

“We can’t afford to put an arbitrary eight percent on top of that [tight budget],” Mizikar commented.

The town’s share of the annual cost of the employee premiums is roughly $11.3 million.

The elimination of this plan will impact 709 of the 806 town’s active employees who are on this plan. That represents 87.97 percent of the municipal workforce.

“We know we need to do something, and we’ve begun meeting as a West Suburban Health Group already in planning and going through our key processes for the next fiscal year and considering all other options that we have,” Mizikar said. 

Chair of the Board of Selectmen Beth Casavant remarked that health insurance is one of the largest budget drivers for the town. It’s also one of the most volatile items.