For the week of August 27 - September 2, 2003

Ketchum medical costs soaring, survey says

Some city salaries high compared
to other resorts

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"Ketchum currently provides one of the most comprehensive medical insurance plans (among Western resort towns) for its employees"

— THE LOCAL GOVERNMENT INSTITUTE

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By GREGORY FOLEY
Express Staff Writer

An analysis of Ketchum city employee salaries and benefits has determined that the city pays substantially more for medical insurance costs than comparable mountain-resort cities.

Ketchum also pays more for certain city staff positions than other similar cities, a report issued this month by The Local Government Institute says.

The report, which will be discussed by the Ketchum City Council today at 11 a.m., was commissioned by the city to assess whether typical city staffers receive salaries and benefits similar to those paid by cities such as Aspen, Colo., Vail, Colo., Park City, Utah, Jackson, Wyo., and Sun Valley.

Overall, the Washington-based LGI found that many of Ketchum’s salaries are appropriate, but some surveyed positions need adjustment. "With some exceptions, the city’s current pay plan is generally in line with the market at the top step of the city’s current pay plan," the report notes.

However, the report recommends that the city abolish its somewhat complex salary plan in favor of a new, more uniform plan that applies to all city departments and employees.

At the same time, the report recommends that the city "form a committee to explore medical coverage options" to reduce its medical costs. "Ketchum currently provides one of the most comprehensive medical insurance plans for its employees," the report states. In comparing Ketchum this year to 21 Western resort cities, LGI found that Ketchum is paying nearly twice the average of other mountain resorts for its medical plan. Ketchum is paying $598 per month for medical coverage for single employees, while the other cities average payments of $311 per month to cover all or part of the medical costs for one employee.

The median of the costs incurred by the 21 other resorts was $300, the report states.

Ketchum pays more than twice as much as the 21-city average each month to insure employees with a spouse and two children, the report notes.

Ketchum has earmarked approximately $1.1 million in the draft 2003-2004 city budget to cover healthcare costs.

To bring healthcare costs down, LGI recommends that the city seek new bids for coverage, adopt a cafeteria-style plan, or "explore plans with high deductibles (and thus lower premiums), with the city self-funding a reasonable share of the deductible portion."

As for the city’s salary plan, the report studied 10 "key benchmark positions which compose a substantial number of city employees."

Of the 10 selected, LGI discovered that most salaries paid by Ketchum are in line with the other 21 cities, except for the positions of senior planner and fire captain. (The researchers ultimately concluded that the data pertaining to the fire captain position was inconclusive because most of the 21 comparable cities do not have a similar position.)

Missing from the report, however, is a comparison of department head salaries. Ketchum in the last year has significantly increased compensation for department heads, in some cases by more than 20 percent.

During budget discussions this summer, City Administrator Ron LeBlanc said the city needed to increase some department head salaries to set them at levels higher than those of some longtime staffers at the top of the pay scale.

After reviewing the city’s pay-scale plan, LGI recommended that the city simplify the system, in part by lowering the number of step increases an employee can graduate through. The city currently has four separate pay plans that include 16 to 18 steps, the report notes.

LGI is recommending that the city adopt a uniform nine-step plan for all departments.

 

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