The meeting’s primary focus was the borough’s potential shift from the state healthcare plan to the HIF, a decision driven by the steep premium increases forecasted for the state plan. Joseph Albahani from Capital Health Benefits delivered a detailed presentation highlighting the financial advantages of the HIF compared to the state plan’s costly trajectory. According to the presentation, the state plan had already exhibited a 22% increase in the previous year and a 36% increase for the current year, with future projections as high as 50%. This trend was described as a “death spiral,” compelling Dunellen and other municipalities to seek alternatives.

The proposed transition to the HIF was presented as a financially sound move. Albahani explained that the monthly insurance cost for members would decrease from $1,745 to $1,310. For employees contributing 35%, this would reduce their paycheck deductions from $786 to $590. The HIF promises to maintain the current healthcare structure, ensuring members retain their existing doctors and hospitals, with added benefits like zero co-pays and improved prescription drug coverage for retirees.

Mayor Jason F. Cilento clarified that while the HIF would still result in a 14% increase over the previous year’s rates, this was considerably less than the projected 36% increase under the state plan. He emphasized that the reported savings were a reduction below what would have been a substantial increase, rather than a direct budget increase. The savings for active employees were projected to be $333,627, with the total savings over two years potentially reaching half a million dollars.

The council engaged in discussions regarding the sustainability of the state plan versus the HIF. A significant aspect of the HIF is its selectivity; out of 125 municipalities that applied, only 10 were accepted, with Dunellen being one of them. This exclusivity is viewed as beneficial, as it aims to prevent scenarios where municipalities with favorable claims leave, thereby increasing rates for remaining members.

The financial history of the borough’s health benefits was reviewed, revealing an 80% total increase over the past four years. Specific annual increases included 23% in 2023 and 7.7% in 2024, with a potential 63% hike recently negotiated down to 36.5%. These figures underscored the urgency of transitioning to the HIF, which required a 60-day notice to the state plan. The special meeting was convened to ensure the necessary resolution could be passed before the October 30 deadline, preventing a delay in transition that would result in higher rates for an additional month.

Council members were informed that union representatives had been consulted and were comfortable with the proposed changes. All resolutions concerning the transition were read aloud, including the authorization for Dunellen to join the HIF, the termination of membership in the state health benefits plan, and cessation of participation in related plans like prescription drug and dental coverage. The resolutions were moved, seconded, and adopted without dissent.