Sandy Springs staff proposes self-funded employee medical coverage starting Jan. 1

Sandy Springs staff recommends moving employee medical coverage from a fully insured plan to a self-funded plan administered by Cigna on Jan. 1, 2027. Council's Oct. 6 agenda includes the proposal and creation of an Employee Benefits Fund to account for the program.

Under the current arrangement, the city and participating employees pay fixed premiums and Cigna pays eligible medical claims. The proposed arrangement would use city budget funding for eligible medical and pharmacy claims, administration and insurance costs. Staff describes stop-loss protection but also approximately $700,000 in claimant-specific liabilities—higher thresholds requiring the city to pay more of certain claims before reimbursement begins.

Staff also recommends increasing employee medical-plan contributions by 20%, the first increase since 2021. The city would continue to fully fund employee-only coverage under the HSA Base Plan. Staff projects an average cost-sharing split of 92% city and 8% employee.