Health Insurance, Life Insurance, & Medicare

This budget organization provides a centralized cost center for several employee and retiree benefits.

HEALTH INSURANCE

The City participates in the Commonwealth of Massachusetts Group Insurance Commission (GIC). The GIC offers a number of health maintenance organization(HMO), preferred provider (PPO), and indemnity health plan options to employees and retirees delivered through Tufts Health Plan, Harvard Pilgrim, and Unicare. Beginning in FY16, the City funds 80% of the premium costs for HMO and PPO plans and 75% of the premium costs for indemnity plans; the subscribers contribute 20% and 25% respectively. The budgetary item is the City’s share of health insurance costs and does not represent the full cost of health insurance. The full cost of health insurance is financed through a combination of city appropriations, employee and retiree contributions, and grant reimbursements. In FY22, the City will use all of these sources to meet its obligation to fund health insurance.

MEDICARE PAYROLL TAX

Pursuant to federal law, all employees hired after April 1, 1986 are subject to a 1.45% payroll tax to pay for future Medicare coverage. The City is obligated to match this 1.45% payment.

LIFE INSURANCE

Employees can elect to enroll in a $5,000 life insurance policy offered through Boston Mutual Life Insurance where the City contributes half the cost of the premium. Additional life insurance can be purchased at the employees’ expense.