Shutesbury Town Hall.
STAFF FILE PHOTO
SHUTESBURY — A variety of options, such as increasing the fiscal year 2026 operating budget, transferring free cash and dipping into the Other Post-Employment Benefits Account, are being explored by town officials to cover a $123,800 increase in health insurance costs.
Like the other 72 members of the Hampshire County Group Insurance Trust, the Shutesbury Selectboard and Finance Committee are beginning to wrestle with how to pay for a 20% increase that goes into effect Oct. 1. This spike is on top of a 19% increase that kicked in on July 1.
The Selectboard has tentatively scheduled a Special Town Meeting for Tuesday, Sept. 23, at 6:30 p.m. Town Administrator Hayley Bolton said the meeting will involve action to ensure the town can pay the full $742,800 that is owed to the trust, up from the $619,000 that was approved during Annual Town Meeting in May.
The 20% increase was approved by Hampshire County Group Insurance Trust members at a July 30 meeting to keep the trust from possibly going bankrupt by the end of August or September. The loss of reserves is being blamed on the high costs of drugs, including GLP-1s that are used for weight loss, and a spike in the number of high claims.
The trust provides insurance for more than 12,000 active and retired public employees for many Hampshire and Franklin county cities and towns, water and fire districts, regional schools and other government entities.
For Shutesbury, Annual Town Meeting voters already dealt with a $99,000 health insurance increase from the $520,000 that was spent in fiscal year 2025.
While a transfer from the free cash in the reserve fund may be the simplest way to cover the rising health insurance costs, Finance Committee member George Arvanitis suggested dipping into the Other Post-Employment Benefits, or OPEB, fund for some of this money.
Committee Chair Ajay Khashu said revising the operating budget might also be possible, though it could be complicated to do since the fiscal year has already begun.
Finance Committee member Susie Mosher said it’s unfortunate that representatives from the trust didn’t let members know until recently about the challenging situation, as communities might have used different strategies to pay the bills. But Mosher suggested that Shutesbury doesn’t need to make an appropriation before Oct. 1 since the trust isn’t paid in one lump sum.
Bolton said in addition to the town paying more for insurance, premiums will go up for employees who are covered, and the trust has strategies to reduce costs, such as no longer covering the GLP-1 drugs if they are prescribed solely for weight loss and not for diabetes.
The Selectboard also authorized Treasurer Ryan Mailloux to put out a request for proposals and do other due diligence to see what other options for health insurance might be available, though any decision to leave the trust requires a 90-day notice.
