Traverse City Record-Eagle


November 9, 2013

Ishpeming dealing with insurance investigation


The report enumerated new procedures established by the city since the health insurance problems came to light.

Before the problems were discovered, it was the sole responsibility of Keto to review the monthly invoices from MEBS, pay the premiums and manage the enrollment and insurance status of city employees.

Under the new system, Rajala remains responsible for both employee enrollment and status changes and processing the monthly bill - which Bakalarski said is still “not an ideal situation,” though the insurance company’s billings are now emailed to City Finance Director Jim Lampman in addition to Rajala.

Current City Treasurer Kaitlyn Feldbauer then makes the monthly premium payment to MEBS “based upon the (city) clerk’s approved invoice.”

On the recommendation of Bakalarski, two additional procedures have been incorporated: Rajala and Feldbauer will meet monthly to verify payroll opt-out payments and Rajala will provide Lampman a copy of her approved monthly invoice “as an additional check and balance.”

In addition to the health insurance overpayments, the report revealed that the city also paid approximately $1,500 of employee life insurance premiums to MEBS beginning in July 2011 and continuing until December 2012 - despite the fact that the city was also paying its regular life insurance provider, North American Benefits Co. The city was able to recover almost $500 of these funds from MEBS, but only for July 2012 through June.

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