5.f) 2013 Health Insurance Renewal Meeting Date: 09/18/2012
Agenda Item: � �'�
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City Council Agenda Report
City of Scandia
14727 209`h St. North
Scandia, MN 55073 (651) 433-2274
Action Requested: Approve the city's contributions to employee health insurance benefits
for 2013.
Deadline/Timeline: Decision on the renewal must be made by October 1, 2012.
Background: • The city provides an employee health insurance plan through Blue
Cross Blue Shield(BCBSM), as a member of the Southwest/West
Central Service Cooperative,a pool of 124 cities, counties and other
governmental units insuring over 6,000 members. In summary,the
current coverage is a major medical plan with a$1,600 per year
deductible($3,200 for family coverage)paired with a Health Savings
Account(HSA)with 100%coverage after the deductible is met.
Prescription coverage is included and counts toward the deductible.
• Five full-time employees are currently eligible for the plan, 2
currently taking family coverage.
• The City currently contributes 100% of the premium cost ($452.50
per month) for employees taking single coverage, and 80%
($1,160.00) of the premium ($1,450.00) for employees taking
family coverage. The City also contributes $105 per month to a
health savings account (HSA) for each eligible employee taking
single coverage, and $140 per month for employees taking family
coverage.
• Premiums will increase by 15% for 2013. The monthly rate for
single coverage will be $520.50 per month. Family coverage will
be $1,667.50 per month. The city's share, at 80%, would be
$1,334.00 per month.
• As in the last couple years,because the city's experience rating for
the covered time period was poor, the pool protected the city from
a much larger increase. The carrier (Blue Cross) said a 126.3%
increase was needed based on our experience. Because the rating
looks back for a 24 month period (March, 2010 through February,
2012) the city is still seeing the affects of some catastrophic claims
from a former employee. Until those claims are far enough in the
past, the experience rating would make it difficult to find better
rates than those available through the pool.
• The Council discussed the renewal at the August 28 meeting, and
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09/11/12
directed staff to prepare a resolution to approval renewal of the
current plan and to continue the city's current level of
contributions to premiums (100% for single coverage, 80% for
family coverage) and HSAs in 2013.
Recommendation: The Council should adopt the attached resolution.
Attachments/ • Draft Resolution No. 09-18-12-03 Establishing City Contributions
Materials provided: to Employee Health Insurance Benefits for 2013
Contact(s):
Prepared by: Anne Hurlburt, Administrator
(2013 health insurance contributions)
Page 2 of 2
09/11/12
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CITY OF SCANDIA
RESOLUTION NO.: 09-18-12-03
RESOLUTION ESTABLISHING CITY CONTRIBUTION TO EMPLOYEE
HEALTH INSURANCE BENEFITS FOR 2013
WHEREAS, the Scandia City Council has determined that it is the best interest of the City to
provide a health insurance plan to help maintain the health of its current employees and to enable the
city to attract and retain a quality workforce; and
WHEREAS, it is now necessary to determine the insurance plan and contributions to
premium costs for 2013;
NOW, THEREFORE, BE IT HEREBY RESOLVED BY THE CITY COUNCIL OF
THE CITY OF SCANDIA, WASHINGTON COUNTY, MINNESOTA, that it should and hereby
does approve the renewal of the health insurance plan with Blue Cross Blue Shield (BCBSM)
(Service Cooperative Health Plan #176) for the period of l/1/13 to 12/31/13; and
FURTHER BE IT RESOLVED, that for calendar year 2013, the City of Scandia's
contribution to the total cost of providing health insurance benefits shall be as follows:
City Contribution to City Contribution to
Health Insurance Health Savings Account
Premiums (Monthl ): (Monthly):
Full-time Employee (40 hours/week), a
Family Coverage: $1,334.00 (80/o) $140.00
Full-time Employee (40 hours/week), o
Single Coverage: $520:50 (100%) $105.00
Part-Time Employee (30 to 40 $520.50 (100%)
hours/week), Single Coverage $0.00
Part-Time Employee(30 to 40 $520.50 $0.00
hours/week), Family Covera e
Adopted by the Scandia City Council this 18'h day of September, 2012.
Randall Simonson, Mayor
ATTEST:
Kristina Handt, Administrator/ Clerk