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5.f) 2013 Health Insurance Renewal Meeting Date: 09/18/2012 Agenda Item: � �'� , 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 Page 1 of 2 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 w � 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