The URL can be used to link to this page

Home My WebLink About1996-06-10 96-278 RESOLVECOUNCIL AMON Item No. 96-278 Date 6/10/96 Item/Subject: RESOLVE, Establishing Cost Sharing Rates for Group Health Insurance Coverage for Non -Union Employees Effective July 1, 1996 through June 30, 1997 Responsible cepartmert: Administration Commentary: Leat year, the City Council revised the cost sharing formula for Non -Unionised Enployees from a 80V City Share/20& Employee Share to a graduated formula as follows: Plan City Share Employee Share Family 75t 25i Single Parent 77.5} 22.5* Bingle sot 20* Staff recommends that this formula be continued for the July 1, 1996/June 30, 1997 Fear. Blue Crass/Blue Shield has provided the City with new rates that include a 5* i Retaining the formula would mean the increasewould be apportionedinline with the formula, depending p the coverage selected. r/^��//)�/�./�//I/�i/�(:q RTtiEhT Farraz Department Head Manager's Consents Reviewed and recommended to the Council for approval by Finance Committee. city Manager Associated information: Resolve, 5-31-96 Memorandum, Cost -Sharing Formula Sheet Budget Approval: Finance irectur Legal Approval: . 'i[v eolicito Introduced For Passage First Reading Referral to Page of Assigned to Councilor Woodcock June 10, 1996 96-278 _ CITY OF BANGOR 77.5k MILE.)�l2esnlvB Establishing Cost Sharing Rates for Group Health I 1 ................... ..................... ............................................... �............. .... .... �. Insurance Coverage for Nw-Union Employees Effective .luly 1, 1996 Through BY Ne CRY CauuR sfcte Ulm ofBauasr. B LVBD, the following Group Health Insurance coat sharing £ornula be adopted for Non -Union Employees electing the Traditional Indemnity Plan for the year July 1, 1996 - June 30, 1997: Plan City Share Employee Share Family, 2 Person 751t 25& Single Parent 77.5k 22.54 Single 80k 20t +19 - Ot 100k AND BE IT FURTHER ORDERED, THAT for Non -Union Employees selecting the optional Health Maintenance Organization NBIDI Platt, the City will contribute the same dollar amount to coverage under that Plan as it does for the Traditional Plan. IN CITY COUNCIL June 10, 1996 Passed 96-278 EES0LVE Estdblls 128Coet 5M1dring Pates for oup as t neureroe overage TOT Nan -Union Employees Effective July 1, 1996 tbrougb June 30, 1997 96-278 Graduated Formula Plan City Employee Femily, 2 Person 75k 25k Single Parent 77.5t 22.54 Single 004 204 i19 of look NOTE: For employees selecting the Ban Plan, the City would contribute the same dollar amount toward that Plana it does for the Traditional Plan. The employee's share is greater for the HVID Plan than the Traditional Plan. Pr000eed Coat Sharing Formula Non-union Health Insurance Rates City Effective only 1, 1996 Total Family Traditional Plan 1.13 4.52 City Employee Total .69 7-1-95 7-1-95 7-1-95 Family 84.80 28.27 113.07 Single Parent 59.51 17.28 76.79 Single 36.49 9.12 45.61 7-1-96 7-1-96 7-1-96 Family 88.19 29.40 117.59 Single Parent 61.89 17.97 79.86 Single 37.94 9.49 47.43 Graduated Formula Plan City Employee Femily, 2 Person 75k 25k Single Parent 77.5t 22.54 Single 004 204 i19 of look NOTE: For employees selecting the Ban Plan, the City would contribute the same dollar amount toward that Plana it does for the Traditional Plan. The employee's share is greater for the HVID Plan than the Traditional Plan. Total Difference 1995-1996/1996-1997 City Emploqee Total Family 3.39 1.13 4.52 Single Parent 2.30 .69 3.07 Bingle 1.46 .36 1.82 Graduated Formula Plan City Employee Femily, 2 Person 75k 25k Single Parent 77.5t 22.54 Single 004 204 i19 of look NOTE: For employees selecting the Ban Plan, the City would contribute the same dollar amount toward that Plana it does for the Traditional Plan. The employee's share is greater for the HVID Plan than the Traditional Plan. 96-278 To: Finance Committee Members From: Robert W. Farrar, Director of Administration and Human Resources Subject: Group Health Insurance Coverage and Rates for F797 Data: May 31, 1996 1. Health Insurance Coverage Anticipating another large increase in health insurance premiums for FY97, staff recommended to the Finance Committee that the City take proposals on self-insured health plans during the time that Blue Cross -Blue Shield was preparing our insurance rates for July 1, 1996. Three self-insured proposals were received as well as a proposal for a group plan administered by the Maine Municipal Association. During this time, Blue Cross -Blue Shield also provided the City with new rates effective July 1, 1996. Those rates reflected a 48 increase for the Traditional Plan and the MO Optional Plan. City staff including the City Manager, Finance Director, Director of Administration and Human Resources, and Purchasing Agent, met with Mr. Kim Crossman of Benefit Services (the City's Health Insurance Consultant) and reviewed all four options available. After considerable review and analysis, it was the strong opinion of those volved that the City should stay with Blue Cross -Blue Shield of Maine for the 1996-97 year. This decision was reached primarily based on the fact that Blue Cross -Blue Shield came in with an extremely competitive rate and that conversion from BC/BS to a self-insured third party administrated plan would take considerable time to develop and implement. Blue Cross has also agreed to meet with the City on an on-going basis to address concerns raised by the City concerning pricing and other plan issues. While we are recommending continuing with Blue Cross/Blue Shield for the next year, we also believe that the concept of a self-insured third party administered plan should continue to be explored and evaluated. Given the rapidly changing area of health insurance, there may be opportunities for future consideration of this concept. 2. Health Insurance Rates During the first week in June each year, the City provides its employees with the health insurance rates and cost 96-278 sharing formulas for the year beginning July 1st. This information is critical to employees as June is open enrollment month and is the only time during the year that they can change health insurance plans. Last year, a new cost sharing formula was devised which served as the basis for the amounts to be paid by the City and by participating non -unionized employees. The formula was developed as follows: Family 6®lover 75.01 Traditional Knoloyea 25.09 elan Pct. Tota 1009 Single Parent 19.59 22.59 1008 Single 50.08 20.09 1001 +19 0.09 100.09 1009 Staff would recommend that this formula be continued for the July 1, 1996 -June 30, 1997 year for non-unionized nl - zed employees. With the c 9& increase, this would mean that the family plan total cost would increase $9.52 per week, with the employee picking up $1.13 of the increase and the City picking up $3.39. As committee members may recall, last year moving to the formula essentially n meant a 50-50 split of the 288 increase, resulting i employees in the family plan moving from a $17.00/week payment to a $29.00/week payment, or a $12.00 per week increase. Mr. Crossman will be in attendance to further discuss the health insurance coverage matter, and staff will be prepared to disCuss both topics at the Committee meeting. Should there be any questions concerning these two topics prior to the Finance Committee meeting, please feel free to contact me directly. RWF/idr