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HomeMy WebLinkAbout2013-01-14 13-060 RESOLVECOUNCIL ACTION Item No. 13-060 Date: January 14, 2013 Item/Subject: Resolve, Appropriating a $202,268 Rebate of Group Health Insurance Premiums as a Result of the Patient Protection and Affordable Care Act Responsible Department: Finance Commentary: The City of Bangor has received group health insurance rates from CIGNA Healthcare for the plan year beginning January 1, 2013. The calendar year 2012 was difficult health -wise for participants and an expensive year for our insurance plan, resulting in a projected rate increase of 11.50% for 2013. The City has maintained a reserve of refunded premiums with CIGNA to offset any potential small increases in a given budget year. However, due to our 2012 claims experience it will be necessary to institute a premium increase effective April 1, 2013. The FY 2013 budget does not include this rate increase. However, in August 2012, as a result of provisions under the Patient Protection and Affordable Care Act (Healthcare Reform Act), CIGNA had provided the City with a rebate of group health insurance premiums. The rebate was based on the most recent Medical Loss Ratio for CIGNA's large insured groups on a statewide basis. As both the City and subscribers contribute to health insurance premiums, the rebate was divided between the City and subscribers consistent with the requirements set forth by the Act and Department of Health and Human Services regulations. The City's share of this rebate was $202,268. Therefore, this Resolve would appropriate the $202,268 to the various City departmental budgets to pay the City's share of increased health insurance premiums from April 1, 2013 to June 30, 2013 and the balance will be deposited into the benefit reserve. Department Head Manager's Comments: This was reviewed and recommended for approval by the Finance Committee on January 7, 2013. City Manager Associated Information: Resolve Budget Approval: Legal Approval: Introduced for Passage X First Reading Finance Director —41� ,� City Solicitor Page _ of _ Assigned to Councilor Gallant CITY OF BANGOR 13-060 JANUARY 14, 2013 (TITLE.) Resolve, Appropriating a $202,268 Rebate of Group Health Insurance Premiums as a Result of the Patient Protection and Affordable Care Act By the City Council of the City of Bangor.• RESOLVED, THAT the City's share of the rebate of group health insurance premiums as a result of the healthcare reform act is hereby appropriated as follows; General Fund operating budget $70,501, Park Woods operating budget $71, Airport operating budget $15,696, Sewer Fund operating budget $4,984, Bass Park operating budget $1,347, Parking Fund operating budget $226, Golf Course operating budget $282 and the balance to the General Fund Benefit Reserve account. IN CITY COUNCIL January 14, 2013 est Reading CI LRRR IN CITY COUNCIL January_ 28, 2013 Motion wade and seconded for Passage Passed - 6-� CITY CWRK