Item 8FAGENDA ITEM # 8F
JULY 13, 2009
CITY OF ATLANTIC BEACH
CITY COMMISSION MEETING
STAFF REPORT
AGENDA ITEM: Change to Employee Health Insurance
SUBMITTED BY: George Foster, Human Resource Manager ~(Y
DATE: July 7, 2009
BACKGROUND: Based upon the small size of the City workforce, high utilization and
several major medical situations, the City's October 1, 2009 health insurance premiums were
projected to increase by ZS.S%. Therefore, the City requested that the following health providers
give the City proposals for health insurance: Aetna, AvMed, BCBS, CIGNA, Florida League of
Cities, Humana and UnitedHealthcare.
After an evaluation of proposals and meetings with representative from the three companies that
replied (Aetna, BCBS and CIGNA), it is recommended that the City change its health insurance
provider to CIGNA. This recommendation is based upon guidance received that the City would
not be able to assume a 2S.S% rate increase (+$17S,21S) and CIGNA's proposal providing the
best benefits with no increase in premiums to the City or employee.
There are no proposed changes for the City's Health Care and Child Care Flexible Spending
Accounts or the internal management and administration of COBRA.
Anticipating no employee pay adjustments effective 10/01/09, there are no changes being
proposed to the City/Employee ratios of premiums currently paid. It is recommended that the
City continue to pay 9S% of the Base HMO Employee Only coverage and 4S% of any additional
Base HMO coverage selected. This will result in costs to the City and employees remaining
approximately the same.
Under the CIGNA praposal, overall benefits provided. will be reduced; however, no employee will
have a premium rate increase unless they change plans.
Following are some of the major comparisons for the CIGNA Plan:
Physicians and Hospital:
We believe that the vast majority of the primary care physicians and hospitals within our
currern HMO plans participate within the CIGNA HMO plan.
Maximum put-vf-Pocket:
Individual: Base Plan from $3,500 to $5,000
Buy Up Plan remains at $2,500
Family: Base Plan from $7,000 to $10,000
Buy Up Plan remains at $5,000
AGENDA ITEM # 8F
Ji1LY 13, 2009
Benefits:
Primary Care Physician: Base Plan co-pay fram $35 to $25
Buy Up Plan co-pay remains at $25
Specialty Care Physician: Base Plan co-pay from $50 to $45 or $55
Buy Up Plan co-pay from $50 to $50 or $65
Urgent Care Facility: No change to either plan with co-pay remaining at $50
Emergency Room: Base Plan co-pay from $200 to $250
Buy Up Plan co-pay from $150 to $200
Prescriptions: Base Plan from $20/$35/$50 to $15/$40/$70
Buy-Up Plan from $20/$35/$50 to $15/$40/$70
Hospitalization:
Base Plan: From a 30% co-pay after meeting $500 Individual or $1,000 Family
deductible to a 30% co-pay after meeting a $1,000 Individual or $2,000
Family deductible.
Buy Up Plan: From a 10% co-pay with no deductible to a 20% co-pay after meeting a
$500 Individual or $1,000 Family deductible.
Advanced Radiological Imaging (i.e., MRIs, MRAs, CAT Scans and PET Scans, etc.):
Base Plan: From a $50 co-pay to a $250 co-pay unless within an Inpatient Facility
where there would be a 30% co-pay after Plan deductible met.
Buy Up Plan: From a $50 co-pay to a $250 co-pay unless within an Inpatient Facility
where there would be a 20% co-pay after Plan deductible met.
FiTNDING: Additional funding is not required as this action maintains premiums
at the October 20081eve1.
RECOMMENDATIONS: Approve changing the City's health insurance from Aetna to
CIGNA effective 10/01/09.
Approve retaining the City's contribution rate at 95% of the Base
HMO employee only coverage plus 45% of the difference in the
Base HMO and any other coverage selected, i.e., Employee &
Child(ren), Employee & Spouse or Employee & Family.
CITY