Item 8E
~•
AGENDA ITEM #8E
JULY 12, 2004
CITY OF ATLANTIC BEACH
CITY COMMISSION MEETING
STAFF REPORT
AGENDA ITEM: Change to Employee Health Insurance
SUBMITTED BY: George Foster, Human Resource Manager
DATE: July 6, 2004
BACKGROUND: On October 1, 1997 the City changed it health insurance from two-
tiers (Employee or Family) to four-tiers (Employee; Employee-
Children; Employee-Spouse; or Employee-Family) and changed
the health insurance provider to AHL with a reduction in HMO
premiums of 24.2%. Premiums have since increased by +6%
(1998); +16.7% (1999); +50.2% (2000); and +108% (2001). In
2002, the City changed it's insurance provider to BC/BS with a
+4% rate increase with no additional increases since. Major
factors to the above rate increases were the small size of the City
workforce and high experience utilization rates based upon several
major medical situations.
Based upon the large increases within the health insurance costs,
the City "froze" the employee contribution rates at the 1998
' premium levels with the City paying 100% of all rate increases
since October 1998.
As the City's experience utilization has improved, the City sent out
a RFP for health insurance. The RFP requested that the City be
provided with proposals for health insurance as similar to the City's
current coverage as possible. Based upon this RFP, the City
received bids from the following:
- Aetna
- BC/BS of Florida
- Florida League of Cities
- Humana
- United
+~ After an evaluation of RFPs received, it was determined that one
resulted in an approximate 44% reduction in the overall HMO
premium rates. The RFP was submitted by Aetna and is for an
~"" HMO and POS plan with benefits very similar; however, not
identical, to the City's current plan.
There are no changes proposed for the City's Health Care and Child
Care Flexible Spending Accounts or the internal management and
administration of COBRA.
Approve changing the City's health insurance from an HMO/PPO
to an HMO/POS. The City currently has 103 employees/retirees
and COBRA participants within the HMO and 8 employees within
the PPO.
Approve changing the City's contribution rate to 100% of the HMO
~'"' employee only coverage plus 55% of the difference. Under this
proposal, no employee within the HMO will have a rate increase;
however, five of the eight employees within the PPO will have a
monthly rate increase of $24.77 per month if they elect to remain
within the POS plan and not switch to the HMO plan.
ATTACHMENT: 1.
2.
3.
4.
5.
Summary of Employee Cost
Summary of Aetna HMO Co-Pays
Summary of Aetna HMO Benefits
Summary of Aetna POS Co-Pays
Summary of Aetna POS Benefits
CITY MANAGER:
AGENDA ITEM #8E
JULY 12, 2004
Following are some of the major comparisons for the proposed
HMO:
Physicians:
We believe that all of the primary physicians within our current
HMO participate within the Aetna HMO.
Hospitals:
We believe that all of the primary hospitals within our current
HMO participate within the Aetna HMO.
Emergency Room co-pay from $50 to $100
Prescriptions from $10/$25/$40 to $10/$30/$50
Diagnostic lab & X-rays from $0 to $25 co-pay
Hospital charges remains at $150 day/ $750 max
Maximum out-of-pocket remains at $1,500/$3,000
Benefits:
Primary Care Physician co-pay remains at $15 per office visit
Specialty Care Physician co-pay remains at $25 per office visit
Urgent Care Facility is $50 per visit
FUNDING: As this is a reduction to the overall cost to the City, funding
included within the proposed 2004/2005 budget will be reduced
accordingly.
RECOMMENDATIONS: As Aetna has offered the City a 13-month rate guarantee; approve
the change of City's health insurance to Aetna effective September
1, 2004.
~.
AGENDA ITEM #8E
JULY 12, 2004
EMPLOYEE
COST OF HEALTH INSURANCE
HMO Employee
Only Employee
+ Child Employee
+ Spouse Employee
+ Family
Number 71 5 19 8
Current $ 0.00 $ 107.28 $ 153.20 $ 317.60
Proposed $ 0.00 $ 107.23 $ 150.68 $ 236.55
Difference $ 0.00 - $ .OS - $ 2.52 - $ 81.05
PPO/POS Employee
Only Employee
+ Child Employee
+ Spouse Employee
+ Family
Number 5 0 2 1
Current $ 0.00 $ 195.34 $ 245.74 $ 509.28
Proposed $ 24.77 $ 153.55 $ 205.77 $ 308.80
+ $ 24.77 - $ 41.79 - $ 39.97 - $ 200.48
~* 11,,
Aetna Aetna Health Inc.® FLEX MEDICAL PLAN
ATLANTIC BEACH CITY OF '
~"'" Florida -Northern
AGENDA ITEM #8E
JULY 12, 2004
COAaVments
PRIMARY CARE PHYSICL4N VISITS
Office Hours $15 copay
After Hours /Home Visits $15 copay
SPECIALTY CARE
Office Visits $25 copay
Diagnostic Outpatient Testing $25 copay
Phys,Occ,Speech Therapy $25 copay
SPUSURGERY $150 copay
HOSPITALIZATION $150/d to $750 max
E~YIERGENCYROONI (copay waived if admitted) $100 copay
URGENT CARE $50 copay
MATERNITY
First OB Visit $25 copay
Hospital $150/d to $750 max
MENTAL HEALTH
Inpatient $150/d to $750/A, 30 days
Outpatient $25 copayN, 20 visits
SUBSTANCE ABUSE
Detoxification $150/D to $750 max
Inpatient Rehabilitation $150/d to $750/A, 30 days
Outpatient Detox/Rehabilitation $25N, 30 rehab visits
PREVENTIVE CARE
Routine Eye Exam (per benefit schedule) $25 copay
Routine GYN Exam $25 copay
CHIROPRACTIC CARE $25 copayN, 20 visits
PRESCRIPTIONS $10/$30/$50, 30 Day
Contraceptives Covered
31-90 Day Supply (MOD only) ~ $20/60/100 copay
DURABLE MEDICAL EQUIPMENT No copay
MAX OUT OF POCKET (copay + coinsurance)
Single/Family $1,500/$3,000
IN-NET LIFETIME MAXIMUM
In-Net Lifetime Maximum Benefit N/A
9560195
All non-emergency specialty and hospital services require a written referral from the pprimary care physician. See Certificate of Coverage
~* for complete hst of terms, benefits and exclusions. Benefits are provided by Aetna Heath Inc ®.
!""' City of Atlantic Beach
AGENDA ITEM #3E
JULY 12, 2004
Section [2] -Product Descriptions
Health Maintenance Organization (HMO)
~ Product Traits .
Provider Network Yes
PCP Required/Role PCP selection required/PCP provides routine care and coordinates all
~. specialtyreferrals
Member Cost Sharing Copay applies to all covered services rendered, coordinated or
referred by a PCP
"~"' Percentage copayment may be applied to inpatient hospitalization and
outpatient surgery
Plan deductible may apply to inpatient hospitalization and outpatient
+~ surgery
Annual out-of-pocket maximum limits may apply
Claim Forms Required No
Available Funding Options Full-risk prospectively rated, self-funded for 250+ life customers
Standard Features
'~' Alternative Health Care ,Provides three programs that offer savings on alternative types of
Programs ;health-related services (such as chiropractors and massage therapists);
over-the-counter vitamins and nutritional supplements; and health-
! related products (such as aromatherapy and natural body care).
External Review Policy Supplements our internal review process by allowing members, or
~ their physicians on their behalf, to request external review when
coverage is denied because it is deemed unnecessary, inappropriate, or
~* ;experimental.
Fitness Program ; Offers reduced membership rates at health clubs and discounts on
'~ certain home exercise equipment.
'"" Healthy Outlook Program® ±. Helps coordinate the care for chronic conditions such as asthma,
diabetes, coronary artery disease, heart failure, and low back pain.
Informed Health® Line. .' .Provides 24-hour, toll-free access to current information on a variety
ofhealth-related topics, including prevention, self-care, chronic
conditions, and complex medical situations. Callers can talk to
'registered nurses or access information confidentially through our
audio library, which offers 2000 topics in English and 1580 m
;Spanish.
Member Health Education ;Offers outreach programs that provide preventive care, educational
materials and reminders, as well as member-initiated educational
~. 'programs.
National Medical Excellency Helps eligible members access appropriate, covered treatment for
'
Program s Institutes of
;solid organ® rid tissue transplants using Aetna
Excellence network; may also include travel expenses for the
~"' member and a companion. Coordinates specialized treatment needed
by members with certain rare or complicated conditions and assists
members who are admitted to a hospital for emergency medical care
when they are traveling temporarily outside the United States.
Vision One® discount Offers discounts on specific eye care services, from Vision One
program participating providers and facilities, including discounts on lasik
surgery (the laser vision corrective procedure).
~.
06/15/2004 www.aetria.com Page 1
'"" AGENDA ITEM #8E
JULY 12, 2004
°" City of Atlantic Beach Section [2] -Product Descriptions
Women's Health for Life Offers direct access to network Ob/Gyres, genetic testing for
Programs :hereditary breast and ovarian cancers, mfertihty and breast cancer
case management programs, maternity management, and more.
Optional Features
Employee Assistance Provides three programs (assessment and referral, solution-focused
Program therapy, and telephone assessment) that customers can purchase
!~"" ~ directly from our preferred mental health vendors.
06/ 15/2004 www.aetna.com
Page 2
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Aetna
AGENDA ITEM #8E
JULY 12, 2004
AETNA HEALTH INC. POINT-OF-SERVICE PROGRAM
Aetna Choice HMO Fles / POS Flex Plan
ATLANTIC BEACH CITY OF '
FL In-Network FL Out-of-Netrvork*
FINANCIAL
Deductible: Single/Family
Coinsurance
Coinsurance Limit: Single/Family
Lifetime Maximum Benefit
PRIMARY CARE PHYSICIAN VISITS
Office Hours
After Hours /Home Visits
SPECIALTY CARE
Office Visits
Diagnostic Outpatient Testing
Phys,Occ,Speech Therapy
SPUSURGERY
HOSPITALIZATION
SKILLED NURSING FACILITY
EMERGENCY ROOM (copay waived if admitted)
URGENT CARE
HOME CARE
MATERNITY
First OB Visit
Hospital
MENTAL HEALTH
Inpatient
Outpatient
SUBSTANCE ABUSE
Detoxification
Inpatient Rehabilitation
Outpatient Detox/Rehabilitation
PREVENTIVE CARE
Routine Eye Exam (per benefit schedule)
Routine Physicals
Immunizations
Routine Mammography
Routine GYN Exam
Pediatric Preventive Dental Exam
CHIROPRACTIC CARE
PRESCRIPTIONS
Contraceptives
31-90 Day Supply (MOD only)
~.
or
N/A $500/$1,500
N/A 70%
N/A $2,000/$4,000
N/A $5,000,000
$15 copay 70% after deductible
$15 copay 70% after deductible
$35 copay 70% after deductible
$35 copay 70% after deductible
$35 copay 70% after deductible
$50 copay 70% after deductible
$300/d to $1500 max 70% after deductible
$300/d to $1500 max 70% after deductible
$100 copay $100 copay
$50 copay
No copay 70% after deductible, 120 visits
$35 copay 70% after deductible
$300/D to $1500 max 70% after deductible
$300/d to $1500/A, 30 days70% after deductible, 30 days
$35 copayN, 20 visits 50% after deductible, 20 visits
$300/D to $1500 max 70% after deductible
$300/d to $1500/A, 30 days70% after deductible, 30 days
$35N, 30 rehab visits 70% after deductible, 44 visits
$35 copay
$15 copay
$15 copay
$35 copay
$35 copay
Not Covered
$35 copayN, 20 visits
$10/$30/$50, 30 Day
Covered
$20/60/100 copay
Not covered
See Insurance Certificate
See Insurance Certificate
Covered (state-specific guidelines)
Not covered
Not covered
70% after ded, $1000/yr (no limit in NY) ~
To receive maximum benefits, In-Network services must be provided by participating providers.
In-Network benefits are provided by Aetna Health Inc ®.
Out-of-Network benefits are provided by Corporate Health Insurance Company:
All benefits, exclusions and limitations are provided in accordance with the applicable Schedule of Benefits, Certificate of Coverage, Group Agreement, Group
Insurance Certificate, and Group Policy.
~•
e~.
Aetna
AETNA HEALTH INC. POINT-OF-SERVICE PROGRAM
Aetna Choice H1VI0 Fles / POS Flex Plan
ATLANTIC BEACH CITY OF '
AGENDA ITEM #8E
JULY 12, 2004
FL In-Network FL Out-of Network*
DURABLE MEDICAL EQUIPMENT No copay 70% after deductible
NIAX OUT OF POCKET (copay + coinsurance)
Single/Family $1,500/$3 ,000
OPENACCESS No referrals needed
* Member precertification required or benefits paid will be substantially reduced. 9560196
To receive maximum benefits, In-Network services must be provided by participating providers.
~, In-Network benefits are provided by Aetna Health Inc.®.
Out-of-Network benefits are provided by Corporate Health Insurance Company°D:
All benefits, exclusions and ltmitations are provided in accordance with the applicable Schedule of Benefits, Certificate of Coverage, Group Agreement, Group
Insurance Certifcate, and Group Policy.
AGENDA ITEM #8E
JULY 12, 2004
"~" City of Atlantic Beach Section [2] -Product Descriptions
Aetna ChoiceTM Point Of Service® (POS®)
~.,, :Products Traits
Provider Network Yes
PCP Required/Role PCP selection encouraged; but not required; PCP provides routine
+~- care; members can seek in-network covered services directly from
their selected PCP, directly from other participating providers without
a PCP referral, or by going out-of-network to licensed non-
participating providers
~*
Member Cost Sharing PCP copay applies to all covered services rendered by the members
selected PCP
Specialist copay applies to all covered services rendered by a
participating provider including anon-selected PCP
In-network percentage copayment may be applied to inpatient
hospitalization and outpatient surgery
In-network plan deductible may apply to inpatient hospitalization and
outpatient surgery
.Annual out-of-pocket maximum limits may apply
Deductible/coinsurance applies to all out-of-network covered services
Claim Forms Required :Only for out-of-network services
~"' Available Funding Options 'Full-risk prospectively rated, self-funded for 250+ life customers
Standard Features
+~ Alternative Health Care ;Provides three programs that offer savings on alternative types of
Programs health-related services (such as chiropractors and massage therapists);
over-the-counter vitamins and nutritional supplements; and health-
; related products (such as aromatherapy and natural body care).
'~ External Review Policy Supplements our internal review process by allowing members, or
their physicians on their behalf, to request external review when
coverage is denied because it is deemed unnecessary, inappropriate, or
~ ;experimental.
Fitness Program ;Offers reduced membership rates at health clubs and discounts on
certain home exercise equipment.
,~ Healthy Outlook Program `Helps coordinate the care for chronic conditions such as asthma,
diabetes, coronary artery disease, heart failure, and low back pain.
Informed Health® Line :: Provides 24-hour, toll-free access to current information on a variety
~. ofhealth-related topics, including prevention, self-care, chronic
conditions, and complex medical situations. Callers can talk to
registered nurses or access information confidentially through our
audio library, which offers 2000 topics in English and 1580 in
'Spanish.
Member Health Education Offers outreach programs that provide preventive care, educational
materials and reminders, as well as member-initiated educational
programs.
06/15/2004 www.aetna.com
Page 1
~.
""' City of Atlantic Beach
AGENDA ITEM #8E
JULY 12, 2004
Section [2] -Product Descriptions
National Medical Excellency
Program Helps eligible members access appropriate, covered treatment for
~
e
the
travel expenses fo
Excellence® network; may also includ
member and a companion. Coordinates specialized treatment needed
by members with certain rare or complicated conditions and assists
members who are admitted to a hospital for emergency medical care
when they are traveling temporarily outside the United States.
Vision One® discount Offers discounts on specific eye care services, from Vision One
program participating providers and facilities, including discounts on lasik
surgery (the laser vision corrective procedure).
Women's Health for Life Offers direct access to network Ob/Gyns, genetic testing for
Programs 'hereditary breast and ovarian cancers, mfertihty and breast cancer
case management programs, maternity management, and more.
` Optional Features
Employee Assistance Provides three programs (assessment and referral, solution-focused
Program therapy, and insight telephone assessment) that customers can
purchase directly from our preferred mental health vendors.
~.
06/15/2004 www.aema.com
Page 2