Title
Employee Insurance Renewal FY2017
History
The Horton Group completed a market analysis on behalf of Village of Orland Park and has provided final recommendations for the 01/01/2017 renewal of the following benefit programs:
• Medical/RX
• Dental
• Vision
• Life and AD&D
• Flexible Spending Account (FSA)
• Employee Assistance Program (EAP)
• Virgin Health Miles (Wellness Initiative)
• CHC Biometric Screenings (Wellness Initiative)
Based on the final analysis provided by The Horton Group, the following carriers/vendors associated with each benefit offering effective 01/01/2017 are being recommended:
• BlueCross BlueShield of Illinois (Medical/RX)
• Delta Dental of Illinois (Dental)
• EyeMed (Vision)
• Dearborn National (Life/AD&D and Short-Term Disability)
• Discovery Benefits (Flexible Spending Account Administration)
• Metropolitan Family Services (Employee Assistance Program)
• Virgin HealthMiles (Pedometer and Rewards Program - Wellness Initiative)
• CHC (Biometric Screenings - Wellness Initiative)
• The Horton Group (Benefit Consultant)
The current Crisis Intervention and Counselling Services provided for Village residents were reviewed by the Police Department and HR staff. Metropolitan Family Services (MFS), the current provider, admittedly has had difficulty in providing 24/7 crisis intervention for the Police Department. Staff recommends terminating the current agreement related to resident services with MFS and awarding the contract to Trinity Services, Family Counseling Center. MFS will continue to provide EAP services for the Village. This would be a cost neutral transition with Trinity Services providing the services for the same rate as MFS.
Attached is a summary of the renewal for each benefit offered. Actual budgeted amounts will be adjusted to reflect the number of participants including village and library staff as well as retirees.
As you know, the Village Medical/Rx plan is self-funded and is administered by an insurance carrier to provide the appropriate medical networks and administrative services. Proposals for the FY2017 Medical/Rx insurance administrator renewal are based on the carriers’ estimations of the Village’s expected claims for the year, stop loss coverage, and run-in claims. To ensure the best possible pricing, The Horton Group works on behalf of the Village to negotiate with carriers to obtain the best and final offers.
BlueCross BlueShield of Illinois (BCBS) presented the only full medical/RX proposal resulting in a slight increase in total cost. The BCBS proposal options account for expected claims, stop loss coverage, Affordable Care Act (ACA) fees and a general health insurance reserve. The recommended proposal option includes maintaining HDHP/HSA, Silver PPO, Gold PPO and HMO plan options. Slight modifications may be made to the medical plan designs in accordance with the Affordable Care Act (ACA) and collective bargaining agreements. A summary of these recommended options is attached to this agenda item for reference.
Effective 01/01/2017, the HDHP/HSA plan for non-union, IBEW, AFSCME, MAP, and DCC employees will include a $3,250/$6,500 deductible. Non-union and IBEW employee premium contributions will continue to be based on a percentage of the overall premium cost and participation by the employee and their enrolled spouse in the biometric screenings. Non-union and IBEW employee contributions are as follows for each medical plan offering:
• HDHP/HSA 3%
• HMO 10%
• Silver Plan 10%
• Gold Plan - Employees will contribute the difference between the cost to the Village of the PPO (Silver) and the current PPO (Gold), which ranges from 20% for single coverage to 30% for family coverage.
Employees in the AFSCME, Deputy Chief and Commanders, Metropolitan Alliance of Police (MAP), and Police Supervisors groups will make employee contributions based on flat rates which are outlined in the collective bargaining agreements effective, May 1, 2015 - April 30, 2019. These rates include a wellness incentive rate for those employees that participate in the biometric screening. Changes to the insurance premiums for the Police Supervisors group are pending negotiation and/or finalization of the May 1, 2015 - April 30, 2019 agreement.
In addition, $201,500.00 is included in the Insurance Fund for the employer funding of the HSA accounts for those employees enrolled in the High Deductible Plan.
Mr. Michael Wojcik from the Horton Group was present at the Finance Committee meeting on October 3, 2015 to explain the renewal process, results, and to answer any questions.
On October 3, 2016, this item was reviewed by the Finance Committee, recommended for approval and referred to the Village Board of Trustees for consideration.
Financial Impact
The FY2017 budget will include $5,886,102 in the Insurance Fund and $49,500 in the General Fund (EAP/Crisis Response) to cover the expenses associated with the Village’s employee insurance program. This amount reflects adjustments as referenced below the summary chart.
Recommended Action/Motion
I move to approve the agreements with the recommended carriers/vendors and associated expenses effective January 1, 2017;
And
Approve to retain the Horton Group's services at the recommended rate for FY2017.