Title
Employee Insurance Renewal FY2016
History
The Horton Group completed their annual market analysis on behalf of Village of Orland Park and has provided final recommendations for the 01/01/2016 renewal of the following benefit programs:
* Medical/RX
* Dental
* Vision
* Life and AD&D
* Flexible Spending Account (FSA)
* Employee Assistance Program (EAP)
* Crisis Response Program (Community)
* Virgin Pulse Program (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 01/01/2016 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)
* Metro Family Services (Employee Assistance Program)
* Metro Family Services (Crisis Response Program - Community)
* Virgin HealthMiles (Pedometer and Rewards Program - Wellness Initiative)
* CHC (Biometric Screenings - Wellness Initiative)
* The Horton Group (Benefit Consultant)
* Vendor Review Pending (Flexible Spending Account Administration)
Attached is a summary of the renewal for each benefit offered. Actual budgeted amounts will be adjusted to reflect the number of employees, employee contributions and pre-allocated reserves.
The Village’s Medical and RX benefit plan is self-funded under the “Cost Plus” platform with Blue Cross Blue Shield of IL. The administration of the plan is also handled by BCBSIL inclusive of their PPO and HMO networks. The Medical and RX renewal proposal from BCBSIL for FY2016 is representative of administrative costs, network access, HMO capitation fees, two levels of stop loss protection (specific and aggregate) and expected paid claims estimates based on underwritten projections. To ensure the most competitive pricing results, The Horton Group approaches the marketplace on behalf of the Village to obtain proposals as well as working on negotiating with incumbent carriers for finalized results pricing.
BlueCross BlueShield of Illinois (BCBS) presented the only medical/RX proposal resulting in a slight increase in total cost. The BCBS proposal accounts for expected claims, stop loss coverage, Affordable Care Act (ACA) fees and a general health insurance reserve. The recommended proposal includes maintaining HDHP/HSA, Silver PPO, Gold PPO and HMO plan options. A summary of renewal and the associated premium equivalents are attached to this agenda item for reference.
Effective 01/01/2016, the HDHP/HSA plan for non-union, IBEW, and MAP 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, 2011 through April 30, 2015 and pending negotiation and/or finalization of the May 1, 2015 - April 30, 2019 agreements. These rates include a wellness incentive rate for those employees that participate in the biometric screening.
In addition, $172,000.00 is included in the Insurance Fund for the employer funding of the HSA accounts for those employees enrolled in the High Deductible Plan.
A representative from the Horton Group will be present at the Board meeting on October 19, 2015 to explain the renewal process, results, and to answer any questions.
Financial Impact
The FY2016 budget will include $5,759,427 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 the summary chart.
Recommended Action/Motion
I move to approve the agreements with the recommended carriers/vendors and associated expenses effective January 1, 2016.
And
Retaining the Horton Group’s services at the recommended rate for FY2016.