Title
Employee Health Insurance Renewal FY2022
History
The Horton Group conducted a health insurance analysis comparing all benefit lines of coverage for the Village of Orland Park’s 2022 plan year.
Through July 2021, health plan claims ran 18% higher than expected, mainly caused by claimants over $50k but under the stop loss of $100k. Through July, there have been two (2) large claims over the $100k stop loss compared to six (6) in the 2020 plan year and ten (10) in 2019. It appears that claims that slowed in 2020 due to COVID-19 but rebounded slightly in 2021 at a lower cost level, at least for now.
The initial mid-year Horton health insurance renewal forecast was +18%. However, Blue Cross underwriting was favorable with a fixed cost increase of 8.79%, with a bottom line (including claims projection) increase of 7.96%. The initial renewal was reduced further due to Horton’s market analysis and negotiations. As a result, all existing carriers and plan designs remain the recommended programs including:
- Medical/Rx/Dental/Vision
- Life and AD&D/Short Term Disability
- Flexible Spending Account (FSA)
- Employee Assistance Program (EAP)
- Virgin Health Miles
- CHC Biometric Screenings (Wellness Initiatives)
- Employee Assistance Program (EAN)
- Liability
The summary of results are as follows:
I. Medical/ Rx Market Analysis & Recommendations
A. Market Analysis
i. Approached 6 alternative carrier markets (3 quoted and 3 declined to quote)
ii. Approached 10 alternative stop-loss / captive markets (1 quoted and 9 declined to quote)
iii. Three independent Pharmaceutical Benefit Managers (PBMs) were quoted
B. The initial renewal with $100K stop loss (same as current) showed fixed cost increase of +8.79% or +$87,371, but the bottom line with Attachment and HMO Physician Service Fees, would be an expected plan increase of 7.96%.
i. Final renewal after negotiations for $100K stop loss fixed cost was - 7.31% or - $72,626, but the bottom li...
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