ITEM TITLE:
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Discussion Item: Review of Health Insurance Renewal Figures
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SUBMITTED BY: Rhea E Cragun, Human Resource Director
FISCAL NOTES:
Expenditure Required: n/a
Unencumbered Balance: n/a
Funding Source: n/a
RECOMMENDATION:
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Authorize staff to proceed with annual health plan renewal
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SUMMARY STATEMENT:
* Per Council request, staff is providing a first review of renewal figures.
o City Monthly Premium increase:
$190.23 total; $182.62 City Share; $7.61 Employee Share
2.6%, $89K estimated annual cost over 2020 budget
* If authorized, staff will return on 3/17 or 4/7 with contracts for formal Council approval
* The renewal review emphasizes changes in premiums. Staff will provide a follow-up review with Council during the fall operating budget proceedings, emphasizing the plan's fund balance. These two variables provide Council with the best indication of the plan's solvency.
Background and Analysis:
* Staff obtained competing stop-loss quotes reflecting several stop-loss deductible amounts.
o Staff recommends renewing the Plan's stop-loss coverage with Sun Life, and increasing to a $175K deductible from $150K.
* Staff, School and Broker attempted to select renewal variables that not only yield favorable one-year renewal terms, but also position the plan for stable future renewal terms.
* City of Valdez: Increasing the individual stoploss level from $150,000 to $175,000 per individual represents an increase of $289,207 in overall annual expected liability (admin, stoploss and expected claims), from current. Total stoploss premiums savings (hard dollars) is a savings of $40,752 from the renewal premium at $150,000.
* Valdez City Schools: Increasing the individual stoploss level from $150,000 to $175,000 per individual represents a decrease of $329,568 in overall annual expected liability (admin, stoploss and expected claims), from current. Total stoploss premiums savings (hard dollars) is a savings of $35,939 from the renewal premi...
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