Item L1 BOARD OF COUNTY COMMISSIONERS
AGENDA ITEM SUMMARY
Meeting Date: Sept 17, 2013 Division: Employee Services
Time approx. 10:00 a.m.
Bulk Item: Yes _ No X Department: Employee Benefits
Staff Contact Person/Phone#:Teresa Aguiar Ext.4458
AGENDA ITEM WORDING: Discussion and Approval of Group Health Plan changes to become
effective January 1,2014.
ITEM BACKGROUND: On April 17, 2013, Gallagher Benefit Services, the County's Health
Insurance Consultant, provided a presentation which showed that the Group Health Program would be
facing a deficit of approximately $1,647,182 next fiscal year (October 1, 2013 — September 30, 2014).
On June 18, 2013, the County Administrator provided a presentation which included recommended
plan changes to help offset the deficit. The recommended changes will offset the projected deficit by
approximately $752,792. Any remaining deficit (which is projected to be approximately $894,390)
will be taken from fund balance.
On August 21, 2013, the recommended changes were again presented to the BOCC. The BOCC
requested that staff bring back information which showed the approximate revenue if all employees
contributed towards their own health insurance. Currently, employees hired on or after 5/1/12
contribute $50.00 per month and those employees hired before that day contribute $0 towards their
health insurance.
Dependent premiums have not changed since 2004 and the $SO retiree rate has not changed since
2001.
PREVIOUS RELEVANT BOCC ACTION: None
CONTRACT/AGREEMENT CHANGES: The Group Health Plan and the Summary Document will
be revised along with Resolution#354-2003 (Retiree Resolution) if appropriate.
STAFF RECOMMENDATIONS: Approval
TOTAL COST: N/A INDIRECT COST: BUDGETED: Yes No
DIFFERENTIAL OF LOCAL PREFERENCE:
Internal Service Fund
COST TO COUNTY: N/A SOURCE OF FUNDS:—Primarily Ad Valorem
REVENUE PRODUCING: Yes No X AMOUNT PER MONTH Year
'Pik-
APPROVED BY: County Atty_ OMB/Purcasing Risk Management
DOCUMENTATION: Included X Not Required
DISPOSITION: AGENDA ITEM#
Revised 7/09
BOARD OF COUNTY COMMISSIONERS
County of Monroe Mayor George Neugent,District 2
Mayor Pro Tern,Heather Carruthers,District 3
The Florida Keys Danny L.Kolhage,District 1
David Rice,District 4
Sylvia J.Murphy,District 5
Office of the Employee Services Division Director
The Historic Gato Cigar Factory
1100 Simonton Street,Suite 268
Key West,FL 33040
(305)292-4458—Phone
(305)292-4564-Fax
TO: Mayor Neugent and Commissioners
FROM: Teresa Aguiar,Director
Employee Services
DATE: August 29, 2013
SUBJ: Group Health Insurance Benefit Changes
This item requests approval to make changes to the Group Health Insurance Plan to help offset a projected
deficit of approximately $1.6M for the 2014 fiscal year.
The changes being recommended are as follows and are to become effective January 1,2014 if approved:
• Annual individual deductible From$300 yr To$500 yr(this change is being recommended to help
offset the health program funding of the mandated decrease in the annual out of pocket maximum-
-*see below)
• Emergency Room Co-pay From$75 per visit To$100 per visit
• Office Visit Co-pay From$20 per visit To$25 per visit
• Pharmacy Co-pay From$10 generic/$25 preferred/$70 non-preferred
To $10 generic/$35 preferred/$70 non-preferred
• 10% medical premium increase for those that contribute to individual and dependent coverage
• Retiree premium: 10+years of service 65+yrs old: From$50 month To$100 month
• Retiree premium: 10+years of service below 65 yrs old: From$50 To$150 month
At the meeting of August 21, 2013, staff was directed to bring back estimates if the employee's premium
was increased and those numbers are included on the attachment:
• Employees hired on or after 5/1/12 currently contribute$50 a month
• Employees hired prior to 5/1/12 currently do not contribute a premium
*The Annual out of pocket limit will be decreased From$7,500 yr To$6,350 yr. This will provide
individual employee savings of$1,150 per year. This is a mandate of the Patient Protection and Affordable
Care Act and is not pp,for appLQval.
The County currently offers employees the opportunity to pay premiums on a pre-tax basis. Retirees who
pay the$50.00 a month premium have not had an increase in premium since 2001. Dependent premium
rates have not increased since 2004.
If you have any questions,please contact me at 292-4458.
Cif ,ANGE CLIMIENT 1M0lllfI'OSSD APPROX. S !/ NGS
(1/1/14—9/.30/14
Deductible increase $300 $500 $191,399
$200 per year
Deductible increase $300 $400 $120,901
$100 per year
Deductible increase $300 $450 $1.68,244
$150 per year
Coinsurance increase 25%in network/55% 30%in network/60% $194,269
out of network out of network
ER Copay increase$25 $75 $100 $21,700
OV Copay increase$5 $20 $25 $47,53
per visit
OV Copay(PCP/SCP) per $20/$20 $25/$35 $89,459
visit
Pharmacy Copay $10/$25/$70 $10/$35/$70 $1.52,607
increase preferred tier
$10
Pharmacy Copay $10/$25/$70 $10/$30/$70 $85,249
increase preferred tier
$5
C I 16'S S'S' IIPI i l°
.. LIP'PIIII'IIaN5 PROPOSIII':M
5% premium increase Employee(Hired $50 $53
for those who currently 5/1/12+)
contribute to individual
and dependent
coverage
Spouse only $353 $371
Spouse+ 1 child $470 $494
Spouse+2 children or $529 $555
more
1 child $238 $250
2 children $282 $296
3 children $351 $369
4 children $468 $491
5 children or more $529 $555
SWINGS (1/1/14,,,,,.9/30/14)$58,104
..1 1.....:..GE IIu ...._.. .µn_ _._ . _._._. ..._ ,..CUB_ . . .. !!:
10% premium increase Employee (Hired on or $50 $55
for those who currently after 5/1/12)
contribute to individual
and dependent
coverage
Spouse only $353 $388
Spouse+ 1 child $470 $517
Spouse+2 children or $529 $582
more
1 child $238 $262
2 children $282 $310
3 children $351 $386
4 children $468 $515
f-i5 children or more $529 $582
SAVINGS (1/1/14�-9/30/1 ) 114,552
Rl i ,RGS CURRENT PROP SIII'''D SAVING (1/1/14 -
9/30/14)
Retiree premium $50.00 $75.00 $82,845
increase$25 per month
MEMO!i
Retiree premium $50.00 $100.00 $164, 70
increase$50 per month
Retiree (10+YOS) 65 $50.00 $100.00
years old and older
Retiree (10+YOS) under $50.00 $150.00 $225,000
65 years old
Retiree (10+YOS) 65 $50.00 $75.00
years old and older
Retiree (10+YOS) under $50.00 $100.00 $112,712
65 years old
Ri A GE CURI° IIlfENT PROPOSED SAVINGS(1/1/14
9/30/ ,4)
$50 premium increase $0 $50 $490,950
for employees hired
prior to 5/1/12
Premium increase for $0(hired before $100 $1,048,500 OEM
ale „
employees 5/1/12)
* I $50(hired on or after
5/1/12)
Total savings from cost-saving changes: $752,792
Cdntri ufion from fun d balance: 9t 90
Total amount of deficit to be covered: $1,647,182