HomeMy WebLinkAboutCity of Tamarac Resolution R-2008-160Temp. Reso. #11501— October 9, 2008
Revised October 20, 2008
Page 1
CITY OF TAMARAC, FLORIDA
RESOLUTION NO. R-2008-/6&4
A RESOLUTION OF THE CITY COMMISSION OF THE
CITY OF TAMARAC, FLORIDA; AUTHORIZING THE
APPROPRIATE CITY OFFICIALS TO RENEW THE
COVERAGE FOR THE CITY'S HEALTH INSURANCE
PROGRAM WITH AETNA, INC. FOR THE PLAN YEAR
EFFECTIVE JANUARY 1, 2009; PROVIDING FOR
PREMIUM RATE CHANGES; ESTABLISHING THE
COST ALLOCATION OF THE HEALTH INSURANCE
PREMIUM BETWEEN THE CITY AND EMPLOYEES;
PROVIDING FOR A WAIVER REIMBURSEMENT
MAXIMUM; PROVIDING FOR CONFLICTS;
PROVIDING FOR SEVERABILITY; AND PROVIDING
FOR AN EFFECTIVE DATE.
WHEREAS, the City's contract with Aetna, Inc. for health insurance coverage for
employees expires on December 31, 2008; and
WHEREAS, Aetna, Inc. provided premium rates for the renewal of the City's
health insurance plan for 2009; and
WHEREAS, the City has reviewed its experience with Aetna, and determined
that employees were generally satisfied with Aetna as its insurance provider; and
WHEREAS, the City reviewed the City's plan design and determined that plan
design changes are necessary for 2009, as described in Exhibit A, attached hereto and
made a part hereof; and
WHEREAS, City staff has worked with representatives of Willis of Florida and
Aetna, Inc. to negotiate the most comprehensive and cost effective health plan for the
City's employees and their dependents; and
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Temp. Reso. #11501—October 9, 2008
Revised October 20, 2008
Page 2
WHEREAS, as a result of these negotiations, the end result represents an overall
increase of 15% from the approved 2008 contract, and 19% above the 2008 cost after
the premium credit. (See Exhibit A)
WHEREAS, health insurance rate increases were appropriately and prudently
anticipated and were budgeted accordingly in the FY 2009 Budget; and
WHEREAS, the City shall, by this ordinance, establish a cost allocation on a
90/10 ratio between the City and the employee for the payments of the premium for
HMO single coverage, and maintain the current cost allocation on an 80/20 ratio
between the City and the employee for all other coverages so that both the City and the
employee bear a portion of the premium; and
WHEREAS, a waiver reimbursement maximum will allow employees who elect to
purchase insurance through their spouse's employer or otherwise independently from
the City to be reimbursed up to a maximum amount equal to 90% of the single HMO
rate and 80% of the HMO rate for the commensurate tier for the plan year beginning
January 1, 2009; and
WHEREAS, it is the recommendation of the Director of Human Resources and
the City Manager that the City of Tamarac renew its coverage with Aetna, Inc. for health
insurance for City of Tamarac employees as described in Exhibit A, attached hereto,
subject to any revisions consistent with the benefit plan as may be negotiated by and
between City staff and Aetna, Inc. and as approved by the City Manager and the City
Attorney effective January 1, 2009; and
WHEREAS, the City Commission of the City of Tamarac, Florida deems it to be
in the best interest of the health, safety and welfare of citizens and residents of the City
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Temp. Reso. #11501—October 9, 2008
Revised October 20, 2008
Page 3
of Tamarac to renew the coverage with Aetna, Inc. for health insurance for City of
Tamarac employees as outlined in Exhibit A, attached hereto, subject to any revisions
consistent with the benefit plan as may be negotiated by and between City staff and
Aetna, Inc. and as approved by the City Manager and the City Attorney effective
January 1, 2009.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY
OF TAMARAC, FLORIDA:
SECTION 1: That the foregoing "WHEREAS" clauses are hereby ratified
and confirmed as being true and correct and are hereby made a specific part of this
Resolution.
SECTION 2: That the appropriate City officials are hereby authorized to
renew the coverage with Aetna, Inc. for health insurance for City of Tamarac employees
as outlined in Exhibit A, attached hereto, subject to any revisions consistent with the
benefit plan as may be negotiated by and between City staff and Aetna, Inc. and as
approved by the City Manager and the City Attorney effective January 1, 2009.
SECTION 3: That the appropriate City officials hereby establish a cost
allocation on a 90/10 ratio between the City and the employee to pay the premium for
HMO single coverage and maintain the current cost allocation of the health insurance
premium on an 80/20 ratio between the City and the employee for all other coverage.
SECTION 4: That the appropriate City officials hereby authorize a waiver
reimbursement maximum, to allow employees who elect to purchase insurance
through their spouse's employer or otherwise independently from the City to be
reimbursed up to a maximum amount equal to 90% of the single HMO rate and 80%
Temp. Reso. #11501—October 9, 2008
Revised October 20, 2008
Page 4
of the HMO rate for the commensurate tier for the plan year beginning January 1,
2009.
SECTION 5: That all resolutions or parts of resolutions in conflict
herewith are hereby repealed to the extent of such conflict.
SECTION 6: That if any clause, section, or other part or application of
this Resolution is held by any court of competent jurisdiction to be unconstitutional or
invalid, in part or application, it shall not affect the validity of the remaining portions or
applications of this Resolution.
SECTION 7: This Resolution shall become effective immediately upon
adoption.
PASSED, ADOPTED AND APPROVED this day of'2008.
ATTEST:
MARION SWENSON, CIVIC
CITY CLERK
I HEREBY CERTIFY that
I have approved this
RESOLUTION as to form.
EL EN
CITY ATTORNEY
BETH FLANSBAU -TALABISCO
MAYOR
RECORD OF COMMISSION'
MAYOR FLANSBAUM-TALABISCO,
DIST 1: COMM PORTNER�.r
DIST 2: COMM ATKINS-G
DIST 3: V/M SULTANOF
DIST 4: COMM. DRESSLE /-,-u
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EXHIBIT A
City of Tamarac
2009 Medical Renewal Proposal
Under the proposed contract terms, the following changes will become effective January 1, 2009:
• The HMO and QPOS Participating Primary Care Provider, as well as the PPO Preferred Non -Specialist office
visit co -pay amounts will increase from $15 to $20.
• The HMO, QPOS Referred and PPO Preferred Specialist office visit co -pay amount will increase from $25 to
$30.
• The HMO, QPOS and PPO Emergency Room co -pay amount will increase from $100 to $150.
• A hospital inpatient coverage co -pay amount of $500 will be added to the PPO Plan. A 10% preferred/30% non -
preferred co -pay is presently in effect in the PPO plan. A $350 hospital inpatient coverage co -pay amount is presently
in effect in the HMO plan and a $500 Referred hospital inpatient coverage co -pay amount is presently in effect in the
QPOS plan.
*The HMO & QPOS prescription co -pay structure will change from $10/$20/$35 to $10/$25/$40. The $10 tier
includes the formulary generic drugs, the $25 tier includes formulary brand -name drugs, and the $40 tier is for non -
formulary brand -name and generic drugs. The mail-order program will continue the same structure at 2 co -pays for up
to 31-90 day supply.
• The PPO prescription co -pay will change from $20 to $30. A single -tier closed formulary for generic and brand -
name drugs will remain in place in the PPO plan. The mail-order program will continue the same structure at 2 co -pays
for up to 31-90 day supply-
4-Tiered
Monthly
Renewal with
Enrollment Plan Changes
HMO:
Employee Only
118
$414,56
Employee & Spouse
55
$1,033.00
Employee & Child(ren)
29
$895.50
Employee & Family
106
$1,125.00
Monthly Premium
308
$250,953
POS:
Employee Only
5
$530.00
Employee & Spouse
5
$1,170.00
Employee & Child(ren)
2
$1,010.00
Employee & Family
10
$1,310.00
Monthly Premium
22
$23,620
PPO:
Employee Only
9
$670.00
Employee & Spouse
9
$1,550.00
Employee & Child(ren)
1
$1,350.00
Employee & Family
10
$1,700.00
Monthly Premium
29
$38,330
Total Monthly Premium:
359
$312,903
Total Annual Premium:
$3,754,834
Medical Renewal Assumptions - Financial
The City Of Tamarac
Policyholder Number - 809520
Group Number - US264234
Renewal Rate Period: 01/01/2009 through 12/31/2009
The financial quotation presented is based on the financial assumptions outlined in this document. It is important to note that
deviations from these assumptions may result in additional charges and/or adjustments to the renewal rates and/or site terminations.
Employer Contributions - Our rates assume compliance with our standard guidelines on employer contribution strategy. We standardly
require that the employer contribute 75% of the employee cost, or 50% of the total employee and dependent cost. Employer
contributions may not favor other medical plans over that of the Aetna plans.
Participation - 75% of total eligibles must participate in the employer's plan. In the event of waivers due to spousal coverage,
participation should be 50% or higher. Failure to meet one or both of these percentages will have an impact on the next renewal and
could lead to possible withdrawal of medical products. Our offering assumes that Aetna is the sole medical carrier. In the event
alternative carriers are to be offered, we reserve the right to reassess our rates immediately.
Demographic Change - The medical rates will continue to apply assuming that a change in The City Of Tamarac's demographic and/or
geographic mix from that assumed at the time the rates were established does not change the enrollment by more than 10% for any
individual site or line of coverage.
We reserve the right to reallocate the premium ratios and/or the premium rates due to changes in composition of the census.
Eligible population includes active employees only; retirees, regardless of age, are not eligible for coverage. For Arizona, financial
assumptions are based upon current covered lives.
Our rating also assumes that COBRA enrollment continues to represent less than 10% of the covered population.
Contract Period- Our policies provide for automatic renewal upon the completion of each contract period unless either party invokes the
termination provision requiring 31 days advance written notice of termination to the other party. This provision may be invoked at any
time during the continuance of the contract (i.e., is not just limited to termination occurring on the renewal date).
Commissions - Commissions have been excluded from our quoted rates.
Producer Compensation - Aetna has various programs for compensating agents, brokers and consultants. If you would like information
regarding compensation programs for which your producer is eligible, payments (if any) which Aetna has made to your producer, or
other material relationships your producer may have with Aetna, you may contact your producer or your Aetna account representative.
Information regarding Aetna's programs for compensating producers is also available at %rw.w.aetna.com.
Enrollment Assumptions - We have assumed that the plan of benefits will be extended to all groups included in our current eligibility
files. Our renewal assumes that coverage will not be extended to any additional groups of employees without additional census and
rate determination. A summary of assumed enrollment by plan option has been provided in the rate exhibit.
Rate Guarantee - Our rates apply for the contract period and are valid as of the effective date, 01/01/2009. The rates apply only to the
benefit levels and conditions specified and any variations in benefit level or assumed conditions may require a rate change.
Our responses are statements of fact as they exist today. We have made every effort to include information in a manner that reflects
existing and expected business practices for the next policy period. However, nearly all of the matters addressed in this renewal are
dynamic and subject to change before or after the effective date. This renewal is not intended to serve as a substitute for your Group
Agreement and the statements in this renewal are not intended as legal representation or warranties. Our obligations to one another
will be limited to the terms of the Group Agreement.
07/31/2008 www.aetna.com Financial Assumptions FI
Medical Renewal Assumptions - Administrative
The City Of Tamarac
Policyholder Number - 809520
Group Number - US264234
Renewal Rate Period: 01/01/2009 through 12/31/2009
The financial quotation presented is based on the administrative assumptions outlined in this document. It is important to note that
deviations from these assumptions may result in additional charges and/or adjustments to the renewal rates and/or site terminations.
Compliance - The City Of Tamarac will be required to supply Aetna with confirmation of compliance with these Renewal Assumptions.
For example, enrollment materials to verify employer contribution, enrollment to verify minimum participation and plan designs.
Plan Design - The renewal is based on the current plan design. Aetna's standard provisions, contract wording and claim settlement
practices will apply for items not specifically outlined.
Plan offering - We assume that the HMO plan will be offered as an option to the Open Choice for employees residing in an Aetna HMO
network service area.
Changes in Plan - Our guidelines allow for a change in plan on the renewal date only, unless initiated by legislative actions. If a
material change in the plan is initiated by The City Of Tamarac and approved by Aetna, an adjustment to the rates may apply.
Legislative Action - If a material change in the plan is required by legislative action, an adjustment to the rates may apply.
Billing and Payment of Premium - Amount due is payable on the 1st day of the monthly coverage period covered by the invoice. If the
amount due is not paid in full within 30 days, Aetna reserves the right to terminate the contract and/or assess late premium payment
charges.
Open Enrollment - The rates assume that there will be a predetermined annual enrollment period when all eligible employees have a
choice of enrolling in any of the available plans.
Health Insurance Portability and Accountability Act (HIPAA) - Our rates assume that Aetna will be providing HIPAA certification of
coverage for terminated employees or employees who move from product to product.
Plan eligibility - Our rates assume that permanent full-time employees work a minimum of 25 hours per week on a regularly scheduled
basis and that eligible dependents include an employee's spouse and unmarried children up to the limiting age of the plan. Our rates
assume that temporary employees are not eligible for coverage.
Retirees (Not Applicable in Arizona)- The quoted plan is only for active employees, it is assumed that all retirees over and under age 65
are not eligible for coverage.
Our responses are statements of fact as they exist today. We have made every effort to include information in a manner that reflects
existing and expected business practices for the next policy period. However, nearly all of the matters addressed in this renewal are
dynamic and subject to change before or after the effective date. This renewal is not intended to serve as a substitute for your Group
Agreement and the statements in the renewal are not intended as legal representation or warranties. Our obligation to one another will
be limited to the terms of the Group Agreement.
07/31/2008 www.aetna.com Administrative Assumptions FI
Customer Notifications - version 2.47
The City Of Tamarac
Policyholder Number - 809520
Group Number - US264234
Renewal Rate Period: 01/01/2009 through 12/31/2009
Aetna is committed to providing quality health benefit plans at reasonable rates. We continually review the terms of our programs and make
changes as needed to help us meet our goals. This notice is to inform you about changes to your program that will become effective upon
renewal. Should you decide not to incorporate any of the below benefit plan offerings, which will create a change in your current selection of
benefits, you will need to coordinate with your Account Manager. The rates quoted will be adjusted accordingly.
We continually review the terms of our programs and make changes as needed to better align our benefit plans with customer plan preferences
and government regulations, therefore some benefits may have changed from last year's offering.
Aetna's Standards:
HMO Private Duty Nursing
Under the provisions of the new Home Care Amendment, no coverage is available for private duty nursing services. Instead, skilled nursing
services are covered as part of the home health benefit on an intermittent visit basis, with prolonged visits available for a short period following
discharge from a hospital.
Alternate Fee Schedule:
This renewal includes a change to the current benefit effective with the upcoming renewal date. Members may choose from a network of
available providers (physicians and facilities) or may visit a nonparticipating provider. For customers with contract states in AZ, GA, FL, NV, TX
or OK, the nonparticipating provider will be paid based on Aetna's Recognized Amount or Recognized Charge, which is the charge Aetna
determines to be the usual charge level for the geographic area where the covered service is furnished. The member may be balance billed for
the difference between the nonparticipating provider's usual fee and the amount allowed by the plan, in addition to any coinsurance or co -
payments due under the plan provisions. Please Note: PPO and Managed Choice products with DE contracts or OPOS and Choice POS
products with members in KY, CA and WA are not impacted by this change.
Individual Conversion Plans:
Additionally, we would like to take this opportunity to assure that you have been informed of Aetna's decision to discontinue offering individual
medical conversion policies.
As you may or may not already know, Aetna has for the past few years received approval from several state Departments of Insurance to cease
offering individual medical conversion plans in states where it is permissible by law to do so. During this time, Aetna has also received approval
of the amendments to our benefit coverage documentation and has also been notifying all of our affected customers of these changes.
Individual conversion policies have been discontinued for newly eligible individuals who reside in and/or have a group policy issued in the
following states;
Traditional medical products (non -HMO) - Alabama, Alaska, Delaware, District of Columbia, Hawaii, Indiana, Mississippi, Nebraska, New
Jersey, North Dakota, Rhode Island and Texas.
Aetna will continue offering coverage to those already enrolled in an individual medical conversion plan in the states mentioned above.
07/31/2008 www.aetna.com Customer Notifications FI
Customer Notifications - version 2.47
The City Of Tamarac
Policyholder Number - 809520
Group Number - US264234
Renewal Rate Period: 01/01/2009 through 12/31/2009
Medications and Supplies:
Self Injectable Medications:
Certain self -injectable medications will be moved under your prescription drug benefit for members enrolled in HMO -based plans effective with
the upcoming renewal date. Formerly, these medications were covered under medical benefits for HMO -based members. Please see your
account manager for a listing of the "Pharmacy -managed Self Injectable" (PMSI) medications. This benefit is currently in effect for members
with PPO and indemnity plans that have Aetna prescription benefits. There is no change in the coverage of self -injectable medications for
Aetna HealthFundO or Medicare members, or for HMO -based members in California and New Jersey.
NAP
Aetna's National Advantage Program (NAP) includes three components — the base program, Facility Charge Review (FCR), and Itemized Bill
Review (IBR). The base program offers access to contracted rates for medical claims that would otherwise be paid at billed charges. FCR
provides reasonable charge allowance review for most inpatient and outpatient facility claims where a National Advantage Program contracted
rate is not available. IBR reviews in -network facility charges which meet certain criteria and are not billed on a per diem basis often resulting In
the elimination of certain types of charges prior to claim adjudication. These programs save money on eligible claims for your plan and for your
employees/members (since coinsurance and deductibles are reduced). Your claim experience and rates are lower due to NAP savings.
State Mandates and Other State Specific Information:
Effective October 1, 2008, we will be offering both in- and out -of -network benefits based on the contract state in Illinois, New York,
Connecticut, Oklahoma, Maine, Missouri, North Carolina, California, Washington, Kentucky, and Florida. Please refer to your plan documents
for detailed benefit information on potential changes. We are making this change to ensure that members in these states receive the
appropriate benefits and administrative considerations.
07/31/2008 www.aetna.com Customer Notifications FI