HomeMy WebLinkAboutCity of Tamarac Resolution R-2003-247Temp. Reso. #10261 -October 10, 2003
Page 1
Revised 10/15/2003
CITY OF TAMARAC, FLORIDA
RESOLUTION NO. R-2003- `f 7
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 US HEALTHCARE FOR THE
PLAN YEAR EFFECTIVE JANUARY 1, 2004; PROVIDING
FOR PREMIUM RATES CHANGES; PROVIDING FOR
THE CONTINUATION OF THE CURRENT 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 US Healthcare for health insurance
coverage for employees expires on December 31, 2003; and
WHEREAS, Aetna US Healthcare provided premium rates for the renewal of the
City's health insurance plan for 2004; and
WHEREAS, the City has reviewed our experience with Aetna, and determined
that employees were satisfied with Aetna as its insurance provider; and
WHEREAS, the City reviewed the City's plan design and determined since
changes were implemented in calendar year 2003, that no plan changes should be
made for 2004 to allow some time to evaluate the impact of the plan design changes
implemented in 2003; and
WHEREAS, City staff has worked with representatives of Aetna U.S Healthcare
to negotiate the most comprehensive and cost effective health plan for the City's
employees and their dependents; and
Temp. Reso. #10261 -October 10, 2003
Page 2
Revised 10/15/2003
WHEREAS, as a result of these negotiations, our overall premium increase is
15%, pursuant to correspondence attached hereto as described in Exhibit A; and
WHEREAS, health insurance rate increases were anticipated and were budgeted
accordingly in the FY 2004 Budget; and
WHEREAS, the City will continue to pay the premium for HMO single coverage in
total, 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 increase; 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 100% of the single HMO
rate and 80% of the family HMO rate for the plan year beginning January 1, 2004; and
WHEREAS, it is the recommendation of the Director of Human Resources and
the City Manager that the City of Tamarac renew the coverage with Aetna US
Healthcare for health insurance for City of Tamarac employees as described in Exhibit
A subject to any revisions consistent with the benefit plan as negotiated by and between
City staff and Aetna US Healthcare and approved by the City Manager and the City
Attorney effective January 1, 2004; and
WHEREAS, the City Commission of the City of Tamarac, Florida deems it to be
in the best interest of the citizens and residents of the City of Tamarac to renew the
coverage with Aetna US Healthcare for health insurance for City of Tamarac employees
as outlined in Exhibit A subject to any revisions consistent with the benefit plan as
1
1
1
Temp. Reso. #10261 - October 10, 2003
Page 3
Revised 10/15/2003
negotiated by and between City staff and Aetna US Healthcare and approved by the
City Manager and the City Attorney effective January 1, 2004
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 US Healthcare for health insurance for City of Tamarac
employees as outlined in Exhibit A subject to any revisions consistent with the benefit
plan as negotiated by and between City staff and Aetna US Healthcare and approved
by the City Manager and the City Attorney effective January 1, 2004.
SECTION 3: That the appropriate City officials hereby authorize
continued payment of the total cost of 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 100% of the single HMO rate and 80%
of the family HMO rate for the plan year beginning January 1, 2004.
Temp. Reso. #10261 -October 10, 2003
Page 4
Revised 10/15/2003
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 22"d day of October, 2003.
ATTEST:
MARION SWENSON, CMC
CITY CLERK
I HEREBY CERTIFY that
I have approved this
RESOLUTION as to form.
MITCHELL S. KRAF
CITY ATTORNEl ,,'"
i
JOE SCHREIBER
MAYOR
RECORD OF COMMISSION VOTE:
MAYOR SCHREIBER (,L
DIST 1: COMM. PORTNER
DIST 2: COMM. FLANSBAUM-TALABISCO
DIST 3: COMM. SULTANOF
DIST 4: V/M ROBERTS
1-1
EXHIBIT A
TEMP RF:SO #10261
,August 24"'. 2004
City of Tamarac
7525 NW 88" Avenue
Tamarac. H. 33324
Dear Maria:
On behalf of Aetna*, I would like to thank you for allowing us to serve your health benefit needs last year. As
we approach the end of your current contract year, it is time to begin the renewal process for your group
benefits program. The purpose of this letter is to notify you of some important information about changes to
your program that will become effective on January 1, 2004. These changes are summarized on the attached
insert(s). Because of certain state variations that are primarily due to regulatory requirements, you may receive
multiple inserts pertaining to the states in which your members have coverage.
Required Action
Confirmation of your renewal will confirm these changes.
Forward all correspondence to my attention at the address below:
Aetna
8201 Peters Road
Plantation. FI. 33324
I look forward to working with you during your review of Aetna's proposed renewal package. We appreciate
your continued business and look forward to serving you and your employees during the next year. If you have
any questions, please contact me.
Since y,
t� Fenton
Account Manager
* "Aetna" is the brand name used for products and services provided by one or more of the Aetna group of
companies.
Generic Contract Change Letter (1 1/02)
The purpose of this notice is to inform you about changes to your program that will become effective on
January 1, 2004. These changes are applicable to plan sponsors who have Aetna members in Florida or
Georgia.
Summary of Plan Changes
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 year, changes will be made
to both the form of the applicable Group Agreement/Group Policy and the Certificate of Coverage:
GROUP AGREEMENT CHANGES
You will receive your updated agreement/policy under separate cover sometime after the renewal date.
Generally, we have updated the agreement/policy to improve clarity and readability. In addition, please note
the following:
• Interest on Late premiums: Interest is charged from the premium due date (first of the month) rather
than the end of the grace period.
• Premium adjustments: Premium rates can be changed as of any billing date with appropriate
advance notice.
• Fees: Although the agreement/policy gives Aetna the ability to charge certain fees, we are not
planning to make this type of charge at this time. You will be provided with advance notice in the
event charges become applicable to your group.
• Census adjustments: Billing adjustments for changes in enrollment data will now be subject to our
discretion instead of automatic.
• Termination: This provision was revised to reflect various state and federal law requirements. In
addition, we added a provision to encourage and make it easier for groups to give Aetna advance
notice of their wish to terminate coverage.
• Amendments: The agreement/policy provides Aetna with the ability to amend the Group
Agreement/Group Policy after giving notice to the group.
This information reflects several of the changes in the standard Group Agreement/ Group Policy. The
applicable agreement/policy that you receive after renewal may include language that differs from our standard
agreement/policy in these and other provisions, due to differences in state regulatory requirements.
BENEFIT PLAN CHANGES
The Certificate of Coverage will be changed to remove the Safety Net (paid continuation of coverage) feature
and coverage for pediatric dental services. These provisions are not frequently used. In addition, to better align
our benefit plans with our customers' general preferences, we will be covering the diagnosis and treatment of
the underlying cause of infertility, but we are discontinuing the Comprehensive Infertility benefit as a base plan
provision. Finally, we are modifying our Individual Conversion option so that any members eligible for
Medicare are no longer eligible for Individual Conversion plans.
April Plan Sponsor Insert 3 (11/02)
Aetna Inc.
Additional Financial Information
City of Tamarac PH Number: 809520
Effective January 1, 2004 Group Number: 264234
The quotation presented in this package is based on the assumptions outlined below. We reserve the right to add
charges, make adjustments to the charges shown and make other adjustments to the quotation if there are
deviations from these assumptions. If additional information related to this quotation is made available to Aetna at
a later date, we reserve the right to revise this quotation based upon analysis of that information. We reserve the
right to withdraw any portion of this quotation that relates to new plans or extension of existing plans to new
locations. We have made every effort to include information in a manner that reflects existing and expected
business practices for the policy period that you have chosen. However, nearly all of the matters addressed in
this rating are dynamic and subject to change before or after the effective date.
Prior to finalizing rates and open enrollment occurring, City of Tamarac will provide Aetna with full disclosure of
open enrollment materials, including employee contribution rates for all plan options, eligibility definitions for all
plans (retiree, part-time employees), and other carrier plan designs for all sites where our insured product is
offered.
The quoted rates are valid for a twelve-month period commencing January 1, 2004. Where required by state law,
a change in the final filed and approved premium rates may result in an increase or decrease to the quoted rates.
Rates may also be changed due to a change in the factors bearing on the risk we assume:
1. Employer contributes at least 50% of the total cost at each rate tier. In addition, where Aetna is offered as an
option, the contribution strategy does not favor other health product offerings over the Aetna plans. The
monthly employee contribution for the Aetna HMO versus the cost of other plan offerings in the same location
is not greater than $20 for a single rate, or $60 for a family rate. Failure to meet these requirements may
result in termination or non -renewal.
2. At least 75% of eligible employees participate in the employer's plan, or at least 50% when excluding those
providing proof of enrollment in a spouse's plan. Failure to meet this requirement may result in termination or
non -renewal. If fewer than five employees enroll in the Aetna plan in any one site, we may charge an
additional administrative fee.
3. The demographic and/or geographic mix of the enrolled group in any site with at least 100 enrolled
subscribers does not change during the term in a way that in our discretion would increase the per capita
premium by more than 5% versus that assumed when developing final rates.
4. The plan of benefits will be extended to all groups included in our current eligibility files. Our rates assume
that coverage will not be extended to any additional groups of employees without additional information and
underwriting approval and that the total groups of employees will not increase or decrease by more than 10%
in any site with at least 100 enrolled subscribers.
5. Aetna plan designs cannot be significantly different from any other plan offering if the differences have the
potential to create for adverse selection. (For example, Aetna will offer Advanced Reproductive Technology
(ART) benefits only if all other competing options also offer ART at a similar coverage level).
6. For any site with fewer than 100 eligible employees, Aetna's plan is the only HMO style plan available. For
sites with at least 100 eligible employees, a maximum of two competing HMO style plan offerings may be
offered as alternatives to the Aetna plan.
7. Mutualized rates are offered under the condition that Aetna plans are offered on a sole replacement basis or
any competitors' rates are mutualized over exactly the same service areas as Aetna's. The site -specific
Aetna Inc.
Additional Financial Information
City of Tamarac PH Number: 809520
Effective January 1, 2004 Group Number: 264234
contribution strategy must not financially disfavor the Aetna plan. The Aetna plan will be offered in all sites
included in the mutualized rates. If actual enrollment differs from that assumed in calculating the mutualized
rate, we reserve the right to recalculate the rates based upon the site -by -site enrollment.
S. Aetna reserves the right to reallocate the premium rate ratios due to changes in the composition of the
enrolled census. Aetna assumes that rate tier structure and rate ratios for the Aetna plans are the same as
for any competitor plans offered in the same location.
Any changes in the plan of benefits offered, claim payment requirements, procedures, or account structures
initiated by City of Tamarac or required because of legislative or regulatory action may result in a rate
revision.
10. Retirees comprise less than 10% of the enrolled group. If this plan is offered as an option to another plan and
if pre-65 retirees will be offered Aetna coverage, pre-65 retirees must be eligible for coverage from all other
competing benefit plans.
11. Cobra enrollment is less than 10% of the enrolled group.
HMO Renewal/Proposed Rates
City of Tamarac
Effective January 1, 2004
Policyholder Number - US264234
• This exhibit outlines your renewal/proposed rates effective January 1, 2004,
• Please refer to the Financial Conditions and Plan Design Exhibits for an outline of the level of benefits
quoted, as well as the terms and conditions of this proposal.
FL04/QPOS
Current/Assumed
Proposed/
Coverage Categories
Employees
Current Rates
Renewal Rates
Change
Employee Only ..
9
$357,20
$409.00
Employee + Family
12
$833.33
$954.20
[Monthly Total
21
$13,214.76
$15,131-40
14.5097
Total 313 $169,379.16 1 $193,946.20 1 14.50%
Summary of Monthly Billing Rates
City of Tamarac
PH NO 809520
• Proposed rates are effective January 1, 2004 through January 1, 2005,
Rate Comparison
Annual
Annual
Existing
Premium at
Proposed
Premium at
Lives Rates
Current Rates
Rates
Proposed Rates
PPO
Single Employee
4 $ 366.82
$17,607
$ 445.69
$21,393
Family
17 $ 893.19
$182,211
$ 1,085.23
$221,387
21
$199,818
$242,780
TOTAL ANNUAL PREMIUM (PPO) $199,818 $242,780
Renewal Increase 21.5%