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Employee Health Benefit Fund

Employee Health Benefit Fund. Our fund, our future. Employee Benefit Committee. I. Purpose and Recognition

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Employee Health Benefit Fund

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  1. Employee Health Benefit Fund Our fund, our future

  2. Employee Benefit Committee I. Purpose and Recognition The purpose of the Employee Benefit Committee (EBC) shall be to ensure that the employees, dependents, and retirees, of the City of Missoula, receive the best health care benefits for the money spent by the City of Missoula and plan participants for employee benefits. The EBC shall be recognized by all employees and their Bargaining Agents and/or representatives as an advisory committee to the City administrative staff, Mayor and the City Council. II. Representation The EBC shall be comprised of twelve (14) voting members, including representatives of the following associations, unions and employee groups: • Missoula Police Association (1) • International Association of Fire Fighters (1) • Vehicle Maintenance (Machinists) (1) • Street/Signing and Striping Shop (Teamsters) (1) • Street (Operators) (1) • Parks and Recreation (MPEA) (1) • Wastewater Treatment Plant (1) • Missoula Parking Commission (1) • Retirees and COBRA Enrollees (1) • Non-Union/Association/Elected (4) • Parks and Recreation (Teamsters) (1)

  3. History • Fund Balance as of June 30, 2003: ($398,579) • Why? e.g. Medical Inflation, Claims experience • Summary of Plan changes FY04-FY06: -FY04: all premium contributions increased, Rx deductibles and copays, inc. deductible, elimination of benefits, copay to 70/30 -FY05: City inc. premium contribution by $20 PEPM, Sealants covered, orthodontia maintained at $750, child dependent premiums inc. $5 PEPM -FY06: City inc. premium contribution by $30 PEPM, wellness care benefit increased to 100% up to $300 with deductible waived, yearly mammograms & PSA tests, added colonoscopy coverage, added naturopathic & acupuncture coverage, cash incentives for health screenings and other wellness educational programs • Fund Balance as of May 31, 2006: $1,097,993 • Note: the last two months of the fiscal year impact the Plan’s fund balance the most. e.g. In FY05, the Plan paid out approximately $343,000 in May and $451,000 in June for insurance claims.

  4. Factors that affect our Plan Reinsurance or Stop Loss insurance: Stop Loss Insurance protects health plans against catastrophic medical claims. Most self-funded medical plans buy Stop Loss Insurance to cover major plan liabilities above a specified dollar amount. This insurance is designed to protect your plan from large claims resulting from catastrophic illnesses or treatments, such as cancer or organ transplants. Allegiance goes out for bids on the City’s Stop Loss insurance each year. For FY07 the increase in stop loss insurance is 3% (lower than expected). The Stop Loss insurance rate is directly related to the management of our Plan and how much of a fund balance we have. In FY06, the EBC adopted the goal of maintaining a fund balance of at least $1,000,000. Medical Inflation: Trends Nationally 12%-20%. The FY05 budget narrative said the City’s health costs had been trending over 20% over the past three to four fiscal years. EBC feels it's important to plan for this trending annually so the Health Benefit Fund doesn't end up in a deficit position again requiring more major changes.

  5. EBC’s Goals • Maintain a Health Benefit Plan fund balance of at least $1,000,000 • Savings for high claim occurrence • Keeps Stop-Loss insurance rates down 2. Take a proactive approach to our health and the health of our fellow employees • Physical well being, greater productivity, fewer sick days • Better health benefit plan consumers • Promote healthy lifestyles, focus on wellness & Health Fair • Early detection of potentially serious health conditions • Save lives

  6. EBC Recommendations for FY07 & FY08 • Effective July 1, 2006 (FY07), increase employee contributions to the health benefit premium by $5 per month to a total of $15 per month and increase spouse contributions to the health benefit premium by $5 per month to a total of $70 per month only if the City increases their contribution to the health benefit premium by 10%, which is $65 per employee per month. • Effective July 1, 2006 (FY07), permanently increase the Fit City budget by $25,000 to a total of $55,000 annually to cover the wellness screenings for employees every other year. In addition, for FY07 only, increase the Fit City budget by an additional $25,000 one time contribution to cover the wellness screenings for all employees as part of the Voluntary Deductible/Copayment Maximum Reduction Program. (Total FY07 Fit City budget required for screening all employees, Coordinator's salary and regular wellness programs is $80,000) • Effective July 1, 2007 (FY08), increase the annual deductible amount from $300 to $400 per covered person and from $900 to $1,100 per family. • Effective July 1, 2007 (FY08), increase the Copayment Maximum (Out of Pocket) amounts from $2,200 to $2,300 per covered person and from $4,100 to $4,300 per family. • Effective July 1, 2006 (FY07), implement Voluntary Deductible/Copayment Maximum Reduction Program (see attached). Program allows employees to reduce their FY08 Deductible and Copayment Maximum amounts. Participation reduces the Deductible from $400 to $300 per covered person and from $1,100 to $900 per family. In addition, participation reduces the Copayment Maximum (Out of Pocket) from $2,300 to $2,200 per covered person and from $4,300 to $4,100 per family. Both spouses of a family (if applicable) must participate in the Program in order to receive the reduction credit.

  7. Voluntary Deductible/Copayment Maximum Reduction Program (VDCMRP) • The Voluntary Deductible/Copayment Maximum Reduction Program includes participation in at least one blood screening in FY07 and one screening every other year thereafter. The blood screening must include the following tests to qualify: • Comprehensive Metabolic Panel • Lipid panel • Prostate Specific Antigen (PSA) • Complete Blood Count • Screening would be available through: • City's Health Fair and paid 100% by Fit City; or • A physician and paid 100% by the Plan's preventative coverage, which is up to $300 per covered person; or • A physician and paid according to the Plan benefit schedule if the individual's preventative benefit has be exhausted; or • A physician or other provider as part of a routine physical and/or examination required by employer and paid accordingly.

  8. Voluntary Deductible/Copayment Maximum Reduction Program (VDCMRP) • Screening results from Health Fair would be sent to employees and spouses only. A summary of findings excluding any Protected Health Information would be available to the Fit City Coordinator for tracking purposes. An employee may elect to contact case management personnel for follow up questions regarding their results; or they may sign a waiver permitting case management personnel to call them regarding their results. • Screening at the Health Fair or by a physician would not replace an annual or biannual physical examination required by an employee's job specifications. But, if blood screening tests are conducted as part of a routine examination, these could be used to meet the Program requirements provided the required screening tests are conducted and the required paperwork is submitted to Human Resources.

  9. Voluntary Deductible/Copayment Maximum Reduction Program (VDCMRP) • Screening conducted as part of routine or follow-up care for an illness or injury could be used to meet the Program requirements provided the required tests are conducted and the required paperwork is submitted to Human Resources. • Employees and spouses participating in the required screenings outside of the City's Health Fair, must provide written proof to the Human Resource department (on a form to be provided by H.R.) that the required blood screening tests were conducted. • Human Resource department will provide a list of employees eligible for the reduced Deductible & Copayment Maximum to Allegiance by June 15th of each year.

  10. City Administration’s Preliminary Recommendations to City Council • City increase their contribution to the health insurance premium by $30 Per Employee Per Month (PEPM) • Increase Fit City Budget by $50,000 as a one time increase

  11. Questionsand Comments Thank you for your time, The City of Missoula EBC looks forward to continuing our work with the City Council and Administration on building a strong and healthy workforce and Benefits Plan far into the future.

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