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Employee Group Insurance Renewals September 15, 2015 Page 2 participate in the Employee Assistance Program. We are currently in the second year of a three - year rate guarantee through December 31, 2017. The City purchases its vision insurance through EyeMed. The City does not contribute to the cost of this coverage. Employees are responsible for the full cost of this coverage. We are currently in the second year of a four -year rate guarantee through December 31, 2018. The City purchases its medical insurance through CalPERS. The CaIPERS health benefit program was established in 1962 under the Public Employees Medical and Hospital care Act ( PEMHCA). In 1967 the program was expanded to allow all public agencies access to the program. The City through a resolution amended its' contract with CalPERS to allow it to participate in PEMCHA in 1996. CaIPERS is the second largest public purchaser of insurance in the nation behind the Federal government and currently provides insurance for all State employees, public colleges and universities and to more than 1,000 school districts and local governments. To address the issue of rising health care costs, market stability, access and choice for contracting agencies, CalPERS utilizes a regional price approach grouping similar located agencies into regions. This approach and other polices are credited with holding down health care premiums, negotiating lower prices from hospitals and negotiating savings on prescription drugs. The change in CalPERS basic HMO health plan rates range from a decrease of 14.35% for Anthem HMO Traditional to an increase of 18.76% for Blue Shield NetValue HMO. The average increase for all HMO health plans will be 4.5% and the average increase for all basic PPO health plans will be 11.34 %. The City will incur a 9.33% increase in costs for employees enrolled in the CalPERS medical plans. The City contribution for SEIU and POA are still being negotiated. The employees will be responsible for any increase in cost above the City contribution. Retirees are not included in the annual cost estimates. The Police Officers Association maintains its own insurance programs for medical, dental, vision and LTD coverage. The specific rates are listed below: AETNA Life Insurance Insurance Coverage Current Insurance Rate Insurance Renewal Rate 2016 Percent Change Life Insurance $0.102 per $1000 $0.102 per $1000 0.0% Accidental Death & Dismemberment $0.020 per $1000 $0.020 per $1000 0.0% 25A -2