HomeMy WebLinkAbout25C - EMPLOYEE GROUP INS
CITY COUNCIL MEETING DATE:
REQUEST FOR
COUNCIL ACTION
CLERK OF COUNCIL USE ONLY:
SEPTEMBER 18, 2006
TITLE:
EMPLOYEE GROUP INSURANCE
RENEWALS
APPROVED
o As Recommended
o As Amended
o Ordinance on 1 st Reading
o Ordinance on 2nd Reading
o Implementing Resolution
o Set Public Hearing For
~~
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CITY MANAGER
CONTINUED TO
FILE NUMBER
RECOMMENDED ACTION
Authorize the City Attorney to prepare and authorize the City Manager and
Clerk of the Council to execute agreements for employee group life and
accidental death & dismemberment, medical and dental insurance.
DISCUSSION
The City's employee group benefit policies, contracts and agreements are
renewed annually on January 1. Currently we provide life and accidental
death & dismemberment coverage and long term disability insurance through
AIG Life Insurance Company for full-time employees. AIG has agreed to
renew our life and accidental death & dismemberment insurance agreement
with no increase in cost for a one year period. We are currently in the
second year of a two year rate guarantee for our long term disability
insurance.
Life Insurance
Insurance Current Insurance Percent Change
Coverage Insurance Rate Renewal Rate
Life Insurance $0.130 per $1000 $0.130 per $1000 0.0%
Accidental Death $0.03 per $1000 $0.03 per $1000 0.0%
& Dismemberment
25C-1
Employee Group Insurance Renewals
September 18, 2006
Page 2
The City will continue to offer the existing three dental plans, which
include one indemnity plan, Delta Dental and two prepaid plans Pacific
Union Dental and Safeguard. There is no rate increase in Delta Dental.
However, Pacific Union Dental rates will increase 8% and are guaranteed
for a period of one year. Safeguard rates will increase approximately 9%
and the rates are guaranteed for a period of three years.
Dental Plans
'1'ype of Coverage Safeguard Dental Safeguard Dental Percent
Previous Rate Rate 2007 Change
Employee $23.22 $25.28 8.9%
Employee Plus $39.79 $43.22 8.6%
Family
Type of Coverage Pacific Union Pacific Union Percent Change
Previous Rate Rate 2007
Employee $23.35 $25.22 8.0%
Employee Plus $50.21 $54.23 8.0%
Family
Type of Coverage Delta Delta Percent Change
Previous Rate Rate 2007
Employee $48.39 $48.39 0.0%
Employee Plus $111. 90 $111. 90 0.0%
Family
25C-2
Employee Group Insurance Renewals
September 18, 2006
Page 3
CalPERS Health Program
The CalPERS Health Program medical rates for Orange County will increase
an average of 12.37%. This increase is caused by the escalating cost of
prescriptions and expensive medical procedures while keeping the current
low co-payment structure.
Plan Employee Employee & 1 Employee & 2+
Only Dependent Dependents
Blue Shield Access+ HMO $407.02 $814.04 $1058.25
Kaiser $360.60 $721.20 $ 937.56
PERSCare $731. 40 $1462.80 $1901. 64
PERSChoice $432.64 $865.28 $1124.86
PORAC(safety members) $439.00 $822.00 $1045.00
Retirees who pay the cost of coverage are not included in the annual cost
estimates. In addition the Police Officers Association is not included in
the medical and dental projections since they maintain their own
insurance programs.
FISCAL IMPACT
The annual cost of each plan may vary depending on changes in the number
of employees currently enrolled during the year. The proj ected annual
costs, using current enrollment as of July 2006 are:
AIG Life Insurance Company
Dental Carriers
CalPERS Medical
REACH (EAP Provider)
Total Annual Cost
$ 265,358
$ 660,796
$ 7,976,933
$ 41,803
$ 8,944,890
Funds in the amount of $8,944,890 are budgeted and available in the
Personnel Services Employee Benefits account (account no. 81-177-6521).
APPROVED AS TO FUNDS AND ACCOUNTS:
~~~~'-~.. ~ )~:-\::_,
Francisco Gutierrez
Executive Director
Finance & Mgmt. Services Agency
25C-3
25C-4