CCP 12-09-2014 - Laserfiche WebLink

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11 Pf the city that works for you Council Worksession December 2, 2014 5:00 pm Present: Mayor Dave Jacobsen Councilmember Gina Bauman Councilmember Brian Strub Councilmember Paul Jacobsen Councilmember Mary Burg Absent: Staff in Attendance: Dean Lotter, Joe Hatch, Management Analyst/HR Specialist, Kevin Bulah, ABG Guests in Attendance: Employee Health Insurance Plan Discussion Lotter provided the Council with background information on the City's health insurance situation. He commented that in September, the City was made aware there would be significant fee increases in 2015. This information was made known after the Council set the preliminary levy. He reported that insurance costs were set to increase by 22.3 %. He reported staff has been working through this matter at a committee level and has derived at a solution that works within the confines of the 2015 budget. He reviewed the members of the insurance committee. Hatch discussed the actions of the insurance committee over the past two months. He stated this was an interesting group that was well represented by all groups within the City. Lotter reviewed the history of insurance plans that were offered to employees in the past. He reported only high deductible plans would be offered in 2015, with a high, low and medium option. The proposed plans and coverage options were discussed at length with the Council Kevin Bulah provided comment on the City's experience ratio. He explained the City had a 140% loss ratio in 2014 and has had a loss ratio for the past three years with NJPA. These loss ratios were leading to the proposed rate increase. He believed that higher increases would be seen outside of a pool plan. Councilmember Jacobsen asked if the plan offered any other plans. Keith reviewed the $5,000 and $10,000 plan options available to the City and its employees. He stated a customized plan may be an option: however, this would raise the administrative expense for the plan. Councilmember Bauman inquired if there were other co -ops available. Keith reported this was the case. Lotter stated a new co -op this may be a long -term solution for the City. He then reviewed the proposed recommendation from the insurance committee for the coming year. Councilmember Bauman was in favor of pursuing the $3,000/$6,000 option. She believed that the City's current employees were receiving a Cadillac plan and was already receiving an 80/20 split due to the amount the City was contributing to deductibles. She discussed the benefits of employees making pre -tax contributions to their health savings accounts. Lotter commented the hope would be for the City to reduce its experience ratio in the coming years and bring its loss ratio back closer to 100 %. He stated a wellness program was being considered by the insurance committee. He reported that NJPA has been very good to the City over the past four years and has absorbed over $1 million in losses. He understood that the City could make a change in the long -term, but had to consider the immediate reality of the rate increase for 2015. He indicated his recommendation at this time would be to reallocate $61,500 from the 2015 budget for premium costs and $55,000 to HSA's. He reported if the Council supported these recommendations, language would