HomeMy WebLinkAboutItem 06.jNovember 16, 2011
Proposed Action
Overview
Council Approval of Resolution Authorizing
Employee Dental Insurance Rates for 2012
Item No.
Staff recommends adoption of the following motion: Move to approve a resolution
authorizing employee dental insurance rates for 2012.
Passage of this motion will allow the City to continue to offer dental insurance through
HealthPartners and set the rates for 2012.
The City has been enrolled in the HealthPartners dental plan since 2009. The rates
continue to increase each year and for 2012, the initial premium quote was 12 %. The
insurance Committee decided to review alternative plans and is recommending that the
annual out -of- pocket maximum be reduced from $2,000 to $1,500 per person. By
making this change, the premiums will increase by only 5.8 %.
The City currently pays 100% of the cost of individual coverage for employees. If
employees choose to enroll their dependents, they are responsible for 100% of the
additional dependent coverage. Staff is recommending that we continue this cost
sharing method.
Primary Issues to Consider
• Were alternate quotes solicited?
• Were alternate plan designs considered?
• What is the financial impact by employee group?
Supporting Information
• Resolution Authorizing Employee Dental Insurances Rates for 2012.
Human Res d roes Manager
Financial Impact: $_ 5,149 Budgeted: YIN Y Source: _Various Funds
Related Documents (CIP, ERP, etc.):
Notes: The estimated impact is for all employee groups and is subject to negotiation.
Group
Cost of Increase
Non -Union
$2,589
LELS Sergeants
298
LELS Officers
1,161
Teamsters Public Works
1,101
TOTAL
$5,149
ANALYSIS OF PRIMARY ISSUES:
Were alternate insurance quotes solicited?
Consultant John Korby, Nesbit Agencies, received a rate increase of 12% for the 2012
plan year. He decided to solicit bids to determine if there were better options available
to us. After reviewing the bids received, Mr. Korby advised that HealthPartners
continues to be the best opportunity.
Were alternate plan designs considered?
John provided alternative HealthPartners plan designs to the City's Insurance
Committee for their review. The Committee is recommending a plan with an out -of-
pocket maximum of $1,500 rather than the current $2,000. By making this choice, the
premiums increase by only 5.8 %, rather than the original 12.0 %.
What is the financial impact by employee group?
The city's current policy is to pay 100% of the cost of single coverage. Employees who
choose coverage for their family members pay any additional costs. Since the rates
must be negotiated with the union groups, the following is an estimate based on a
continuation of the current policy. Any changes to this policy will be subject to the City
Council's final approval of the 2012 union contracts.
CITY OF LAKEVILLE
RESOLUTION NO.
RESOLUTION AUTHORIZING
EMPLOYEE DENTAL INSURANCE RATES FOR 2012
WHEREAS, the City Council will establish from time to time the insurance
plans that will be provided; and
WHEREAS, the City Council will establish the costs the City will pay for
employee an dependent under City group dental insurance �i t � and u4pen ent covera �� ruci vic y i vu ucn�a� insui anc e pro€graii s;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of
Lakeville that the following monthly cost responsibility be adopted for the
HealthPartners Open Access Dental Choice insurance plan effective January 1,
2012:
APPROVED and ADOPTED by the City Council of the City of Lakeville
this 21 day of November 2011.
ATTEST:
Option Employee Cost Employer Cost Total Cost
Family 88.02 44.82 132.84
Employee + 1 36.05 44.82 80.87
Employee 0.00 44.82 44.82
Charlene Friedges, City Clerk
CITY OF LAKEVILLE
BY:
Mark Bellows, Mayor