Agenda Item #1
Columbus Consolidated Government
September 8, 2015
Agenda Report # 20
Mayor and Councilors
Retiree Insurance Plan
Human Resources Department
Approve a resolution authorizing modification of the Medicare eligible health plan benefits and the United Healthcare Medicare Advantage plan.
In October 2007, Council authorized implementation of a Medicare Advantage plan and established a cost sharing formula whereby the City pays 25% of the fully insured health plan premium (Ord. No. 07-70) for employees hired prior to July 1, 2001. All retirees who are Medicare eligible and were hired on or after July 1, 2001 are not eligible for the 25% City subsidy (Ord. No. 14-25). Since 2012 the Retiree Benefits Committee has approved United Healthcare as the carrier for the Medicare Advantage Plan because of the favorable plan design and minimum premium increases.
City Council authorized a contract with United Healthcare for the retiree Medicare Advantage Plan (Res. No. 284-12). There is no recommended change in Medicare Advantage plan provider for the retirees for calendar year 2016 and the Retiree Benefits Committee, ShawHankins Benefits Consulting, and the Human Resources Department recommends remaining with United Healthcare.
Two vendors made bids for coverage, Aetna Insurance and United Healthcare. Humana and BCBSGA declined to provide a quote due to uncompetitive rates. Although Aetna’s bid was competitive, because of the strong renewal submitted by United Healthcare, excellent customer service, and plan offering, the Retiree Benefits Committee was unanimous in their decision to remain with United Healthcare. The one key change to the plan includes raising the out of pocket maximum from $1,000 to $1,500 and a small premium adjustment that represents only $2.11 a month in premium rates increase. The premium rate increased by 1.5% over the 2014 premium rate. The retiree’s monthly rates will increase from $137.92 a month to $140.03 a month for the City subsidized retiree group (hired prior to July 1, 2001) and rates will increase to $186.70 for the unsubsidized retiree group (hired on or after July 1, 2001).
There is minimal cost to the City for the recommended changes due to the minimum increase in premiums, and raising the out of pocket maximum.
The Council must authorize changes to the health plan.
The Retiree Health Benefits Committee, the benefits consultant and the Human Resources Director recommend the proposed resolution.
A RESOLUTION AUTHORIZING MODIFICATION OF THE MEDICARE ELIGIBLE HEALTH PLAN BENEFITS AND THE UNITED HEALTHCARE MEDICARE ADVANTAGE PPO PLAN.
United Healthcare has offered the City a modified Medicare Advantage PPO plan with a minimum increase to premium costs, and raising the out of pocket maximum from $1,000 to $1,500; and,
the premium rate increased by 1.5% over 2014 rates; however, and the out of pocket maximum was raised from $1,000 to $1,500 which helped to lower the premium increase. The monthly rates increase from $137.92 a month to $140.03 for the City subsidized retiree group and rates will increase from $183.89 a month to $186.70 for the unsubsidized retiree group; and,
the Columbus Council must authorize implementation of the recommended changes and options.
NOW, THEREFORE, THE COUNCIL OF COLUMBUS, GEORGIA HEREBY RESOLVES AS FOLLOWS:
That the Human Resources Director is authorized to modify the existing Medicare Advantage PPO contract with United Healthcare to raise the out-of-pocket maximum, and increase premium rates. The changes will become effective January 1, 2016.
Introduced at a regular meeting of the Council of Columbus, Georgia, held the _________ day of _____________, and adopted at said meeting by the affirmative vote of ____________ members of said Council.
Councilor Allen voting __________.
Councilor Baker voting __________.
Councilor Barnes voting __________.
Councilor Buck voting __________.
Councilor Davis voting __________.
Councilor Henderson voting __________.
Councilor Huff voting __________.
Councilor Turner Pugh voting __________.
Councilor Thomas voting __________.
Councilor Woodson voting __________.
Tiny B. Washington, Clerk of Council Teresa Pike Tomlinson, Mayor