Columbus, Georgia

Memorandum



To: All CCG Health Plan Participants



From: Isaiah Hugley, City Manager



Date: December 2, 2005



Subject: Proposed Health Plan Changes



______________________________________________________________________________



As you know, the City absorbed the average of $250 per employee, increased cost

of health care projected for FY2006 (July 1, 2005 through June 30, 2006). Our

healthcare costs continue to escalate and we must continue to look for ways to

minimize the impact and more fairly share health care costs with employees.

Public and private sector employers are now moving in the following direction:



? Rewarding employees that live healthy lifestyles by allowing them to pay less

than those with non-healthy lifestyles for the cost of health care.

? Acknowledging that the sharing in the cost of health insurance is part of an

employee?s compensation; therefore, employers should not bear the full cost of

spouses of employees who have other medical coverage available to them.

? Ensuring that employees do not pay more for health care coverage because of

health care expenses of persons that are not the legal dependents of employees.



Because these principles are so fair and logical, I will be recommending to the

mayor and council that we follow the lead of the State of Georgia and other

progressive employers in redesigning our health insurance premium options for

FY2007 (July 1, 2006 through June 30, 2007). We will begin an audit of

dependent coverage effective January 2006. Although many details for the

proposed FY2007 changes must still be worked out, I will share what we now

know, to provide ample notice to all employees who may be impacted by the

proposed changes.



Proposed Health Care Plan Changes



I. False Claims of Dependent Status ? starting on January 1, 2006, random

audits of dependent eligibility will be conducted. Employees selected for

audit will be required to provide proof of legal marriage and/or dependency for

a covered spouse and for each covered dependent. Under the City health plan,

eligible dependents are the employee?s spouse, unmarried dependent children

until attaining age 19 (age 26 if they remain dependents and are full-time

students), legally adopted children (from date employee assumes legal

responsibility), children for which employee is the legal guardian,

stepchildren, and children of employee or spouse for whom employee has legal

responsibility resulting from a valid court decree. Employees making false

dependent insurance eligibility statements will lose access to all City health

plans1 for 12 months after the false statements are discovered. To provide an

amnesty period, open enrollment is being extended until December 31, 2005

during which time employees may remove unqualified dependents from their health

plan without question or penalty.



II. Healthy Lifestyle Premiums ? our plans will have a Standard Premium Plan in

which all employees may participate and an optional Preferred Premium Plan for

employees that do not use tobacco products. Preferred family plans will not

permit tobacco use by any covered dependent. Participants in the Standard Plan

will pay $18.50 more biweekly than the premium for the Preferred Plan.

Preferred Plan participants (including spouse, if covered) will be required to

sign an attestation of their intent to remain tobacco free and of their tobacco

abstinence for the prior 12 months (for the initial enrollment period starting

on July 1, 2006, the tobacco free abstinence period will be reduced to 6

months). Participants must also agree to random testing for evidence of

tobacco product consumption while enrolled in the Preferred Plan. Employees

making false tobacco product use statements for themselves or their dependants

will lose access to all City health plans1 for 12 months after the false

statements are discovered. Programs to help current tobacco users quit so that

they may qualify for Preferred Plan rates will be offered and other healthy

lifestyle requirements will be added in the future.



III. Spousal Coverage Surcharge ? a surcharge of $14 biweekly will be assessed

when an employee chooses to enroll a spouse on the City plan when their spouse

has access to other employer provided group health insurance. To avoid the

surcharge, sponsoring employees and their spouses that enroll in any City

health plan will be required to sign an attestation that they do not have

access to other employer provided group health insurance. The attestation will

include an authorization and release allowing the City to obtain consumer

reports and verify benefit details with known or suspected employers.

Employees making false spousal insurance statements will lose access to all

City health plans1 for 12 months after the false statements are discovered.



1Employees losing access to City health plans because of providing false

enrollment information may qualify for COBRA coverage at higher rates. Current

COBRA monthly rates for HMO are $185.93 for individual coverage and $432.00 for

family coverage; PPO rates are $214.74 for individual and $510.49 for family.



We think this is a good start to more responsible management of our health

plans. If you have other ideas, we would love to hear them. Please submit

your suggestions, comments or questions by interoffice mail or email to Tom

Barron in Human Resources.







RECEIPT FOR THIS NOTICE MUST BE SIGNED BY ALL EMPLOYEES

AND RETURNED TO HUMAN RESOURCES