Agenda Item #1
Columbus Consolidated Government
Council Meeting
September 8, 2015
Agenda Report # 20
TO: Mayor and Councilors
SUBJECT: Retiree Insurance Plan
INITIATED BY: Human Resources Department
Recommendation: Approve a resolution authorizing modification of the Medicare
eligible health plan benefits and the United Healthcare Medicare Advantage plan.
Background: 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.
Analysis: 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).
Financial Considerations: 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.
Legal Considerations: The Council must authorize changes to the health plan.
Recommendations/Actions: The Retiree Health Benefits Committee, the benefits
consultant and the Human Resources Director recommend the proposed resolution.
A RESOLUTION
NO. ____
A RESOLUTION AUTHORIZING MODIFICATION OF THE MEDICARE ELIGIBLE HEALTH PLAN
BENEFITS AND THE UNITED HEALTHCARE MEDICARE ADVANTAGE PPO PLAN.
WHEREAS, 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,
WHEREAS, 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,
WHEREAS, the Columbus Council must authorize implementation of the
recommended changes and options.
NOW, THEREFORE, THE COUNCIL OF COLUMBUS, GEORGIA HEREBY RESOLVES AS
FOLLOWS:
Section I.
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
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