03-21-1990 CC MIN - SPECIAL - Laserfiche WebLink

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City Council Minutes March 21, 1990 Page 2 e selecting dependent coverage. In 1989, the cost of insurance escalated to such a point that the City switched policies from Blue Cross/Blue Shield to Physicians Health Plan (PHP). This switching of coverage was approved by the employees, mainly the single coverage employees, in order to reduce the cost of family coverage for employees selecting that package. It was noted that the City's cost could be substantially higher than it currently is if more employees selected dependent coverage. I t was also noted that the City's payment for benefits is somewhat below the average of the communities that were surveyed by the Committee. Finally, Mr. Tyler noted that approximately 15% of the cities surveyed offered equal benefits to all employees. e Kathy Anderson distributed a sheet to the City Council which reflected the results of the survey conducted by the Committee. This sheet is attached to the minutes. It was noted that a survey was sent to 98 cities. Of these 98 cities, the City received 83 surveys back. This is an exceptionally high rate of return. It was noted that the average benefi ts paid for health insurance for family coverage was $238, and that the average cost of single insurance coverage was $112. This corresponds very closely to what the City of Elk River provides; however, 13 communities surveyed provided what was termed equal benefits. Additionally, the average cost of insurance premium was $289 for dependent coverage. This is lower than the City of Elk River and the rationale for this lower premium was that the communities surveyed may have had more employees or a better loss ration which lowered the overall cost of the package. Ms. Anderson continued with her presentation of the community survey results by indicating that over half of the communities surveyed provided dental insurance options to its employees. Additionally, approximately half of the communi ties contribute to the cost of this dental insurance. Other results included the fact that approximately 1/2 the communities provided disability insurance option to their employees; the average life insurance policy offered was $18,000 (the City of Elk River offers $8,OOO); that deferred compensation was offered in only 37% of the communities (this compensation is offered in Elk River); that less than 10% of the communities surveyed offered cash options or insurance premium rebates to the employees; and that only 1/4 of the communities provided Section 125 benefits (the City of "Elk River provides this benefit). In summary, Ms. Anderson stated that the City of Elk River provides good benefits to its employees but the City of Elk River is below the norm and there are many communi ties that provide more benefits than the City of Elk River. e Terry Bye presented the City Council with some of the positive points of view for providing equal benefits to all employees regardless if they select dependent or single coverage. Some of the positive aspects of providing additional benefits to the individuals who select single coverage include increased employee moral, attracting and retaining quality applicants/employees, and the fact that providing more options to all the employees would make a better insurance package available to everyone.