4.3 SR 10-05-2020 - Laserfiche WebLink

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Request for Action To Item Number Mayor and City Council 4.3 Agenda Section Meeting Date Prepared by Consent October 5, 2020 Lauren Wipper, Human Resources Manager Item Description Reviewed by 2021 Flexible Benefits Plan Cal Portner, City Administrator Reviewed by Action Requested Approve, by motion, the 2021 Flexible Benefits Plan design. Background/Discussion Renewal/Premium Rates Our medical insurance renewal with the Public Employee’s Insurance Program (PEIP) is 9.7%. PEIP cited that renewals based on 2019 and 2020 claims were the highest in the plan’s history and they have added about 200 groups over the last three years which increased the program’s loss ratio to 113% (claims/premiums). PEIP also anticipates COVID-19 to result in significantly higher future claims. This is our third year with PEIP and last year we committed to them for two years. Our dental renewal with Delta Dental came in at a 2.72% increase for 2 years. Our insurance brokers, NFP, requested a 0% increase for one year to which Delta Dental agreed. We are scheduled to go out for a formal RFP next year. All of the other plans in the Flexible Benefits Plan are on a rate hold for 2021. City Contribution The city maintains a Cafeteria-style plan with a predetermined contribution for all insurance benefits. The annual budget is based on the last known enrollment, which is subject to change throughout the year. The plan is designed to provide a dollar amount to each employee based on the family level of medical coverage they elect. The 2021 preliminary budget includes a 5% increase to the city’s contribution to employee insurance benefits. Using a 5% increase across all plans and all family levels of coverage results in an increase in premium cost to employees on the Value and Advantage plans and a decrease to employees on the High Deductible Health Plan. The Value Plan is our mid-level plan. Monthly employee premium for this plan ranges from $23.48 for single coverage to $478.50 for family coverage. Employees may “buy up” to the Advantage plan which pays a higher benefit for a higher premium cost, or they can elect the HSA Compatible plan and have additional funds available to contribute to their Health Savings Account or use to “buy” other benefits in the plan. Employees can also “buy” other benefits in the plan through payroll deductions. There is no additional city contribution to employee’s The Elk River Vision A welcoming community with revolutionary and spirited resourcefulness, exceptional service, and community engagement that encourages and inspires prosperity. Updated: August 2020