5.9. SR 08-29-1994 - Laserfiche WebLink

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. the premiums would be calculated using base rates and an increase of up to 67 percent based on health histories. Since the Minnesota Care Law will definitely benefit the non-union group, it is recommended that the non-union group stay with HealthPartners coverage and that the City increase its contribution to employees with family coverage until the insurance is rebid in July or earlier if possible. This increase in contribution would be offset by the savings in the Medica contract. Although the non-union group still has the option of going with PEIP, it may not be in our best interest in the long term to make this change at this time. As we have discussed, the risk pool for PEIP is considerably smaller (6,000 versus 650,000) and the City would be tied to a two year contract that we would not be able to get out of unless our premiums increased more than 50 percent. . The attached spreadsheet provides information on the various benefit options. Column one shows the health coverage as of January 1, 1994. Columns two through five relate to the non-union employees. Column two shows the HealthPartners increase effective August 1, 1994. The remaining three columns show the rates effective October 1, 1994, based on a co-pay plan and increased City contributions. Columns six and seven relate to the Union Medica plan. Column six shows the best case scenario and column seven shows the worst case scenario if the base rates are increased to the maximum amount based on health history information. Below each of these columns is the employee cost per paycheck. On January 1, the employee cost for all employees, both Union and non-union, was $125.46 per paycheck. On August 1, 1994, that went up to $207.81 for non-union employees and $215.30 for Union employees. On October 1, the rates for the Union employees could be as low as $14.10 per paycheck and a maximum of $108.02 per paycheck. The City cost per month is currently $14,463.59. There are several options provided which keep the City cost relatively constant, but offer a substantial benefit to the employees with family coverage. ACTION REQUESTED The Council is asked to take action on the proposed Medica contract for the Union employees which would be effective on October 1, 1994. The Council is also asked to consider increasing the non-union contribution and to consider authorizing the addition of a co-pay to the HealthPartners contract. The increased contribution is temporary and would be adjusted or eliminated on July 1, 1995. It is hoped that the implementation of an office co-pay will decrease utilization. .