5.2. SR 11-13-2007 - Laserfiche WebLink

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'1~~i ~j Elk REQUEST FOR ACTION River To Item Number Ci Council 5.2. Agenda Section Meeting Date Prepared by Worksession November 13, 2007 Lauren Wipper, Human Resource Re resentative Item Description Reviewed by 2008 Flexible Benefits Plan Contribution Lori ohnson, Ci Administrator Reviewed by Action Requested Determine the City's contribution to the 2008 Flexible Benefits Plan. Background/Discussion Last meeting we discussed health insurance for the 2008 plan year. The City Council approved contracting with HealthPartners and offering the options of a $25 Co-pay plan, $500 Deductible plan and a $2,200 High Deductible Health Plan (HDHP). The 2008 budget includes a 3% increase to the City's contribution to the Flexible Benefits Plan. Staff was asked to look at the budget and determine if there were options for additional funding and return with updated plan designs. I discussed additional funding with Finance Director Tim Simon and City Administrator Lori Johnson and we feel we can find offsetting budget cuts to fund additional contributions to the Flexible Benefits Plan. Approximately 90% of costs for this plan come from the general fund with the other 10% from enterprise funds. Below are descriptions of four options for plan design and city contributions. Spreadsheets are also attached to provide further detail of each option. Three of the four options accomplish our goal of providing additional incentive to employees taking the HDHP. If Council would like to consider other options, staff will be prepared to discuss and calculate other options at Tuesday's meeting. Option 1 - 3% Increase to City Contribution Staying with the budgeted 3% increase is the first option. Option 2 - 5% Increase to City Contribution with $300 Health Savings Account (HSA) Match This option increases the City's contribution to 5% for each insurance plan and provides an additional $300 HSA match to employees choosing the HDHP. Providing a match will encourage employees to choose the HDHP and require them to contribute to their HSA if they wish to receive the additional funds. The match can be provided in a number of different ways. For example: For every dollar the employee contributes to their HSA the City will contribute one dollar, or if the employee contributes four dollars, the City can add a dollar to make it five. Of course these are only examples and Council should determine the matching method that is most appropriate.