4.3. ERMUSR 11-15-2011 - Laserfiche WebLink

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Elk River, Municipal Utilities 13069 Orono Pazkway • P.O. Box 430 Elk River, MN 55330-0430 UTILITIES COMMISSION MEETING Phone: 763.441.2020 Fax: 763.441.5099 TO: FROM: Elk River Municipal Utilities Commission Theresa Slominski -Finance Director John Dietz, Chair Daryl Thompson, Vice Chair Allan Nadeau, Trustee MEETING DATE: AGENDA ITEM NUMBER: November 15, 2011 4.3 SUBJECT: Review and Consider Lon Term Care Insurance O tion BACKGROUND: At our October Commission we presented information on the possibility of providing Long Term Care (LTC) insurance for employees. Discussion followed and staff was directed to determine if the employees wanted this additional insurance. Gary Marx, the insurance representative for LTC, presented information to staff for purposes of educating them on the advantages and disadvantages of LTC insurance. They were presented with a range of $20 to $120 for the possible premium. The employees are interested in the insurance; however they were hesitant to say yes or no without better pricing information. Premium is based on age, health status and plan design. Under the proposed program, each employee's LTC plan's is tailored to the financial needs and budget of the employee and employee's family. The Insurance representative, if a program is implemented, will meet individually with each employee and family to assess and develop a plan design and pricing that fits their individual needs. DISCUSSION: The pricing for the LTC insurance is provided. There are two options presented, and it is based on the age census of our current staff. The two options are employer paid for a base plan, where the employee can buy up more coverage at the employee's expense (Corporate Advantage) and employee paid (Employee Advantage), which is an all Voluntary plan. The pricing assumes that we would have full participation. Obviously, if there is less participation there is less cost. As you can see, there is a greater employer pricing discount for the Corporate Advantage program (15% vs. 10%). The pricing shown for both options also assumes the married employee is the only one applying for coverage. If an employee's spouse applies, an additional IS% discount applies to the employee. So the total monthly premium will be affected by the number of spouses who apply. (Spouses who qualify for Preferred Health will also receive an additional I S% discount.) As presented last month, it is desirable to obtain the "simplified underwriting" (which allows the applicants to complete a three or six question form to enroll, rather than a detailed 20 page