6.2 ERMUSR 09-13-2005 - Laserfiche WebLink

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Elk River Municipal Utilities I le 2006 Health Plan Renewal Prepared by David Martin Agency, Inc. September 2005 I I 2006 Health Plan Rates The Aware Gold with $15 Copay Plan from Blue Cross Blue Shield of Minnesota will increase by 20.6% on January 1, 2006. This is annual increase of$63,330 or $5,277.50 I per month. Total 2006 annual premium will be $370,710. The average single rate will be $311/month; the average family rate will be $1,173/month. The 20.6% increase includes an actual rate increase of 15.4% plus an additional 5.2% due to your group's I individual claim experience. Health insurance trend rates in the general marketplace are running between 11% - 13%. The Service Cooperative pool is indicating a lower trend rate of 9% - 10%. I Health Plan Insurance Pool I The plan carrier is Blue Cross Blue Shield of Minnesota which provides plan benefits and claims/administrative services. Renewals are distributed through Resource Training & Solutions, the Service Cooperative and David Martin Agency, Inc. Plan rates for Elk I River are based on the MN Care small group insurance pool of 2-50 employees under the Resource Training & Solutions umbrella. This pool is comprised of 19 employer groups ill having about 13% of total pool employees. (Large group employers number eight and have about 87% of total pool employees.) Resource Training and BCBS calculated 2006 renewal rates based on: I 1.) claim experience of the small group pool 2.) claim experience of Elk River 3.) demographics of Elk River IRate History of Total Pool I Resource Training & Solutions: Insurance Pool Rate History Year Minimum Maximum Average 2006 Projections MN Care 5-7% 35-39% Large Group 0-2% 30-32% 2005 I MN Care 3.0% 24.0% Large Group 2.8% 11.6% 2004 3.0% 24.5% 10% 2003 5.0% 20.0% 9.4% 2002 4.0% 25.0% * *Information unavailable at time of printing. IIIII 1