HomeMy WebLinkAboutInsurance Committee Minutes 05.09.2011 HEALTH INSURANCE COMMITTEE
Monday, May 9, 2011
2:00 P.M. @ City Hall
Members Present: Donnie Nelson H.P. Nuernberger
Tom Nelson Kurt Markegard
Cathy Gabrian
Others Present: Dave Allen and Shelley Wherley
Kurt introduced Dave Allen and Shelley Wherley, BCBS, and said they were invited to meeting to answer any
questions. Dave explained that with BCBS, we are in a fully insured, fully pooled plan. The association we are in
is comprised of similar size groups. If we have a large claim, we can't be singled out and every group within our
pool gets the same rate increase. This protects us from large claims that our group may incur.
Shelley said the rate increase for our pool is 13.5 %. This is based on several things including trends and
utilization. The national medical trend increase is 13.2% next year. Our pool was started in 2007 and is
considered a mid -size pool with 5,000 members. It has had increases of between 8 -16% over four years.
With the passing of Obamacare, there are additional benefits that will have to be funded.
The quote the city received from JPT does not identify Levels A, B & C and does not address deductibles.
Employees would have to use the Deaconess system.
Kurt questioned how rates are set. Shelley explained they set the appropriate rate, based on each group's history,
coming in. The same rate increase is applied to every group, within the pool.
Kurt asked about utilizing a health saving account instead of paying for the insurance. He feels our premiums are
not appropriate. He said it is the committee's job to look at all viable options.
Dave and Shelley explained that when two very different plans are offered, you often have the healthier and
younger employees choose the lower premium plan. This can cause adverse selection which can affect the rate of
the other plan, often times seeing an increase in premium to keep up with claims that are not being adequately
funded.
At this time Dave and Shelley left.
Kurt said the city levies mills through the permissive levy, which covers the caps on insurance.
At the last meeting, we had a motion to continue with our current insurance for 30 days. The committee
discussed its options and questioned whether to continue looking at insurance and whether to meet each month.
Kurt asked if we should get a representative from EBMS to come to a meeting. If not, we need to put this to rest
for this year. We need to start this process in November or December next time.
H.P. said he will ask his membership what they want to do.
The meeting adjourned at 3:40 p.m.
Respectfully Submitted,
Cathy Ga rian