HomeMy WebLinkAboutInsurance Committee Minutes 04.14.2014 HEALTH INSURANCE COMMITTEE
Monday, April 14, 2014
2:00 P.M. @ City Hall
Members Present: Heidi Jensen Tom Nelson
Shirley Ewan Cathy Gabrian
Stan Langve Jason Shovar
Bruce McGee
Others Present: Dave Allen Shellie Wherley
The meeting was called to order by Heidi at 1:45 p.m.
Jason talked to Union #316 and they would like to shop around this time. Jason said he is scared to go
into a new policy and then find out it is not good one down the road.
Stan said we need to compare policies and then it is easier to swallow if you know what they all provide.
Heidi said we cannot shop this year. The committee has not met on a regular basis and it is too late.
There was discussion that we had to hire an insurance broker a few years ago to decipher the bids. Jason
asked if this is Dave Allen's job to represent us if we shop and it was stated this is not what he does. He
represents BCBS and is the liaison for any kind of claims or billing problems our employees encounter.
Heidi said we may have to budget for hiring a broker next year.
Dave Allen and Shellie Wherley arrived at 2:00 p.m.
Shellie recapped our last meeting stating Big Sky Select may not be the best platform for cost reduction.
She was asked to bring back more options. The underwriters are concerned about adverse selection. They
provided options on high and low plans that keep the spread the same as we currently have. She
distributed a handout which included the two options from our last meeting and three additional ones.
The high deductible health plan pays preventative services but will not pay claims until the $2,500 OOP
is met. This is the same risk as our 70/30 plan where the combined deductible and co -pay are $2,500.
The city provides insurance if something major happens.
Shellie pulled some statistics for a nine month period from July 2013 through March 2014 to help us
understand how our plan is being utilized.
• Claim usage - $0 - $500 = 40% of employees; 36% of spouses; 64% of children
• Claim usage - $0 - $1,000 = 56% of employees; 58% of spouses; 71% of children
• Between 10% - 20% of employees use 80% of benefit
• Combined group - $0 - $500 = 49%
• Combined group - $0 - $1,000 = 62%
• Combined group — 12% - 18% utilizing 80% of benefit
• 2013 - 36 employees had less than $500 in claims filed
• 2012 - 44 employee had less than $500 in claims filed
Shellie would recommend Option 2 which gets the cost down and erases the proposed 10% increase.
Options 1 and 2 were reviewed at the previous meeting and in the minutes of March 31, 2014.
Insurance Committee Minutes
Page 2, April 14, 2014
Option 3 is a Blue Dimension 50/50 plan for the high plan; $35 OVC; $3,500 deductible; $5,000 OOP;
efficient RX full card $50 deductible. Blue Edge — HDHP as the low plan; $5,000/$10,000 — individual/
family deductible; integrated pharmacy benefit — 100 /0 co- insurance after deductible. It is the most
severe of the plans offered. If this option was offered, the city could think about offering up incentives,
possibly putting something into a health saving account and get the employees to start thinking about
medical savings.
Option 4 is Blue Dimension 60/40 for the high plan; $35 OVC; $2,000 deductible; $4,000 OOP; efficient
RX full card $50 deductible. Blue Edge — HDHP is the low plan; $3,500/$7,000 — individual/ family
deductible; integrated pharmacy benefit — 100/0 co- insurance after deductible.
Both high and low plans on Option 5 are Blue Dimension plans. The high plan is an 80/20; $25 OVC;
$1,000 deductible; $2,500 OOP; efficient RX full card $50 deductible. The low plan is 70/30; $35 OVC;
$1,500/$3,000 individual /family deductible; $3,500/$7,000 OOP; efficient RX $50 deductible.
With a health savings account, money put in and taken out is tax free. You need to keep receipts for
withdrawals and it can be rolled over from year to year. You can't contribute after age 65 but it does have
features that allow you to roll it over to an IRA.
A less rich benefit plan makes employees think about whether or not it is necessary to go to the doctor.
Shellie said there are resources and tools available to employees.
Heidi cautioned about employees looking stuff up on the internet and said the city requires a doctor's note
in order to be off more than three days. She said a lower plan with higher co -pay and deductibles is a
burden on a lot of employees.
Tom said people need to start thinking about saving money for medical expenses.
Shellie said all plans must meet ACA requirements, which is $6,350 out of pocket maximum. Costs are
slowing but still going up. Whatever we do in 2014, will affect next year. Dave said there may be some
cost adjustment to the maximum in future years by the administration.
Shirley feels that the only ones benefiting are the families and employee /spouse groups. The singles are
losing benefits and the employer pays more toward the other groups.
The committee decided to think about Options 1, 2 and 5 and asked the union representatives to take these
plans to their memberships.
Heidi will call another meeting as soon as we hear from BCBS on our final rate for FY 2014 -15.
The meeting adjourned at 3:07 p.m.
Respectfully Submitted,
Cathy Gabrian