Employee Benefit Trust Minutes - 04/08/2024 City of Wichita Falls
Employee Benefits Trust Board
Meeting Minutes
April 8th, 2024
The meeting was held in the Conference Room at Big Blue Tower, 719 Scott Ave, Wichita
Falls, TX 76301 .
Present: Tim Short, Mayor
Darron Leiker, City Manager
Kinley Hegglund, City Attorney
Christi Klyn, Director of Human Resources
Stephen Calvert, Chief Financial Officer
Angela Bosma, Employee Benefits Specialist II
Tamatha Kalick, HR Generalist/Employee Benefits Specialist
Brent Weegar, HUB Int'I, Senior Vice President, Public Sector
Blaze McCarthy, HUB Senior Account Manager
Heath Haigood, Account Executive, Public Sector
Agenda Items:
Meeting was called to order at 9:00 am
II. Minutes from the previous meeting on 10/12/23 were approved.
III. HUB International presentation (taken directly from the HUB 4/8/24 binder):
a. "Overview
i. Financial Results: The City of Wichita Falls' total per capita healthcare
cost increased by +7.5% at year end 2023. Per capita health claims
increased by +8% and prescription claims increased by +9% at year end.
Over the past 5 years, the City has achieved a 3.2% average claims
trend vs the nation at 7.1%.
For the 2023 plan year, there were 27 claimants over$75k accounting
for$3.6m or 33% of claims spend. In comparison, 2022 plan year, there
were 18 claimants over$75k accounting for$2.4m or 24% of claims
spend. There were $0 in stop loss reimbursements vs $466k in stop loss
premiums paid.
Through the first 2 months of the 2024 plan year, total per capita
healthcare costs have decreased -11% compared to the first 2 months of
the 2023 plan year. Per capita health claims have decreased -26.8%
and prescription claims have increased +20.8%. 2024 plan year to date
there is one claimant over$75k accounting for 19% of claims spend.
ii. Renewal: The City of Wichita Falls will renew all administrative and
insurance policies for the 2025 plan year. HUB will be releasing an RFP
on the City's behalf to evaluate market alternatives and negotiate long
term pricing, allowance and performance guarantees.
N. Moving forward: After evaluating benchmarking data and best practices,
the City recalibrated its health plan design for 2024, using fund balance
to improve its health plan offerings. For 2025, HUB is not recommending
any significant changes to health plan design but rather focusing on RFP
and vendor negotiations for the 2025 plan year.
b. Historical Cost Analysis
c. Utilization Review
d. Benchmarking
e. Budget Projection and Plan Options
f. Strategic Recommendations:
i. Financial Results: The City of Wichita Falls' total per capita healthcare
cost increased by +7.5% at year end 2023. Per capita health claims
increased by +8% and prescription claims increased by +9% at year end.
Over the past 5 years, the City has achieved a 3.2% average claims
trend vs the nation at 7.1%.
For the 2023 plan year, there were 27 claimants over$75k accounting
for$3.6m or 33% of claims spend. In comparison, 2022 plan year, there
were 18 claimants over$75k accounting for$2.4m or 24% of claims
spend. There were $0 in stop loss reimbursements vs $466k in stop loss
premiums paid.
Through the first 2 months of the 2024 plan year, total per capita
healthcare costs have decreased -11% compared to the first 2 months of
the 2023 plan year. Per capita health claims have decreased -26.8%
and prescription claims have increased +20.8%. 2024 plan year to date
there is one claimant over$75k accounting for 19% of claims spend
ii. Renewal: The City of Wichita Falls will renew all administrative and
insurance policies for the 2025 plan year. HUB will be releasing an RFP
on the City's behalf to evaluate market alternatives and negotiate long
term pricing, allowance and performance guarantees. We are projecting
the RFP draft to be sent to the City in April with release in May.
N. Budget: Projected fund balance for year end FY24 is expected to grow
over$744k and exceed $14.5 in the cumulative fund balance. HUB
recommends a minimum fund balance of 25% of total expense which is
$3.8m for FY24. For FY25 HUB assumed a 3% employer increase in
funding which will cover projected increases/expenses including no
employee contribution adjustments.
iv. Health Plan Design: The City made substantive enhancements to its
Health Plans in 2024. For 2025, HUB is not recommending any
significant changes to preserve good will from 2024. As we move
through the RFP process, we will provide a menu of options with savings
and member impact as we plan for 2025.
v. Contributions: For the 2024 Plan year the City is projected to fund
80.6% of the total cost of health care. The City funds 93.3% to employee
only and 71.7% to dependent coverage for the HSA plan. The City is
cost neutral between the HSA and CAT plans however funds more to the
PPO Core plan. If adjustments are needed, it is recommended for the
city consider increasing cost sharing to the PPO Core plan to incentivize
enrollment in the HSA and CAT plans.
vi. Health Clinic: IN 2024 the City moved its behavioral health professional
from part time to full time. The City & HUB will be meeting with Quad
Med on 4/17 to review the year end utilization report.
vii. Retiree Plans: As a best practice, the City applies separate risk adjusted
rates for the retiree health program which explicitly states the employer
and employee subsidy levels of retiree risk. Currently the City funds
between 59.0% and 56.4% of the retiree only premium and 0% toward
dependent coverage. The City has cost neutral funding between the
HSA and CAT plan however funds more to the PPO Core plan. It is
recommended to consider moving the PPO Core plan towards cost
neutrality over time.
viii. Dental: The Humana dental plan of benefits and funding structures are
in line with benchmarking. No significant changes are recommended at
this time.
ix. Vision: The fully insured Superior vision plan of benefits and funding
structures are in line with benchmarking. No significant changes are
recommended to the plan design or funding levels at this time.
x. Life and Disability: The life insurance is in line with benchmarking,
however it is recommended to evaluate increasing the $8,000 monthly
maximum benefit for the long-term disability plan during the RFP
process. HUB will provide options for the City's consideration.
xi. Other HUB Resources:
1. HUB Employee Advocate Hotline ($1.50 PEPM)
2. FinPath Financial Wellness Program (New optional HUB program
- $20 PEPY)
a. Certified Financial Counseling (1:1)
b. FinPath University Courses
c. Financial Health Tools
d. Low-interest loans
3. Compliance Updates:
a. ACA, ERISA, HIPAA, COBRA, etc. remain the law of the
land
b. COVID-19 guidance (largely expired)
c. Spending account (FSA, HRA, HAS) changes
d. Patient-Centered Outcomes Research Fee ($3 per covered
life per year) extended to 2029; adjusted annually
e. Increased focus on transparency
f. 2024 Predictions
g. Renewal Timeline"
IV. With no further business, the meeting was adjourned at 1125 hours.
Prepared by:
Angela D. Bosma, EBSII
City of Wichita Falls/HR Department