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Employee Benefit Trust Minutes - 11/03/1999 City of Wichita Falls Employee Benefits Trust Meeting November 3, 1999 { Present: Greg Humbach, Chair James Berzina, City Manager Jim Dockery, Finance Director Jan Stricklin, Employee Benefits Administrator Gail Garmon, Employee Benefits Coordinator The meeting was called to order by Mr. Humbach, Chair, at 2:35 PM. Jim Dockery made a motion to accept the minutes of the last meeting with no corrections. Jan Stricklin seconded the motion. Motion carried. Agenda Items: Financial Statement: Jan Stricklin presented the financial statement which reflected an approximately 1.3 million dollar increase in medical, dental and prescription costs over the previous year. After much discussion by the Board as to the rising cost of medical care, Ms. Stricklin presented to the board several proposals and plans that the Trust might consider to decrease expenditures for the following budget year. Among these proposals was the introduction of an additional plan option that would require all participants to use the On-Site Clinic before being referred to a specialist by Joe Bryan, PA and Tom Talbert, M.D. This would be a Preferred Provider plan which is managed care. Also, it was suggested that changes could be made in the current prescription card plan. Mr. Dockery stated that he would prefer to have more time to go over the proposals before making any decisions as to changes. Mr. Humbach and Mr. Berzina had similar concerns. Mr. Berzina suggested that Ms. Stricklin present her proposals at the agenda staff meeting on Monday, November 8, to get an overall feeling from the department directors as to how their employees might respond to the changes. Ms. Stricklin will also hold division head meetings to discuss changes. Actions were tabled until the next Employee Benefits Trust meeting to be held on Thursday, November 11, 1999 for further discussion of the proposed changes. The meeting was adjourned at 4:25 PM. City of Wichita Falls Employee Benefits Trust Meeting November 3, 1999 Present: ! Greg Humbach, Chair Tim Berzina, City Manager Jim Dockery,Finance Director Jan Stricklin, Employee Benefits Administrator Gail Garmon,Employee Benefits Coordinator The meeting was called to order by Mr. Humbach, Chair at 2:35 p.m. Jim Dockery made a motion to accept the minutes of the last meeting with no corrections. It was seconded by Jan Stricklin and the motion carried. Agenda Items: Financial Statement: Ms. Stricklin presented the financial statement with the first item being the Claims Comparison. Claims paid for the period of 10/01/98 through 09/30/99 were: Medical $3,417,471.54; Dental $228,556.24 and Prescription $663,254.05 for a total of $4,309,281.83, compared to a total of S3,349,951.68 the previous year. A $959,330.15 increase of paid claims with September 1999 being the highest claims submitted and paid of Medical $540,330.15; Dental $33,769.85 and Prescription $55,271.17 for a total of $541,632.85. The next item on the financial statement was a five year comparison of paid claims. MEDICAL DENTAL PRESCRIPTION TOTAL CARD 1994/95 $2,181,662.96 $129,412.86 - --------- $2,311,075.82 1995/96 $2,569,657.13 $142,366,95 --- ---------- $2,711,857.73 1996/97 $2,544,641.54 $146,366.95 -------------------- $2,691,008.49 1997/98 $2,782,116.72 $196,416.57 $371,418.39 $3,350,173.68 1998/99 $3,417,471.54 $228,556.24 $663,254.05 $4,309,281.83 Ms. Stricklin presented charts showing 1994/95 through 1998/99 budget years which shows the amount of total claims paid for employee, spouse, and dependent. She noted if we were fully insured, the Trust would not only pay those claims, but also any administrative fees that the company might charge. Being self-insured lowers the administrative costs. Jim Dockery made a motion to accept the financial report. Greg Humbach seconded. Motion carried. Discussion of cost sharing comparisons: After much discussion by the Employee Benefits Trust committee members as to the rising cost of medical care, Ms. Stricklin presented several proposals to assist in sharing the cost of claims. She also presented proposals for implementation to hold down expenditures for this budget year and future budget years. Among these proposals was the introduction of an additional plan to the current cafeteria plan offered to employees. This new plan would require employees selecting this plan to utilize the on-site clinic as primary care for some illnesses and a clearing house for referrals for other illnesses. This plan would not require an increase in employee paid premiums. Also, it was suggested that changes be made to the current prescription card plan to decrease expenditures. Mr. Dockery stated that he would prefer to have more time to review the proposals before making any decisions as to changes. Mr. Berzina and Mr. Humbach also wanted additional time for review. Mr. Berzina suggested that Ms. Stricklin present the proposals at the staff meeting on Monday, November 8, 1999, to get an overall feeling from the department directors as to how their employees might respond to the changes. It was then decided to adjourn for time to review proposals and hold staff meetings and to reconvene the meeting on Thursday, November 11, 1999 to further discuss the proposed changes. Meeting was adjourned at 4:25 p.m. The meeting was continued on November 11, 1999 at 11:00 a.m. Ms. Stricklin presented graphs showing the medical care costs of the plan for each month from October 1998 through September 1999. The expenditures for October through August remained fairly consistent with the previous year, between $250,000.00 to $350,000.00. The graphs show the expenditures large increase occurred in September with approximately$550,000.00 going to in-hospital care accounting for 51% of the cost. Ms. Stricklin discussed the department directors staff meeting responses and the meeting held with 21 division heads and supervisors. The responses were varied with the majority stating that the employees know that premium increases will occur and were surprised not to have been increased last year; the second largest response was that most employees will change from Plan B to Plan D and use the on-site clinic if we open more hours; the last response was that the City should pay for all benefits with the employee paying nothing. At Mr. Berzina and Mr. Dockery's request, Ms. Stricklin supplied a chart of costs to other cities and government entities from a variety of full insured insurance companies. The costs for those plans exceed the cost of the City's self-insured plans. She noted that October 1, 1998 the employees premiums were increased by $3.50 per month, per person, and that the employees had not been increased for four years before that time. Ms. Stricklin outlined proposed changes to cost sharing premiums, out of pocket totals, the addition of Plan D and changes to the current prescription program. Proposed implementation date of January 1, 2000. Mr. Humbach called for a motion. Ms. Stricklin made a motion to approve the proposed changes. Mr. Dockery seconded the motion. Motion carried. Old Business: As in the past with any plan changes approximately sixty-five meetings will be held to convey information of the plan changes and premium increases. New Business: There being no new business, the meeting was adjourned at 1:10 p.m. Respectfully submitted, ii -f4td4t) an Stricklin Employee Benefits Administrator WICHITA CLUTCH/DANA CORPORATION Employee Pays: $7.00 wkly for family/$364.00 yrly Corp. Pays: $360.00 monthly per employee/$4,320.00 yrly Dana is self insured/Unicare is 3rd party administrator Medical Deductible: $200.00 per person/$400.00 family Dental Deductible: $75.00 person/$150.00 family Plan pays 809%0/Out of pocket is $500 per person/$1000 family This is not a managed care plan. They can go anywhere. (this is a union run business)