Employee Benefit Trust Minutes - 11/03/2005 CITY OF WICHITA FALLS
EMPLOYEE BENEFITS TRUST MEETING
November 3,2005
Present: Bill Sullivan, Chair
Darron Leiker, City Manager •
David Winney, Director of Human Resources
Gail Gannon, Employee Benefits Coordinator
Cassie Stennett, Broker
Marvin Traywick, Consultant
The meeting was called to order at 3:15 PM
Agenda Items:
Approval of Minutes
Bill Sullivan made a motion to approve the minutes of the previous meeting. Darron
Leiker seconded the motion. Motion passed.
Discussion of Proposals for Insurance Coverage/Plan Administration
Cassie Stennett presented a report showing the results of the claims paid for the year
December 04 through current, adding 15% for trend on the medical and prescription
totals and 10% on the dental total, plus a 25% corridor. This would be the expected
claims costs per employee for the coming year.
She then presented a report for the Stop Loss Renewal Analysis, for J. Allen Hall
Associates and Blue Cross Blue Shield/ING which showed that the Trust should budget
for the coming year at $8,443,000.00. She noted that this would be the worst case
scenario but that the expected would be closer to $6,500,000.00.
Her report outlined the current Stop Loss contract with J. Allen Hall Associates which
has an annual premium of $206,000.00 medical and $44,000.00 aggregate. The stop loss
figure on that contract is $200,000.00 plus a $25,000 deductible. The renewal for that
contract came in at $195,000.00 medical and $44,000.00 aggregate. The transplant limit
on the renewal contract would be $200,000.00 (up from $100,000.00) and $250 on
annual physicals(no previous limit).
The renewal for ING (good only through BCBS) came in at $183,000.00 (originally
$192,000.00 with a negotiated 5% discount) medical and $34,000.00 aggregate. This
contract would be for a projected annual maximum of $7,017,719.00. Cassie
recommended that the transplant benefit still be limited to $200,000.00 with the ING
contract.
She then presented the two proposed BCBS plans which will be referred to as PPO Hi
and PPO Lo. She outlined the differences in the two plans (see attached) from which
each individual enrolling would be asked to make a choice. It was noted that the two
proposed plans are modeled after other comparable plans used by cities of this size.
Cassie also presented information on what it now cost the City to administer the plan for
services such as repricing, case management, etc. and noted that those services would
now be included in the BCBS administration cost of$496,000.00. She added that BCBS
would not be willing to reduce their administration cost, but that the BCBS discounts,
which are considerably more than what the plan currently has access to, would save the
plan considerable money that would be used to build a reserve account. A report from
BCBS showed that their discounts in Texas are around 42.8% and they will guarantee the
City 40.7%on our claims for the first year.
Cassie also brought to the Board a proposal from Core Source, which was competitive,
but did not match the discount arrangement of BCBS.
Bill Sullivan inquired about notifying the City of Iowa Park of the discontinuation of
their claims administration. It was discussed that Iowa Park has a contract with their stop
loss carrier until July 1, 2006 which would necessitate our processing their claims until
then and that informing them now would give them ample time to arrange for a carrier to
take over their plan.
Cassie stressed that at enrollment, anyone waiving coverage should state the reason for
the waiver. The reason for the waiver is something that should be on record.
David Winney made a motion that the Board accept the INGBCBS stop loss proposal
and plan designs and award the plan administration to Blue Cross/Blue Shield. Jim
Dockery seconded the motion. Motion carried.
The Board then discussed the process of setting premiums for the two new plans. Cassie
noted that it would be up to the Board to set the premiums for each plan but that she
would help in making recommendations. The Board agreed to work on setting the
premiums at a minimal increase from those currently in place, at least for the PPO Lo
plan. It was agreed that the categories would be Employee, Employee/Spouse,
Employee/Child, and Employee/Family.
It was decided that mandatory enrollment meetings would be held in early December and
that they would be coordinated with representatives from BCBS and Alt Benefits to
explain both programs and enroll participants at the same meetings, with an effective date
of January 1, 2006. After further discussion it was decided that retirees, not on Medicare,
would be invited to the meetings and given the choice of the same two medical plans as
active employees. The plan would remain the Medicare Supplement for those on
Medicare.
Discussion of Proposal Responses from Clinic Care Services
Jim Dockery reported that he had received four responses to his request for bid proposals
for the clinic care services. He stated that one proposal was not at all competitive but that
the remaining three were good proposals and that he would like to invite representatives
from each of the three to a future meeting to discuss their proposals at length.
It was decided that Jim would notify each one by letter of the time and place for the
meeting.
Discussion of Retirees Adding Spouses to Coverage
At a previous meeting retirees adding dependents to the coverage was discussed but no
decision was made. Cassie stated that she felt that it should probably be handled the
same as employees adding dependents at enrollment time, but that she would check with
BCBS on how this should be handled.
Discussion and Possible Action on Section 125 Plan
Jim Dockery inquired as to the status of the debit card with the Section 125 Plan. Gail
Garmon said she felt Alt Benefits was unsure as to whether or not we wanted the card
and all that is necessary is to inform Alt that the card will be a part of our plan and they
will make the arrangements. Darron Leiker agreed that the card will be a part of the plan
and Alt Benefits will be notified.
Cassie then noted that she had emailed several suggestions for changes to the Prescription
coverage that the Board will consider and discuss at a later meeting.
The meeting was adjourned at 5:50 PM
Respectfully submitted,
Gail Garmon
Employee Benefits Coordinator