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Employee Benefit Trust Minutes - 10/04/2005 WICHITYA CITY F CHITYA FALLS I I EMPLOYEE BENEFITS TRUST MEETING October 4,2005 Present: Bill Sullivan, Chair Darron Leiker,Im City Manager Gail Garmon, Employee Benefits Coordinator Cassie Stennett,Broker Marvin Traywick, Consultant The meeting was called to order at 2:10 PM Agenda Items: Approval of Minutes Darron Leiker made a motion to accept the minutes of the last meeting with no corrections. Jim Dockery seconded the motion. Motion carried. Financial Statement (, Jim Dockery presented the financial statement. He noted that he estimates the plan will finish the year with approximately $7,000,000. in revenue and $6;500 000. in expenditures, leaving the plan with a surplus of approximately $300,000. to $450,000. He further explained that last year ended with a deficit of$200,000. after the City had contributed an additional $1,000,000. to the Plan. The City's projected increase in employer contributions for the upcoming year will add another $300,000. in revenue to the Plan. He noted that the Plans financial situation is better now than in the previous two years. United Regional Contract Jim Dockery, Bill Sullivan, and Marvin Traywick had met with representatives from United Regional Health Care Center to discuss the City's contracted discount arrangement and how it compares to the discount contracts of other carriers. United Regional explained that without an exclusive contract, they can only offer a 30% discount. The current discount is 25%. After discussion, the Board felt that it was better to go ahead and accept the 30% discount contract and to address the exclusivity aspect at some other time. The feeling was that if we do not have an exclusive contract with United Regional, then we can also go to Kell West Regional Hospital and get a 30% discount. Our current discount with Kell West is 20%. Jim Dockery explained that, based on current figures, the 30% would generate a savings of at least $120,000. for the Plan and a$50,000. savings to the patients. qr ti Jim Dockery also said that United Regional's suggestion was for the Plan to use Utilization Review and Pre-authorization procedures to curb costs. It was noted that the Plan does use these procedures, but only with regard to inpatient benefits. Cassie Stennett presented a report that suggested the procedures being performed are not the problem, but rather where the procedures are being done. Outpatient procedures done at a hospital are far more costly than these same procedures done at free standing facilities. The report dealt mainly with procedures such as MRI's, MRA's, etc. These procedures performed at free standing facilities vs. hospitals, are as much as 50% less. She noted that our Plan could require that certain procedures be done at a free standing facility. She further explained that our lab procedures could be done on the same basis, contracting with certain lab facilities for all lab work at greatly reduced fees, as much as 50-60% less. Bill Sullivan made a motion that the board accept United Regional's offer of a 30% discount, with all bills to be paid within 30 days, with no exclusivity arrangement, and that he be allowed to send United Regional a letter to this affect. Jim Dockery seconded the motion. Motion carried. Clinic Services Jim Dockery explained that he and his committee had written an RFP that he intended to send out to various providers asking for bid proposals for all clinic services currently being provided by our On-Site Clinic. He has asked that these proposals be returned for consideration no later than October 25,2005. Jim made a motion that the RFP be sent out for bids. Bill Sullivan seconded the motion. Motion carried. Bid for Insurance Marvin and Cassie explained that they had asked for bids from various insurance carriers for administration of the City's health plan, both from a third party administration and a fully insured standpoint. Cassie noted that once the proposals are in, she and Marvin would be able to come before the board and talk about plan design. She and Marvin both expressed the need to get away from the current four plan design and go to a two plan design, one with higher end benefits and one with lower end benefits. Marvin felt that most carriers would be reluctant to bid on a fully insured basis, but he thought they would get several bids for third party administration. t • • Marvin stated that some of the carriers were asking for an extension on the time frame for submitting bids. The board gave permission to extend it another week. Marvin expressed the need for the City to have 100% participation of all eligible employees in the plan in order to have the healthy as well as the sick. Cassie noted that this might be accomplished with a"core"plan, a catastrophic plan with a high deductible. The On-Site Clinic would be there for these individuals to take care of their basic needs, but in the event of an illness,they would still have coverage. Alt Benefits Bill Sullivan explained that the documents from Alt Benefits regarding our Flex Account • had been forwarded to him for review. He notified them of several minor changes that needed to be made. He will present those to the board when they have been revised. Retirees adding dependents Gail Garmon, Employee Benefits Coordinator, explained that in the past, a retiree was not allowed to add dependents after retirement. Only those spouses or dependents who were covered by the plan at the time they retired were eligible. She reported that several retirees had requested to be able to add new spouses to the plan and that one had asked that she present his request to the board for consideration. After discussion, the board decided to check into what the industry norm in this situation and to discuss it again at a later meeting. Jim Dockery summed up the meeting stating that the goals for the board are to evaluate the proposals for clinic services, get Alt Benefits flex spending accounts into operation and by January, be ready to offer a new and revised plan design. The meeting was adjourned at 4:20 PM. Respectfully submitted, 4Gail n -dC-06s--4}5 /1/4),t-- Employee Benefits Coordinator