HomeMy WebLinkAbout08/16/2016________________________________________________________________
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B A K E R S F I E L D
Committee Members
Staff: Steven Teglia Councilmember, Ken Weir, Chair
Assistant City Manager Councilmember, Terry Maxwell
Vice Mayor, Harold Hanson
SPECIAL MEETING OF THE PERSONNEL COMMITTEE Tuesday, August 16, 2016 12:00 p.m. City Hall North – Conference Room A 1600 Truxtun Avenue Bakersfield, CA 93301
AGENDA SUMMARY REPORT
Meeting called to order at 12:00 p.m.
1. ROLL CALL
Committee members: Councilmember, Ken Weir, Chair
Councilmember, Terry Maxwell
Vice Mayor, Harold Hanson
City staff: Alan Tandy, City Manager
Steven Teglia, Assistant City Manager
Chris Huot, Assistant City Manager
Christopher Gerry, Administrative Analyst, City Manager’s Office
Caleb Blaschke, Management Asst. – City Manager’s Office
Virginia Gennaro, City Attorney
Nelson Smith, Finance Director
Lisa McGranahan, Human Resources Manager
Mari Blowers, Benefits Technician
Retired employees Fred Baugher
and BCARE:
Others present: Tom Morrison, Jerry Huang, and Johnny Wu, Segal Company
/s/ Steven Teglia
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2. ADOPTION OF SEPTEMBER 18, 2015 AGENDA SUMMARY REPORT
The Report was adopted as submitted.
PUBLIC STATEMENTS There were no public statements. 3. NEW BUSINESS
A. 2017 Health Care Plan Renewals - Teglia
Assistant City Manager Teglia stated Segal Company had been working with
the various plan providers to obtain an understanding of the rates for the new
plan year, which begins in January 1, 2017. The same information was provided
to the Insurance Committee earlier in the day. He introduced Tom Morrison
with the Segal Company to present their report by way of a handout and
PowerPoint presentation. The report included information from the Request For
Proposals (RFP) for the vision and dental plans.
Mr. Morrison distributed information to the Committee and gave a summary
overview. Key points are:
The overall City 2017 contribution for active employee medical benefit is
increasing 3.7% or $557,200. The Blue Shield PPO had no increase, while
Blue Shield Full HMO (+6.8%), Blue Shield Narrow HMO (+3.9%), Kaiser
HMO (+9.5%), and Kaiser High Deductible Health Plan (+6.1%) all had
increases.
For retirees the proposed rates for the Blue Shield PPO is increasing by
4.1% while the Blue Shield Medicare Advantage plan rates decreased by
22%. Comparatively, Kaiser’s proposed rates for the HMO, High
Deductible, and HMO Senior Advantage plans are also increasing by
15.1%, 14.8%, 1% respectively.
There is no rate increase to the Flexible Benefits, Long Term Disability and
AD&D Life Insurance. The Basic Life Insurance plan is increasing by 27.5 %
increase. Segal recommended that a RFP be issued for the basic life
insurance plan in 2018 to determine whether a more cost competitive
provider exists.
A RFP for dental and vision plans were issued. It requested vendors
submit proposals that match the current benefit plans. The results
provide savings opportunities for the City and employee to maintain the
current benefits at a lower cost.
The favorable renewal increase will help lower the City’s liability for Other
Post-Employment Benefits when the next valuation is performed in June
of 2018.
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To summarize the Dental Plan RFP:
The RFP was sent to Anthem, Delta Dental, Liberty Dental, Met Life,
UnitedHeathCare, United Concordia, and Western Dental. All providers
submitted responses for the PPO and DMO plans with the exception of
Western Dental who submitted a response only for the DMO plan.
Anthem, Delta Dental, Liberty Dental, Met Life, UnitedHeathCare, and
United Concordia submitted financially competitive proposals for the
PPO plans. Liberty, UnitedHealthCare, United Concordia, and Western
Dental submitted financially competitive proposals for the DMO plans.
The United Concordia proposal provided the overall best benefit,
network and cost to the City and its participants. The active and retiree
DMO plans can be consolidated into one plan for each group from the
current two plans, at an improved benefit for retirees and cost saving to
the majority of retirees, active employees, and the City.
Financial Analysis for PPO Plans
- Active employees – the current premiums are $1.2 million. Proposals
received ranged from $961,000 to $1,144,800 or a 7.7% to 22.5 % cost
savings. All proposals are for a three year flat rate guarantee with the
exception of UnitedHealthCare whose proposal was for a two year
flat rate guarantee.
Financial Analysis for DMO Plans
- Active employees and retirees – the current premiums are $415,800.
The proposals received ranged from $320,100 to $419,500 or a 23%
decrease to a 0.9% increase of current premiums. The lowest bidder
however, had the most restricted network as well. All proposals are
for a three year flat rate guarantee.
To summarize the Vision Plan RFP:
The RFP was sent to Anthem, Blue Shield, Eye Med Services, MES Vision,
Met Life, UnitedHealthCare, and VSP requesting providers submit
proposals to match current benefit plans. All providers, except
UnitedHealthCare, submitted responses. Anthem, Blue Shield, Eye Med
Services, and MES Vision submitted financially competitive proposals for
a three year flat rate guarantee.
The two lowest cost proposals were submitted by Eye Med Services (20%
cost savings) and MES Vision (8% annual cost savings), $29,600 and
$11,900 respectively. Of the two, MES Vision had the larger network in
Kern County. For this reason, it was determined that MES Vision’s
proposal was the better option.
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Assistant City Manager Teglia reported that after careful consideration and
thorough discussion, the Insurance Committee voted unanimously to
recommend the following:
Medical Coverage – the Blue Shield and Kaiser plans;
Dental Coverage – United Concordia plan; and
Vision Coverage – Retaining MES Vision.
Staff and the Segal Company were also in agreement with the Insurance
Committee’s recommendation.
Committee member Hanson thanked staff and the Segal Company for all their
work in particular for communicating the necessary information to all the
interested parties. He made a motion to accept staff’s recommendation and
submit the item for approval to the full City Council. The motion was
unanimously approved.
Committee Chair Weir inquired about what will happen to the Blue Shield plans
after the current three year flat rate guarantee expires at the end of 2017.
Mr. Morrison stated Blue Shield opted to pass on any rate increases and
determined it was justified based on claims submissions.
Committee Chair Weir thanked staff and the Segal Company for their efforts.
He also expressed his satisfaction with dealing with Blue Shield.
3. COMMITTEE COMMENTS
There were no committee comments.
4. ADJOURNMENT The meeting was adjourned at 12:35 pm