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Home My WebLink About2006 City of Ba Calendar Year' Renewal Pres August 28, 2006.:~,?~?: explo .~ buekconsultants ~,:;:;;~...;~ ' Pa_cie · Renewal Results for Current Plans 3 · Results of Medical Marketing 10 · Comparison of CalPERS Plans 19 · Discussion 22 buckconsultants ~:'..' ....... company ,. an ACS nt Plans · Blue Cross requested increases of: - 15.0% for the active PPO plan - 0.0% for the retiree PPO plan - 11.8% for the active HMO - 39.8% for the retiree HMO (note that a significant part of this increase is due to the five year transition to unblended rates) - 0.0% for the dental plan · Buck was able to reduce the rate increases as follows: the active PPO increase was lowered to 8.0% and the HMO increases were lowered to 10.7% for actives and 38.4% for retirees. 3 buckconsultants ,:.i.i:,!iiiii,!:i::.:.i,,.,i!;i:I :: an ACS company Plans · Kaiser requested increases of: - 17.2% for the active plan - 17.2% for the under 65 retiree plan - A decrease of 15.7% for the Senior Advantage plan 4 buckconsultants ~, ~:ii!!',!;!'ii':!i:!!;::i'.':' i an ACS company ^ c ,. rrent Plans · All of the other benefit plans have requested minimal or no increases for 2007: - Dedicated Dental has requested a 1.5% increase - Pacific Dental has requested a 2.0% increase - Medical Eye Services has given the City a rate pass - PacifiCare Behavioral Health has given the City a rate pass · Overall the active plans are increasing by 8.9% and the retiree plans are increasing by 12.7%. 5 buckconsultants i!ii'i,:ilri!!'.:i..,i ..::!' .' an ACS company m m mm m m m m m mm m m m m m m m m mm m Plans Total Projected Increase Over Carrier CY 2007 CY 2006 Increase Premiums Premiums Actives Medical 10.1% $13,240,981 $1,209,881 Dental 0.5% $1,263,126 $6,205 Vision 0.0% $161,010 $0 Mental Health 0.0% $271,203 $0 Total 8.9% $14,936,320 $1,216,086 Retirees Medical 12.9% $3,578,349 $408,106 Dental 0.0% $0 $0 Vision 0.0% $13,266 $0 Mental Health 0.0% $35,567 $0 Total 12.7% $3,627,182 $408,106 Total All 9.6% $18,563,502 $1,624,192 6 buckconsuitants ~:~o~'~..~: .?~,.-~-..,:~,~.:~:~-~:..~-..~.,.. · ~ :: an ACS company m m m m m m m m m m m m m m m m m m m al Plans Initial Total Projected Increase Over Buck Total ProjectedIncrease Over Carrier CY 2007 CY 2006 Proposed CY 2007 CY 2006 Increase Premiums Premiums Increase Premiums Premiums Blue Cross PPO Active 15.0% $7,714,344 $1,008,562 8.0% $7,244,941 $539,159 Retiree 0.0% $1,853,612 $0 0.0% $1,853,612 $0 Blue Cross HMO Active 11.8% $4,229,418 $447,069 10.7% $4,187,058 $404,709 Retiree 39.8% $1,350,931 $384,460 38.4% $1,337,397 $370,926 Kaiser Active 17.2% $1,808,982 $266,013 17.2% $1,808,982 $266,013 Retiree 17.2% $327,932 $48,225 17.2% $327,932 $48,225 Sr Advantage -15.7% $59,408 ($11,045) -15.7% $59,408 ($11,045) Total 14.1% $17,344,627 $2,143,284 10.6% $16,819,330 $1,617,987 buckconsultants/& m m m m m m m m m m mm m m mm m m m m m Plans Total Projected Increase Over Carrier CY 2007 CY 2006 Increase Premiums Premiums Blue Cross 0.0% $914,584 $0 Dedicated Dental 1.5% $132,596 $1,977 Pacific Dental 2.0% $215,946 $4,228 Total 0.5% $1,263,126 $6,205 m m m m m m mm mm m m m m m m m m m m m and Behavioral Health Total Projected Increase Over Carrier CY 2007 CY 2006 Increase Premiums Premiums Vision Actives 0.0% $161,010 $0 Retirees 0.0% $13,266 $0 Total 0.0% $174,276 $0 Behavioral Health Actives 0.0% $271,203 $0 Retirees 0.0% $35,567 $0 Total 0.0% $306,770 $0 buckconsultants company an ACS : ng · Buck went to the Market to determine if the current Blue Cross offering was competitive. · We requested quotes from following vendors: - Blue Cross - Blue Shield - PacifiCare/United Health Care - CIGNA - Aetna - HealthNet · We received responses from Blue Cross, Blue Shield, and PacifiCare/United Health Care. · CIGNA, Aetna, and HealthNet declined to provide a response. : ng · The chart below compares the active rates for the quoted plans. Note that the benefits do not match the current Blue Cross benefits as shown on the following page. Enrollment Blue Cross Blue Shield PacifiCare PPO EO 148 $354.64 $488.36 $383.28 E1 220 $710.48 $908.15 $767.89 EF 370 $1,067.44 $1,416.26 $1,153.66 HMO EO 114 $347.52 $310.07 $331.85 E1 92 $698.42 $576.63 $666.90 EF 240 $1,021.04 $899.24 $974.98 Annual Cost $11,432,000 $13,203,624 $11,828,356 Cost Difference $1,771,625 $396,356 : ng · The HMO benefits quoted by Blue Shield and PacifiCare do not match the current Blue Cross plan. The differences are shown below. City of Bakersfield Quoted Plans Blue Cross Blue Shield PacifiCarc Office Copay $20 $20 $20 Inpatient Copay $250 $250 $125 Outpatient Surgery $0 $150 $0 Emergency Room Copay $100 $100 $50 Prescription Drugs Generic $10 $10 $10 Brand $20 $20 $20 :,ng The PPO benefits quoted by Blue Shield and PacifiCare do not match the current Blue Cross plan. The differences are shown below. City of Bakersfield Quoted Plans Blue Cross Blue Shield PacifiCare In-Net Out-Net In-Net Out-Net In-Net Out-Net Deductible Individual $250 $250 $250 $250 $500 Family $750 $500 $500 $500 $1,000 Out-of-Pocket Maximum In-network Individual $1,000 $3,000 $1,000 $1,000 $1,500 $3,000 Family $3,000 $9,000 $3,000 $3,000 $3,000 $6,000 Inpatient Hospital Copay $250 $250 $0 $0 $0 $0 Coinsurance 90% 60% 90% 70% 80% 60% Emergency Room Copay $100 $100 $100 $100 $150 $150 Prescription Drugs Generic $10 $10 $10 $10 $10 $10 Brand-Formulary $20 $20 $20 $20 $20 $20 Brand-Non-Formulary $20 $20 $35 $35 $30 $30 buckconsuitants/& :,ng Hospital Network Comparison - Kern County HMO PPO Hospital BC BS PacifiCare BC BS PacifiCare Bakersfield Memorial Y Y Y Y Y Y Delano Regional Medical Center Y Y Y Y Y Y Good Samaritan Hospital Y Y N Y Y N Healthsouth Bakersfield Rehabilitation Hosp Y Y N Y Y N Kern Valley Healthcare District Y Y Y Y Y Y Mercy Healthcare Bakersfield Y Y Y Y Y Y Ridgecrest Regional Hospital Y Y N Y Y N San Joaquin Community Hospital Y Y N Y Y Y Tehacapi Hospital Y Y Y Y Y Y · The table shows that the hospital network in Kern County is the same for Blue Cross and Blue Shield, but is not as large for PacifiCare. buckconsuitants/& :,ng HMO Physician Comparison- Kern County HMO Plans Provider Type BC BS Pa¢ifiCare Family Practice 67 59 66 General Practice 12 17 13 Internal Medicine 68 64 61 Obstetrics and Gynecology 37 30 28 Pediatrics 49 45 51 Allergy and Immunology 4 2 4 Cardiology 23 25 19 Dermatology 5 4 4 Gastroenterology 17 15 10 Neurology 18 19 11 Ophthalmology 14 14 14 Psychiatry 12 10 11 Surgery 56 33 55 Urology 9 5 7 All Other 348 331 319 Total 506 458 454 :,ng PPO Physician Comparison- Kern County PPO Plans Provider Type BC BS PacifiCare Family Practice 155 107 80 General Practice 58 35 28 Internal Medicine 166 125 105 Obstetrics and Gynecology 74 61 49 Pediatrics 86 58 48 Allergy and Immunology 4 4 10 Cardiology 39 32 21 Dermatology 11 13 9 Gastroenterology 17 15 18 Neurology 18 18 11 Ophthalmology 14 16 18 Psychiatry 15 20 3 Surgery 79 76 45 Urology 10 7 10 All Other 444 399 129 Total 1,190 986 584 : ng The prior two pages show that the Blue Cross network is slightly larger than both Blue Shield and PacifiCare for the HMO plan. · For the PPO plan, the Blue Cross network is significantly larger than the PacifiCare network and somewhat larger than the Blue Shield network. · If the City were to move from Blue Cross, there would likely be provider disruption due to the smaller networks for Blue Shield and PacifiCare. : ng · Based on the results of the marketing, we recommend the City remain with Blue Cross. Both the Blue Shield option and the PacifiCare option would cost significantly more than the Blue Cross plans. · Neither PacifiCare nor Blue Shield would match the current benefits offered by Blue Cross. In some situations, particularly for the PPO plans, the differences are significant. · Changing networks would cause significant employee disruption. ans · Buck was asked to provide a comparison of the City's plans to those offered by CalPERS. · The charts on the next few pages show the major benefit features and rates for CY 2007 for the City and CalPERS for the medical plans. · We have only shown the information for the active employees and for the CalPERS plans that are available in Kern County. buckconsultants ns - HMO Plans City of Bakersfield CalPERS Blue Cross Kaiser Blue Shield Kaiser Office Copay $20 $20 $10 $10 Inpatient Copay $250 $250 $0 $0 Emergency Room Copay $100 $100 $50 $50 Prescription Drugs Generic $10 $10 $10 $5 Brand-Formulary $20 $20 $15 $15 Brand-Non-Formulary n/a n/a $45 n/a Rates EO $347.52 $301.43 $407.02 $360.60 E 1 $698.42 $602.86 $814'.04 $721.20 EF $1,021.04 $853.05 $1,058.25 $973.56 2o buckconsuitants ,.?:,' company an ACS PPO Plans City of Bakersfield CalPERS Blue Cross PERS Choice PERS Care Deductible Individual $250 $500 $500 Family $750 $1,000 $1,000 Out-of-Pocket Maximum In-network Individual $1,000 $3,000 $2,000 Family $3,000 $6,000 $4,000 Out-of-network $3,000/$9,000 None None Inpatient Hospital Copay $250 $0 $250 Coinsurance In-network 90% 80% 90% Out-of-network 60% 60% 60% Emergency Room Copay $100 $50 $50 Prescription Drugs Generic $10 $5 $5 Brand-Formulary $20 $15 $15 Brand-Non-Formulary $20 $45 $45 Rates EO $354.64 $432.61 $731.40 E1 $710.48 $865.28 $1,462.80 EF $1,067.44 $1,124.86 $1,901.64 buckconsultants/ , Steps · The Insurance Committee elected to market the program to ensure that the current medical offerings were competitive. · As a result, Buck was able to negotiate with Blue Cross to obtain rates that were approximately $525,000 lower than would otherwise apply. · The marketing confirmed that Blue Cross is the most appropriate option for the City and its employees. · In addition, when compared to CalPERS, the City's rates are significantly lower for comparable HMO benefits and superior PPO benefits. 22 buckconsultants ~¢~, ~!;i.!':i!,i ii'~: ~'!, i :' an Acs company, .: ,. Page 1 of 1 3ean Parks - Re: Agenda for Personnel Committee Meeting From: Carroll Hayden To: Jean Parks Date: 8/11/2006 10:01 AM Subject: Re: Agenda for Personnel Committee Meeting Looks good to me. Thank you. >>> Jean Parks 8/11/2006 9:36 AM >>> Carroll, Ts the following okay? and do you have any other items? Please advise. A. Report on solicitation renewal results and Committee recommendation on 2007 Medical Insurance Plan - Hayden Thanks, Jean file://C:LDocuments and Settings\jparks\Local Settings\Temp\GW}00001.~ 8/14/2006 Page 1 of 1 Jean Parks - Re: Jean off From: Carroll Hayden To: Jean Parks Date: 8/3/2006 10:15 AM Subject: Re: Jean off I have now informed the Insurance Committee. >>> Jean Parks 8/1/2006 4:56 PM >>> Carroll I will be out of the office tomorrow, Wednesday, August 2, and will be back on Thursday, August 3rd. Please let me know when you have informed the Insurance Committee, etc. so I can send out an e-mail to dept heads and secretaries to let them know thero is a Personnel Committee meeting scheduled. Thanks Jean :) file://C:kDocuments and Settings\jparks\Local Settings\Temp\GW}00001 .HTM 8/3/2006 Page 1 of 1 Jean Parks- Re: Fwd: Bakersfield/Mtgs. w/Committees From: Alan Tandy To: Jean Parks Date: 7/31/2006 9:37 AH Subject: Re:'Fwd: Bakersfield/Mtgs. w/Committees CC: Carroll Hayden By copy of this I will advise Carroll that it can be scheduled but I want a staff briefing and meeting-well in advance of a committee or insurance committee presentation- Buck has had a tenancy to be last minute- but not for this! >>> Jean Parks 7/31/06 8:23 AM >>> Alan, Carroll forwarded the attached email-from Buck. Carroll has asked that a Personnel Committee meeting be set. Please advise. Thanks, Jean >>> Carroll Hayden 7/28/2006 3:31 PM >>> Buck wants to do a Personnel Cte. meeting and these are the dates they have available. Will any of them work? file://C:~Documents and Settings\jparks\Local Settings\Temp\GW}00001 .HTM 7/31/2006 Bakersfield/Mtgs. w/Committees Page 1 of 1 Jean Parks - Bakersfield/Mtgs. w/Committees From: "Neudeck Vivian" <Vivian.Neudeck~buckconsultants.com> To: "Carroll Hayden (E-mail)" <chayden~ci.bakersfield.ca.us> Date: 7/25/2006 11:18 AM Subject: Bakersfield/Mtgs. w/Committees CC: "Beck Timothy D" <timothy.beck@buckconsultants.com>, "Schionning Michael W" <michael.schionning~buckconsultants.com> Hi Carroll: We want to get on everyone's calendar sometime during the last 2 weeks of August in order to present the Solicitation and Renewal Results. Here the specific dates that we can meet with the City's Committees: Wed. Aug. 23 Thurs. Aug. 24 Fri. Aug. 25 Mon. Aug. 28 Thurs. Aug. 31 Fri. Sept. 1 Please let us know which date works for the City as soon as possible. Thanks, Vivian Vivian D. Neudeck Senior Health Et Welfare Consultant buckconsultants, an ACS Company 1801 Century Park East, Suite 500 Los Angeles, CA 90067 phone: (310) 282-8232 I fax: (310) 282-0881 email: vivian.neudeck®buckconsultants.com file://C:~Documents and Settings\jparks\Local Settings\Temp\GW} 00002.HTM 7/31/2006 Bakersfield/Mtgs. w/Committees Page 1 of 1 Jean Parks - Bakersfield/Mtgs. w/Committees From: "Neudeck Vivian" <Vivian.Neudeck~buckconsultants.com> To: "Carroll Hayden (E-mail)" <chayden~ci.bakersfield.ca.us> - Date: 7/25/2006 11' 18 AM - Subject: Bakersfield/Mtgs. w/Committees ~ CC: "Beck Timothy D" <timothy.beck~buckconsultants.com>, "Schionning Michael W" <michael.schionning~buckconsultants.com> Hi Carroll: We want to get on everyone's calendar sometime during the last 2 weeks of August in order to present the Solicitation and Renewal Results, Here the specific dates that we can meet with the City's Committees: Wed. Aug. 23 Thurs. Aug. 24 Mon. Aug. 28 "Thurs./~ug. 31 ~ Fri. Sept. 1 Please let us know which date works for the City as soon as possible. Thanks, Vivian Vivian D. Neudeck Senior Health Et Welfare Consultant buckconsuttants, an ACS Company 1801 Century Park East, Suite 500 Los Angetes, CA 90067 phone: (310) 282-8232 I fax: (310) 282-0881 emaii: vivian.neudeck®buckconsultants.com file://C:~Documents and Settings\jparks\Local Settings\Temp\GW}00005.HTM 7/28/2006 Page 1 of 1 Jean Parks - RE: Date for Personnel Committee meeting From: "Jacquie Sullivan" <jacquiesullivan~sbcglobal.net> To: "'Jean Parks'" <Jparks~bakersfieldcity.us> Date: 5/26/2006 3:27 PM Subject: RE: Date for Personnel Committee meeting YES Jean. Thursday, June 22nd, at 11:00 - is fine for me. Thanks, Jacquie I will put it in my book.. From: Jean Parks [mailto:Jparks@bakersfieldcity.us] Sent: Friday, May 26, 2006 1:54 PM To: jacquiesullivan@sbcglobal.net Subject: Date for Personnel Committee meeting Carroll Hayden needs to set up a Personnel Committee meeting for the 2006-07 Medical Insurance Plan, Harold said he can meeting on Thursday, June 22nd at 11:00 a.m. Would you be able to meet at that time? Zack just e-mailed and said it is okay with him. Let me know if that date and time works for you. Thanks, Jean file://C:\Documents and Settings\jparks\Local Settings\Temp\GW} 00001 .HTM 5/26/2006 Page 1 of 1 Jean Parks - Re: Personnel Committee Meeting Ii From: Alan Tandy To: Jean Parks Date: 5/25/2006 10:21 AM Subject: Re: Personnel Committee Meeting ok >>> Jean Parks 5/25/06 10:19 AM >>> 2006-07 Medical Insurance Plan. Carroll wants to have the consultant come and also have an Insurance Committee meeting. >>> Alan Tandy 5/25/2006 10:16 AM >>> I would like to know what agenda topic she has please >>> Jean Parks 5/25/06 10:13 AM >>> Alan, Carroll said we need to schedule a Personnel Committee meeting. Okay to Proceed? Jean file://C:\Documents and Settings\jparks\Local Settings\Temp\GW}00002.HTM 5/25/2006 /