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HomeMy WebLinkAbout08/11/1997 BAKERSFIELD Alan Tandy, City Manager Patricia J. DeMond, Chair Staff: John Stinson Mark Salvaggio Jacquie Sullivan AGENDA SUMMARY REPORT PERSONNEL COMMITTEE Monday, August 11, 1997 12:00 noon Risk Management Conference Room 1501 Truxtun Avenue Bakersfield, CA 93301 1. ROLL CALL Call to Order 12:15 p.m. Present:Councilmembers Patricia J. DeMond, Chair; Jacquie Sullivan and Mark Salvaggio 2. APPROVAL OF JULY 14, 1997 MINUTES Approved as submitted. 3. PRESENTATIONS None 4. PUBLIC STATEMENTS None 5. DEFERRED BUSINESS A. HEALTH PLAN MARKETING In response to a question about a request by an outside insurance consultant firm to address the Insurance Committee,' Mr. Stinson explained that the Insurance APPROVED AS SUBNITTED SEpTEIiBER 8, 1997 F~L[ ~0PY '~' -~ R~PORT AGENDA SUMMARY PERSONNEL COMMITTEE Monday, August 11, 1997 Page -2- Committee's purpose is part of the meet and confer process as established in the City's MOUs with the bargaining units, and as part of that process is typically not open to the public. Mr. Stinson stated that the request had been passed on to members of the Insurance Committee representing the bargaining units who expressed no interest in meeting with the consultant. Mr. Stinson discussed the marketing proposal submitted by AON Consultant Herb Kaighan. As the whole report (which is available in the City Clerk's Office) was voluminous, an executive summary was distributed which includes: · an overview of the City's plans · a renewal summary · elements of renewal · marketing summary · overall numbers for the different potential renewal options · a glossary of terms Committee Chair DeMond requested that a summary of the reasons why the vendors did not choose to bid be made available. Staff indicated the information will be provided. Mr. Stinson stated that staff, Mr. Kaighan, and a subcommittee of the Insurance Committee had met and reviewed the report. Mr. Kaighan also met with staff and the Insurance Committee. From the summary in the report, staff and the Insurance Committee made the following recommendations. · The Insurance Committee and staff recommend renewal of the Blue Cross Fee for Service Prudent Buyer Plan. Mr. Kaighan felt that the plan is competitive and would provide a reduction in rates of approximately 7.6 percent which equates to $216,000. · The Insurance Committee and staff are not recommending the Kaiser proposal which is a revised plan design utilizing a point of service (POS) approach. The concern is that this plan is a design change and does not include the same level of benefits we currently offer employees that were agreed upon in the meet and confer process. There would be a savings of $196,000 with the POS plan and staff is recommending that if the City is interested in this approach, Blue Cross be contacted for a POS proposal for comparison purposes. Committee Chair DeMond requested a synopsis of benefit comparisons between the POS plan and the City's current plan. · The Insurance Committee and staff are recommending renewal of the HMO Plan with Blue Cross CaliforniaCare. Mr. Kaighan's report shows the current plan to be competitive and projects a premium reduction of approximately 1.5 percent or $36,000. AGENDA SUMMARY ORT PERSONNEL COMMITTEE Monday, August 11, 1997 Page -3- · The Insurance Committee is not recommending adding the Kaiser HMO Plan as an additional HMO in addition to the existing CaliforniaCare HMO at this time. The Insurance Committee has concerns about the possible effects on future rates and impacts on the purchasing power with vendors if multiple HMO plans were offered. Mr. Stinson stated that there would be some cost savings to the City and to the participants with the Kaiser HMO plan, and some potential impacts on retirees if implemented. Committee Chair DeMond requested additional information on what the impacts/ loss of purchasing power might be in future years and savings, if the City were to offer a second HMO and also make it available to retirees and those on Medicare. Mr. Kaighan has additional information coming from Kaiser. · Medicare Risk programs with Blue Cross and PacificCare are competitive. Blue Cross has a new plan called Blue Cross Secure Plan III. The Insurance Committee is recommending contacting the six retirees that are currently in the Blue Cross medicare risk plan and ask which plan they prefer-- they must all be in the same plan. There is no cost difference to the City. · Blue Cross Indemnity dental is based on the City's claims experience. The report shows the renewal is reasonable and competitive and the Insurance Committee and staff recommend renewal of the Blue Cross Dental plan. · The two current prepaid dental plans provide good service to the participants and are competitive. The Insurance Committee and staff recommend renewal of HBI and DDS HMO dental plans. Mr. Stinson stated that the Insurance Committee has requested additional cost information regarding increasing the Blue Cross Indemnity dental plan annual maximum, due to inflation and the rising cost of dental services, from $1,000 to $2,000, which would be an annual cost to the City of $60,000. The annual maximum has been set at $1,000 for over fifteen years. The Insurance Committee also asked for cost information to increase the lifetime orthodontia benefit maximum from $1,500 to $3,000 per person, which would be an annual cost to the City of $51,000. Any of these changes would need to be reviewed further by the Personnel Committee, approved by Council and then based on Council direction, taken back to the Insurance Committee. Staff has concerns with increasing the orthodontia benefits since it could only benefit a small number of employees within the plan, and everyone would have to pay the increase. The Personnel Committee was supportive of increasing the Blue Cross Indemnity dental plan annual maximum from its current $1,000, but did not take any action. AGENDA SUMMARY ORT PERSONNEL COMMITTEE Monday, August 11, 1997 Page -4- Personnel Committee Chair DeMond requested that a retiree representative and an alternate be appointed to serve on the InSurance Committee, as the current representative has been unable to attend. A motion was made and approved that the health insurance marketing report be referred back to staff to follow up on requests for information and come back to the Committee at the next meeting. 6. NEW BUSINESS A. PLANNING TECHNICIAN RECLASSIFICATION (This item was heard before Deferred Business) As information is still being processed by staff, a motion was made by Committee member Salvaggio and approved by the Committee to defer this item. Staff was directed to keep Committee member Salvaggio advised as to progress and status. 7. ADJOURNMENT The meeting was adjourned at 1:50 p.m. Staff present: Assistant City Manager John W. Stinson; Human Resources Manager Carroll Hayden; Public Works Director Raul Rojas; Chief Assistant City Attorney Bob Sherfy; Benefits Technician Ginger Rubin. Others present: Herb Kaighan, AON Consulting; Wanda Lim, AON Consulting; Retiree Margaret Ursin; Clayton Koerner, Alliance Brokers and Consultants; Rodger Gagosian, Gagosian Associates; Jim Barks, FinHealth Services; Denny Haynes, S.E.I.U. Local 700, Chuck Waide, SEIU Local 700. cc: Honorable Mayor and City Council JWS:jp