Speaker 6: Report from Human Resources recommendation to execute the renewal of contracts with seven health care providers for coverage of health, dental, vision, prescription and disability to maintain current benefit levels in compliance with state and federal laws on our plans citywide.
Speaker 2: Okay. Hold on. There's been a motion in a second. Councilmember Mongo.
Speaker 4: First, I want to thank our department and our city management for looking after the the health needs of our employees and their families. This is a very, very important matter. I think what's also an important matter is for us as a city to acknowledge that this is a $4.2 million annual increase over last year, according to staff reports that I've been reading. And if I'm incorrect in that, I'd be glad to be corrected. But with that, I'd like to see in the next several months that the Budget Oversight Committee start looking at this in advance of two weeks before our October enrollment. Both cost to employees and the city have increased over time, and we've shared that. And I think that we need a more comprehensive discussion about what options we have and what can be done. In six years we've experienced a $9.3 million increase, but in this last year, we've experienced a $4.2 million increase, and this only covers approximately 3900 employees in the city at this time. And so I think we just need to have a good amount of time in committee to discuss that. And so if council that the Vice Mayor Lowenthal is open to that, I'd like to request of the Human Resources Department city manager's office to prepare a report with the historical data and options that we have to ensure whether it's healthy lifestyle plans for our employees or Biggest Loser projects that other cities and counties have taken on to reduce those ongoing costs over time. I think this is a very important matter and needs to be discussed. It is $4.2 million increase, and I think that that's a big component that wasn't that wasn't put in the fiscal impact as much as you have to do the research to find that. So. But thank you for providing all the information. I think you've got an excellent job and a thorough job to be able to get to this point, to start the discussion. And I'd hope that Councilmember Lowenthal would take that on.
Speaker 2: Thank you.
Speaker 0: Councilmember Price.
Speaker 7: On that note, it does seem that, you know, the data that Councilmember Mongeau and I are referring to looks like it spans a period of time starting in 2009 until the president going into 15. And it looks like at some points there was a rise in the costs and at some point a decline. Can you, Ms.. Mills, maybe can you comment on what it is that is the cause of the current increase?
Speaker 5: Yes.
Speaker 4: Well.
Speaker 5: We have two plans. One is a PPO plan, which is a self-funded plan, and the second is an HMO plan, which is a fully insured plan. So on a fully insured plan, of course, we simply pay the rates to the provider. On the self-insured plan, we can have some variation from one year to the next, depending on how many large claims we might have. So that can have some impact. I would also say to speak to Council member Mungo's question. We do. And Cheryl is actually pointing out to me the Affordable Care Act could account for about was it 12.7?
Speaker 4: Or.
Speaker 5: 4.8% of the increase is actually the Affordable Care Act. So there are a lot of fees and. Taxes that the city is required to pay. And those were all folded in on the HMO side and the PPO side into the rate. So that accounts for some of the increase this year. And then we we do have a wellness program that's built into our plan. So we're certainly very mindful of trying to help our employees be more healthy and all in an effort to reduce cost. In the case of the prescription drug plan, one of the highest increases is prescription drugs, those specialty drugs. So we've put some plans in place in order to monitor those and make sure that they're being used in the best way possible and most cost efficient possible. But we can certainly provide a lot of detailed information on the plans.
Speaker 2: Dr. Bronson.
Speaker 1: Yes. I wanted to follow up on all those questions. I think your remarks were were pretty much on point. Councilmember Mongeau, I understand that the rising cost of health care has been a problem or been an issue for municipal government for many, many years. What I guess the question for staff is with this plan, what is the projected increase in the term of this current agreement? Generally there is that there's a built in factor of X percent a year of cost going up or down. Is that that factored in here in any way?
Speaker 0: Cheryl murray, our h.r.
Speaker 5: Officer will answer that.
Speaker 4: For the projected cost for the increase on the benefits plan for this year, the increase is roughly about 4 to 6% increase.
Speaker 1: Okay. And what does that mean in real dollars?
Speaker 4: In real dollars, as she stated, it has gone up from last year, approximately $4 million.
Speaker 1: Okay. And is is. And we understand under the Affordable Care Act, cost were supposed to stabilize. We re experiencing that at any way.
Speaker 4: We haven't gotten to the stabilization portion yet. We are required to pay the bakery fees, which we have done for the last two years, last year and this year. Coming up in 2016, we will be responsible for paying a reinsurance fee that's incorporated into our rates.
Speaker 1: Thank you so much.
Speaker 2: Thank you, Vice Mayor Lowenthal.
Speaker 4: I wanted to refer back to Councilmember Mango's comment, and I would be open to having that in the budget oversight. Is that a request to the makers of the motion to add that report? I wouldn't add it to the motion at this time, but more just a friendly request. I know that you manage the agenda of that committee. I would like to pass the item as it is in line. So we will go ahead and add that to the Budget Oversight Committee agenda. Thank you.
Speaker 2: Thank you, Councilwoman Pryce.
Speaker 7: I don't have anything. I apologize.
Speaker 2: Any public comment on this item? See, now there's a motion on the floor. Please cast your votes.
Speaker 6: Councilman Andrews. Motion carry seven zero.
Speaker 2: Thank you. Next item.
Recommendation to authorize City Manager to execute the renewal of contracts with Anthem Blue Cross, the City’s Third Party Administrator for the Preferred Provider Organization (PPO) and the Health Maintenance Organization (HMO) group health plans and Medicare Supplement plan; United Healthcare Medicare Advantage Plan; Scan Health Plan for the Medicare Advantage Plan; Delta Dental for the fee-for-service dental plan (DPPO); Medical Eye Services (MES) for the vision plan; CVS Caremark as the Prescription Benefit Manager (PBM) for the Prescription Drug Plan; Standard Insurance Company for life insurance and Long- and Short-Term Disability; and Union Mutual Life Insurance Company (UNUM) through Larry Lambert & Associates Insurance Services for the long-term care benefits; execute a contract with Delta Dental for the closed-panel dental plan (DHMO); and any subsequent amendments necessary to maintain current benefit levels and remain in compliance with state and federal laws on all plans.  (Citywide)