HomeMy WebLinkAbout2016 Health-Dental Summary.151021.pdf2016 Health/Dental Benefits
Renewal rates for the same health option we currently have, came back with a
10.94% increase originally
o We were able to negotiate to an 8.45% increase (two year total increase
6.45%).
Renewal rates for the same dental option we currently have, came back with a
32.41% increase
o Providers have experienced losses on dental for the prior 6 years
Explanation of Increases:
Health
High Prescription drug utilization (Paid dollars increased 10.13% thru September)
Cost of health care has risen on average 12% nation wide
o Medical benefits paid in our plan have risen 9.72% through September.
(Loss ratio through August is an average of 81% (85% considered break-even)
Dental
Increased benefits 6 years ago
o Individual Benefit Period Max. raised to $2,500 from $1,500
o Ortho. Lifetime Max. for eligible dependent children raised to $2,000 from
$1,500
High utilization of the benefit has been experienced-in order from highest paid out
is Restorative, Diagnostic, Preventive, and Orthodontics. (We are beginning to
trend more favorably, but at a loss ratio of 92% through August)
Recommendations:
Health
Implement a $250 annual deductible per insured for prescription drugs
(accumulates toward overall prescription out of pocket limit of $2,000/$4,000 family)
o Deductible does not apply to generic drugs (only brand name)
Brand name is only 10% of prescriptions, but 69% of the cost
o Prescription co-pays would move to $10, $30, $50 (currently $10, $25, $40)
Dental
Surcharge the Blue Cross PPO Dental by an additional 5% (projected savings to
city over $12,300)- Cheaper option still available with Dental Blue Connect
Do not implement lowering the plan back to $1,500 period maximum and $1,500
Ortho. Maximum, which would save about $14,000
Recommended Employee Premiums
Option # 4 See Proposal Details-All options reviewed by Employee Committee
Option # 5 would also be available for the employees to choose from
Authorization is needed from the City Council to approve the 2016 renewal and
recommended employee rate changes above
If the above renewal was approved it would result in the following:
o 4.93% increase to city
o 12.46% increase to employees
o 5.91% total increase
o An increase in the savings of $37,700, moving balance to $134,300