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Personnel Committee Date: 11/23/2010 By: Colleen Lasher Administrative Services Information Item #: 4. 2. Title: CONSIDER APPROVING THE 2011 CITY HEALTH INSURANCE CONTRIBUTIONS FOR NON -UNION EMPLOYEES Background: In a continued effort to manage health care costs over the long term, encourage consumerism, and provide adequate health insurance coverage to employees, staff is proposing that the city offerer the following HealthPartners' health plans for 2011: • $2000/$4000 deductible plan (Three for Free) • $1500/$3000 deductible plan • $25/100% copay plan Giving employees a larger role in healthcare decision -making through the use of deductible plans, wellness education, and encouraging the use of convenience care clinics are beginning to have a positive effect on the city's claims experience. This positive effect on claims experience should ultimately lower the city's healthcare costs. Per state statute, the city must negotiate its contribution to health insurance with union employees; therefore, when the city reaches tentative agreement with the AFSCME group, LELS Sergeants and LELS Patrol, that information will be presented to the City Council for consideration. Notification: No notifcation required for this action. Observations: Below are premiums for the 2011 health plans as well as employee deductible and maximum out-of-pocket costs. Staff is proposing the 2011 health insurance contribution levels in the table below for non -unison employees. City City Total EE Total Contribution Contribution COR Contribution Three for Free* Single ($2000 ded/$3000 OOP) Family ($4000 ded/$5000 OOP ) $1500 Deductible Single ($1500 ded/$3000 OOP) Family ($3000 ded/$o000 OOP) $25/T00% Single ($2500 OOP ) Family ($5000 OOP ) Premium to Premium to VEBA** Contribution to Premium $536 87 $536 87 $130 00 Soot) 87 $0 00 $134400 $81375 $19200 $100575 $53091 $554 65 $466 94 $130 00 $596 94 $87 71 $1389 14 $781 20 $192 00 $973 20 $007 94 $762 77 $517 14 $517 14 $245 03 $1909 59 $831 56 $831 56 $1078 03 *Each plan member receives three free office visits (physician services) annually m addition to the preventive care visit **The City's 2010 VEBA contnbution mcludes the $4 30 monthly claims fee Recommendation: Staff recommends that that Personnel Committee by motion recommend that the City Council approve the above -listed health insurance contributions for non -union employees. If approved, the monthly health insurance contributions will go into effect January 1, 2011. Council Action: