Governing Board Recommendation Packet Employee Benefit Plans

Transcription

1 Governing Board Recommendation Packet Employee Benefit Plans Plan Year July 1, 2015 June 30, 2016 Presented by: March 11, 2015 G:\WINAPPS\5GRPACTS\Florence Unified School\2015\Meetings\ Governing Board meeting\15 Florence Board Recommendation Packet 0306.pdf

2 Employee Benefits Plan Highlights & Recommendations Plan Year: July 1, 2015 June 30, 2016 Recommendations: Formal RFP process conducted on all products/services listed below: Medical Health Savings Account Administration Employee Assistance Program Basic Life/AD&D and Voluntary Dependent Life COBRA Administration Medical Two vendors provided proposals. Based on analysis of benefits, networks, and cost, Insurance Committee recommendation to award to current vendor, ASBAIT. The insurance committee and administration, aware of the fiscal challenges to the District, provide two options for board consideration: o o Option I would generate 153,000 annual savings to the District. This involves changing some of our current plans and eliminating the Platinum Plan. Two of the three plans recommended would be at no cost to the employee for single coverage. Option 2 would generate 459,000 annual savings to the District. Just one plan in this scenario would be a no cost alternative for single employee coverage. o Current district contributions to the HSA plan 1300 (1248 annually) would be reduced to 576 annually if Option 1 is chosen. All rates and benefits contained in this proposal are based on the information, claims (if provided) and employee census data submitted in the original request for proposal to the various vendors. Further, the summary is based upon our understanding of the benefit and rate information provided from the insurance companies or other vendors. The insurance company s master contract will govern in the event of a discrepancy East Chandler Boulevard Building 1, Suite 103 Phoenix, AZ Fax

3 Health Savings Account Administration Seven vendors provide proposals. Insurance Committee recommendation to award to new vendor, Health Equity via ASBAIT, assuming the HSA plan is offered as in Option 1. Current vendor, HSA Bank, charges employees 2.25 per month. The monthly charge is eliminated with Health Equity. Employee Assistance Program Four vendors provided proposals. Insurance Committee recommendation to award to current vendor, Alliance Work Partners via ASBAIT. This is no cost to the District and no change from current benefit. Basic Life/AD&D and Voluntary Dependent Life Five vendors provided proposals. Insurance Committee recommendation to award to new vendor, Symetra. District will save approx. 5,400 per year on Basic Life vs current premiums (approx. 16,000 over the 3 year rate guarantee). Employee voluntary life rates will not change from current and are guaranteed for 3 years. COBRA Administration Five vendors provided proposals. Recommendation to award to current vendor, P&A Group, with no fee change, guaranteed for 5 years. All rates and benefits contained in this proposal are based on the information, claims (if provided) and employee census data submitted in the original request for proposal to the various vendors. Further, the summary is based upon our understanding of the benefit and rate information provided from the insurance companies or other vendors. The insurance company s master contract will govern in the event of a discrepancy East Chandler Boulevard Building 1, Suite 103 Phoenix, AZ Fax

4 Teladoc Recommendation to implement Teladoc as a District paid benefit to anyone who enrolls in medical coverage. This program is available through Bagnall s Mohave contract. No cost to employees (or their dependents) for video or telephonic medical consultation. However, employees would pay for any prescribed medications. Benefits to the District: o Claims for the consultation no longer hit your group medical plan claims (prescription claims will hit your group plan claims). This may reduce your medical loss ratio and help with lower group medical plan increases. o Possible reduction in absentism as employees have access remotely to this service vs. taking ½ or full sick days for doctor appointments. o Increased morale Benefits for your employees: o No cost for the consultatation o Dependents do NOT have to be enrolled under the employee s group medical plan for consultation with Teladoc o Unlike a 24/7 nurse line offered by group medical plans, Teladoc s Board- Certified phyisicians are authorized to write prescriptions. o Could reduce sick/pto day use Cost is 2.50 Per Employee Per Month (PEPM). Based on most recent month s medical enrollment of 736, annual cost to District of 22,080. Dental Renew both Dental plans with current vendor, Total Dental Administrators. Dental PPO original increase of 18%, renegotiated to 9%. Prepaid Dental increase of 2%. All rates and benefits contained in this proposal are based on the information, claims (if provided) and employee census data submitted in the original request for proposal to the various vendors. Further, the summary is based upon our understanding of the benefit and rate information provided from the insurance companies or other vendors. The insurance company s master contract will govern in the event of a discrepancy East Chandler Boulevard Building 1, Suite 103 Phoenix, AZ Fax

5 Vision Renew with current vendor, Avesis. Second year of three year rate guarantee no benefit changes. Short Term Disability Renew with current vendor, Lincoln Financial. Second year of two year rate guarantee no benefit changes. Flexible Spending Account Renew with current vendor, P&A Group. No fee change, 2 nd year of 5 year fee guarantee. AFLAC Individual Supplemental Policies Continue to offer AFLAC to employees. Rates vary based on benefits and coverage selected. PPACA Recommendation to amend all employee benefit contracts effective 7/1/15 to allow only employees who meet PPACA variable hour requirements to enroll in the medical only. PPACA variable hour employees will not be eligible for non-medical benefits. All rates and benefits contained in this proposal are based on the information, claims (if provided) and employee census data submitted in the original request for proposal to the various vendors. Further, the summary is based upon our understanding of the benefit and rate information provided from the insurance companies or other vendors. The insurance company s master contract will govern in the event of a discrepancy East Chandler Boulevard Building 1, Suite 103 Phoenix, AZ Fax

6 Medical Plan Proposals Value Silver HDHP 1,300 Classic Silver Value Bronze Value Silver Classic Silver District Sponsored Plan OPTION 1 OPTION 2 576/yr ER H.S.A. Contri. Buy Up Plan District Sponsored Plan Actual Per Month H.S.A. ER Annual Contribution Actual Annual 5, , , , , , Employee's per month Employee's per 22 pays Employee's per 18 pays District Annual 4,059, ,059, ,059, ,753, ,753, ,753, District Annual 4,212, ,212, ,212, ,212, ,212, ,212, Annual Savings 153, , , , , , Buy Up Plan Buy Up Plan Based off of annual enrollment of 750 EE's District Annual is based on per 750 EE's 6

7 Medical Benefits & Rates Plan - Option 1 Lifetime Maximum Deductible Individual Family Coinsurance Out-of-pocket Maximum (Includes Deductible, Medical and Rx copays) Value Silver (1) HDHP 1,300 Classic Silver (1) (Non-Embedded Deductible) (3) In Network Out of Network In Network Out of Network In Network Out of Network Unlimited 750 Not Covered (2) 1,300 if enrolled as 2,500 if enrolled as 350 1,400 employee only employee only 750 per person Not Covered (2) 2,600 if enrolled and 5,000 if enrolled and 1,050 4,200 covering any dependents covering any dependents 25% Not Covered (2) 20% 50% 20% 50% Includes Deductible, coinsurance, medical and rx copay Includes Deductible, coinsurance, Medical and Rx copay Includes Deductible, coinsurance, medical and rx copay Individual 6,000 Not Covered (2) 6,000 if enrolled as 18,000 if enrolled as 4,500 Unlimited employee only employee only Family 12,000 Not Covered (2) 12,000 if enrolled and 28,000 if enrolled and 9,000 Unlimited covering any dependents covering any dependents Hospital Services Inpatient Hospital 250 copay; then 25%* Not Covered (2) 250 copay; then 20%* 50%* 250 copay; then 20% 300 copay; then 50%* Outpatient Hospital 25%* Not Covered (2) 20%* 50%* 20%* 50%* Emergency Room 25%* 25%* 20%* 20%* 20%* 20%* Urgent Care 50 copay; then 25% Not Covered (2) 50 copay; then 20%* 50%* 50 copay; then 20% 50 copay; then 50%* Routine Services Office Visit 40 copay Not Covered (2) 20%* 50%* 30 copay 50%* Specialist Visit 50 copay Not Covered (2) 20%* 50%* 40 copay 50%* Routine Physical/Wellness/Well Child Care 0 Not Covered (2) 0% 0 copay Prescription Drugs Deductible None Yes, medical deductible None Tier 1 15 copay Not Covered 20%* 15 copay Tier 2 Preferred Brand 20% copay (Minimum 25 - Maximum 80) 20%* Preferred Brand 20% copay (Minimum 25 - Maximum 80) Tier 3 Tier 4 (Specialty) Non-Preferred Brand 30% copay (Minimum 40 - Maximum 110) 20% copay (Minimum Maximum 150) 20%* Non-Preferred Brand 30% copay (Minimum 40 - Maximum 110) N/A 20% copay (Minimum Maximum 150) Mail Order Mandatory Generic Tier 1 30 Copay Not Covered 20%* 30 copay Tier 2 Preferred Brand 20% copay (Minimum 50 - Maximum 175) 20%* Preferred Brand 20% copay (Minimum 50 - Maximum 175) Tier 3 Non-Preferred Brand 30% 20%* Non-Preferred Brand 30% Tier 4 N/A N/A N/A Value Silver HDHP 1,300 Classic Silver Employee Only Employee + Spouse Employee + Child(ren) Employee + Family * Deductible Applies , , , (1) Routine care covered 100% up to 300 per calendar year, then 10% (2) if outside the network. Inside AZ members to use Blue Cross network, outside AZ members to use Aetna network. (3) For family coverage, the entire family deductible must be met before any copay or coinsurance is applied any individual family member. 7

8 Medical Benefits & Rates Plan - Option 2 Lifetime Maximum Deductible Individual Family Coinsurance Out-of-pocket Maximum (Includes Deductible, Medical and Rx copays) Individual Family Value Bronze (1) Value Silver (1) Classic Silver (1) In Network Out of Network In Network Out of Network In Network Out of Network Unlimited Unlimited 3,000 Not Covered (2) 750 Not Covered (2) 350 1,400 9,000 Not Covered (2) 750 per person Not Covered (2) 1,050 4,200 20% Not Covered (2) 25% Not Covered (2) 20% 50% Includes deductible, coinsurance, medical and rx copay Includes Deductible, coinsurance, medical and rx copay Includes Deductible, coinsurance, medical and rx copay 6,350 Not Covered (2) 6,000 Not Covered (2) 4,500 Unlimited 12,700 Not Covered (2) 12,000 Not Covered (2) 9,000 Unlimited Hospital Services Inpatient Hospital 250 copay; then 20% Not Covered (2) 250 copay; then 25%* Not Covered (2) 250 copay; then 20% 300 copay; then 50%* Outpatient Hospital 20%* Not Covered (2) 25%* Not Covered (2) 20%* 50%* Emergency Room Urgent Care Routine Services Office Visit Specialist Visit Routine Physical/Wellness/Well Child Care 20%* 25%* 25%* 25%* 20%* 20%* 50 copay; then 20% Not Covered (2) 50 copay; then 25% Not Covered (2) 50 copay; then 20% 50 copay; then 50%* 45 copay Not Covered (2) 40 copay Not Covered (2) 30 copay 50%* 55 copay Not Covered (2) 50 copay Not Covered (2) 40 copay 50%* 0 copay Not Covered (2) 0 Not Covered (2) 0 copay Prescription Drugs Deductible None None None Tier 1 15 copay 15 copay Not Covered 15 copay Tier 2 Preferred Brand 20% copay (Minimum 25 - Maximum 80) Preferred Brand 20% copay (Minimum 25 - Maximum 80) Preferred Brand 20% copay (Minimum 25 - Maximum 80) Tier 3 Tier 4 (Specialty) Non-Preferred Brand 30% copay (Minimum 40 - Maximum 110) 20% copay (Minimum Maximum 150) Non-Preferred Brand 30% copay (Minimum 40 - Maximum 110) 20% copay (Minimum Maximum 150) Non-Preferred Brand 30% copay (Minimum 40 - Maximum 110) 20% copay (Minimum Maximum 150) Mail Order Mandatory Generic Tier 1 30 copay 30 Copay Not Covered 30 copay Tier 2 Preferred Brand 20% copay (Minimum 50 - Maximum 175) Preferred Brand 20% copay (Minimum 50 - Maximum 175) Preferred Brand 20% copay (Minimum 50 - Maximum 175) Tier 3 Non-Preferred Brand 30% Non-Preferred Brand 30% Non-Preferred Brand 30% Tier 4 N/A N/A N/A Value Bronze Value Silver Classic Silver Employee Only Employee + Spouse Employee + Child(ren) , Employee + Family * Deductible Applies 1, , , (1) Routine care covered 100% up to 300 per calendar year, then 10% (2) if outside the network. Inside AZ members to use Blue Cross network, outside AZ members to use Aetna network. (3) For family coverage, the entire family deductible must be met before any copay or coinsurance is applied any individual family member. 8

9 Plan Current Rates Renewal Rates % Change 2nd Pass % Change Rates Guaranteed to: MEDICAL - Meritain - Classic Silver Employee Not Grandfathered Employee + Spouse Employee + Children Employee + Family 1, MEDICAL - Meritain - Copay - Platinum Employee Not Grandfathered Employee + Spouse 1, Employee + Children 1, Employee + Family 1, MEDICAL - Meritain - Copay - Gold Employee Not Grandfathered Employee + Spouse 1, Employee + Children Employee + Family 1, MEDICAL - Meritain - HDHP 1,250 Plan Employee Not Grandfathered Employee + Spouse Employee + Children Employee + Family HEALTH SAVINGS ACCOUNT - HSA BANK (1) 2.25 DENTAL - Total Dental Administrators PPO Employee % % June 30, 2016 Employee + Spouse % % Employee + Children % % Employee + Family % % DENTAL - Total Dental Administrators A500S Employee % June 30, 2016 Employee + Spouse % Employee + Children % Employee + Family % VISION - Avesis Employee % June 30, 2017 (3) Employee + Spouse % Employee + Children % Employee + Family % LIFE w/ad&d - Hartford Life Life per AD&D per Total per VOLUNTARY LIFE - Hartford Life Age Rated VOLUNTARY SHORT TERM DISABILITY - Lincoln Financial Rate Per 10 of weekly benefit % June 30, 2016 (2) COBRA ADMINISTRATION - P&A Group Initial Notice Qualifying Event Annual Minimum Fee FLEXIBLE SPENDING ACCOUNT/CAFETERIA PLAN - P&A Group Fee per participant per month (includes Debit Card) % June 30, 2019 (4) Renewal Fee % ONLINE ENROLLMENT SYSTEM - BenefitsCONNECT Fees Waived June 30, 2016 Individual Supplemental Voluntary Policies - AFLAC (1) Fee paid by employee (waived for balances over 3,000). (2) 2nd year of a 2 year rate guarantee (3) 2nd year of a 3 year rate guarantee (4) 2nd year of 5 year rate guarantee Florence Unified School District #1 Rate Exhibit Renewal: July 1, 2015 No rate change, individual policies 9

10 Best and Final Offers COBRA Administration Basic Life & AD&D; Voluntary Life 10

11 COBRA Administration - Best and Final Offer Carrier Rates Current P&A Group Proposed P&A Group Proposed Best and Final Offer P&A Group First Year Cost Not Applicable Not Applicable Not Applicable Second Year Cost 1,700 1,700 1,700 % Change from Current Plan 0.0% 0.0% Rate Guarantee N/A 12 Months 60 Months 11

12 COBRA Administration - Best and Final Offer Current P&A Group Proposed P&A Group Proposed - Best and Final Offer P&A Group Vendor Name: Administration Fees: Initial set up fee: Not Applicable Not Applicable Not Applicable Renewal Year Set Up or configuration fees: Administration fee per: Employee per month COBRA participant per month Outline any fees charged to remit premium to insurance companies. Is this fee per month, a per "carrier", etc. None None None Fee For Service Items (Over and Above administrative fees): Annual Retainer which is spent down as notices are sent Annual Retainer which is spent down as notices are sent Annual Retainer which is spent down as notices are sent Initial COBRA Notice (Current Employees)@ N/A N/A N/A Initial COBRA Notice (New Hires)@ Qualifying Event Notice@ Takeover current COBRA participants@ N/A N/A N/A Estimated Annual Cost Annual First Year Not Applicable Not Applicable Not Applicable Annual Subsequent Years 1,700 1,700 1,700 Fee Guarantee: N/A 12 Months 60 Months Annual Assumptions Total Covered Employees 327 Initial COBRA Notice (New Hires) (1) 33 Qualifying Event Notice (1) 33 Current COBRA Participants 7 12

13 COBRA Administration Performance Guarantees - Best and Final Offer P&A Group Best and Final Offer - P&A Group Performance Standard Established Target Fees at Risk Established Target Fees at Risk Implementation P&A will guarantee the COBRA plan will be implemented in a timely manner, providing all required implementation paperwork is received 45 days in advance of the effective date of July 1, % P&A will guarantee the COBRA plan will be implemented in a timely manner, providing all required implementation paperwork is received 45 days in advance of the effective date of July 1, % Delivery of Contract/SPD A SPD is not applicable. COBRA Administration does not require an SPD. A contract (Service Agreement) will be available within 3-4 weeks providing all required implementation paperwork is received 45 days in advance of the effective date. 2.0% A SPD is not applicable. COBRA Administration does not require an SPD. A contract (Service Agreement) will be available within 3-4 weeks providing all required implementation paperwork is received 45 days in advance of the effective date. 2.0% Account Management P&A will provide a dedicated COBRA manager if awarded the contract. In the event that this individual is unavailable, their assistant, team leader or department supervisor will be available. P&A will return business phone calls in one business day. 2.0% P&A will provide a dedicated COBRA manager if awarded the contract. In the event that this individual is unavailable, their assistant, team leader or department supervisor will be available. P&A will return business phone calls in one business day. 2.0% Customer Service P&A guarantee that phone call abandonment rates will be less than 5%. In addition, P&A guarantees that 98% of customer service phone calls will be answered on an annual average rate of 30 seconds. 2.0% P&A guarantee that phone call abandonment rates will be less than 5%. In addition, P&A guarantees that 98% of customer service phone calls will be answered on an annual average rate of 30 seconds. 2.0% Reporting Total COBRA Fees at Risk Reports will be accurate and timely 98% of the time % 2.0% Reports will be accurate and timely 98% of the time % 2.0% 13

14 Basic Life and AD&D - Best and Final Offer Proposed Best and Final Carrier Current Hartford Proposed Symetra thru Arizona Benefit Plans Offer Symetra thru Arizona Benefit Plans Total Monthly Premium 2,139 1,688 1,688 Annual Premium 25,663 20,260 20,260 Percentage Change over -21.1% -21.1% current Rate Guarantee N/A 36 months 36 months 14

15 Basic Life AD&D Benefits & Rates - Best and Final Offer Company Name: Current Hartford Proposed Symetra thru Arizona Benefit Plans (1) Proposed - Best and Final Offer Symetra thru Arizona Benefit Plans (1) Life/AD&D Benefit 1 X Annual Salary; Maximum of 75,000 1 X Annual Salary, subject to a maximum of 75,000 rounded to the next higher 1,000 if not already a multiple of 1, X Annual Salary, subject to a maximum of 75,000 rounded to the next higher 1,000 if not already a multiple of 1,000. Age Reduction Schedule 35% at age 65, 50% at age 70, 70% at 35% at age 65; 50% at age 70; 70% at age 75; 35% at age 65; 50% at age 70; 70% at age 75; age 75, 80% at age 80 80% at age 80 80% at age 80 Portability Included Included Included Conversion Included Included Included Waiver of Premium Included Included Included Accelerated Death Benefit 80%; maximum 500,000 80%; maximum of 500,000 80%; maximum of 500,000 Verify you will provide experience reports with premium and claim information for life on at least a monthly basis. Your company agrees to permit annual open enrollment periods at which time evidence of insurability will not be required and that no preexisting condition limitations will apply to participants transferring between plans. Verify or specify alternatives. Monthly claims provided Annual enrollment period is "to be determined by the policyholder each year". Dates are flexible, employee elections must be made and signed off by the employee by 7/1 each year via an enrollment form Experience reports will be provided on annual basis. Symetra will provide traditional Enrollment Experience reports will be provided on annual basis. (Standard/ad hoc reports available 24/7 via our secure online portal) Symetra will provide traditional Enrollment It is assumed your company will credit time served N/A Confirmed Confirmed under the prior carrier toward the 2 year suicide exclusion. For example, if a carrier change happens and somebody had a year with carrier A, then they would only have one more year with the new carrier B to be eligible for the life insurance if a result of suicide. Verify Rates (per 1,000) Current Hartford Proposed Symetra Proposed Symetra Life AD&D Total Monthly Premium 2,139 1,688 1,688 Annual Premium 25,663 20,260 20,260 Rate Guarantee N/A 36 months 36 months Volume 28,139 15

16 Voluntary Life (NO AD&D) Rates - Best and Final Offer Company Current Hartford Rate per 10,000 Rate Per 5,000 Rate per 10,000 Rate Per 5,000 Rate per 10,000 Rate Per 5,000 AGE Employee Spouse Employee Spouse Employee Spouse UniSmoker UniSmoker UniSmoker Under Child(ren) AM Best Rating Rate Guarantee 0.94 per 10,000 A as of 4/3/2014 N/A per 1,000 Not Provided 36 months per 1,000 Not Provided 36 months Rate Examples -50,000 Age Age Age Rate Examples - 100,000 Age Age Age Rate Examples - 200,000 Age N/A N/A N/A Age N/A N/A N/A Age N/A N/A N/A (1) Basic life must be sold to have the voluntary life benefit Proposed Symetra thru Arizona Benefit Plans (1) Proposed - Best and Final Offer Symetra thru Arizona Benefit Plans (1) 16

17 Voluntary Life (NO AD&D) Benefits - Best and Final Offer Company: Current Hartford Proposed Symetra thru Arizona Benefit Plans Proposed - Best and Final Offer Symetra thru Arizona Benefit Plans Voluntary Life AD&D N/A N/A Employee Increments of 10,000 to maximum of 300,000 Increments of 10,000, subject to the lesser of 300,000 or 5 times Your annual Earnings. Increments of 10,000, subject to the lesser of 300,000 or 5 times Your annual Earnings. Spouse Increments of 5,000 to maximum of 150,000 Increments of 5,000, subject to a minimum of 5,000 Increments of 5,000, subject to a minimum of 5,000 and a maximum of 150,000. and a maximum of 150,000. Child(ren) Increments of 2,000 up to 10,000 Increments of 2,000 up to 10,000 Child(ren) birth - 6 months Increments of 2,000 to 10,000 Coverage will start at 14 days old. Coverage will start at 14 days old. Child(ren) 6 months - 26 years Increments of 2,000 to 10,000 Increments of 2,000 up to 10,000 Increments of 2,000 up to 10,000 Guarantee Issue Employee 80,000 80,000 80,000 Spouse 35,000 35,000 35,000 Child(ren) 10,000 10,000 10,000 Accelerated Death Benefit Amount 80% to maximum of 300,000 80% to maximum of 500,000 80% to maximum of 500,000 Waiver of Premium Included Included included included Reduction Schedule Will you grandfather all the current life/voluntary life insurance amounts? 35% at age 65; 50% at age 70; 70% at age 75; and 80% at age 80 35% at age 65; 50% at age 70; 70% at age 75; 80% at age 80 35% at age 65; 50% at age 70; 70% at age 75; 80% at age 80 N/A Confirmed Confirmed Verify you will provide experience reports with premium and claim information for voluntary life on at least a monthly basis. Provides on a monthly basis Experience reports will be provided on annual basis. Experience reports will be provided on annual basis. (Standard/ad hoc reports available 24/7 via our secure online portal) Your company agrees to permit annual open enrollment periods at which time evidence of insurability will not be required and that no pre-existing condition limitations will apply to participants. Verify or specify alternatives. Annual enrollment period is "to be determined by the policyholder each year". Dates are flexible, employee elections must be made and signed off by the employee by 7/1 each year via an enrollment form Traditional Enrollment will be provided Traditional Enrollment will be provided 17

18 Voluntary Life (NO AD&D) Benefits - Best and Final Offer Company: It is assumed your company will credit time served under the prior carrier toward the 2 year suicide exclusion. For example, if a carrier change happens and somebody had a year with carrier A, then they would only have one more year with the new carrier B to be eligible for the life insurance if a result of suicide. Verify. Current Proposed Proposed - Best and Final Offer Hartford Symetra thru Arizona Benefit Plans Symetra thru Arizona Benefit Plans N/A Confirmed Confirmed Participation Requirement Current number enrolled is 64% or 310 employees with 485 eligible 25% which is 122 employees of 485 eligible employees 25% which is 122 employees of 485 eligible employees Portability Included Included At what rate basis? (same or different Yes, different rates Yes but at different rate Yes but at different rate rates?) If master contract is terminated, will ported Yes Ported life policies will continue Ported life policies will continue life policies continue? Contingent for basic life award? N/A Confirmed Confirmed 18