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County Administrator's Report 9. 35.
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| BCC Regular Meeting |
Budget & Finance Consent |
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| RECOMMENDATION: |
Recommendation Concerning Group Medical Insurance - Jana Still, Human Resources Department Director
That the Board takes the following action concerning the County’s Group Medical Insurance:
A. Approve the employee and retiree health insurance premiums for the Plan Year 2021;
B. Authorize a deposit of $630 into the Health Saving Account (HSA) for employees who have elected this Plan. This will assist the employee in paying the higher deductible and the administrative fees;
C. Authorize the Health Care Opt-Out Program ($200 a month) to remain the same as Plan Year 2020 and eliminate the dental discount; and
D. Authorize changes for Plan Year 2021.
The cost of the County’s health claims is trending at $25,300,000. The first seven months of 2020 are running at 109.2% of the total budget. There are several factors driving the increase in claims costs, i.e. March through June, there were eighteen claimants that accounted for $1,1839,206 in claims which is 22.1% of the total claims cost; in July claims experience was extraordinarily high resulting in approximately $2.4M in claims for the month; and throughout the year, specialty drugs increased in cost by 66%.
[Funding Source: Fund 501, Internal Service Fund, Cost Center 150108, Object Codes 53401 and 54501] |
| BACKGROUND: |
Changes to the plans represent enhancements for the employee while also addressing the rising cost of health care. Additionally, adjustments to the Employee Health Clinic will integrate other providers and services (i.e. Florida Blue, EAP, Pharmacy) to improve the employee experience and promote preventive care as well as better overall wellness. Also, all plans retain a $50 discount for employees who do not use tobacco. An analysis by USI indicates that even with the suggested changes, the plans are still very rich and maintaining self-funded benefits is still the most advantageous option for the County.
The cost of the County’s health claims is trending at $25,300,000. The first seven months of 2020 are running at 109.2% of the total budget. There are several factors driving the increase in claims costs.
From March through June, there were eighteen claimants that accounted for $1,1839,206 in claims which is 22.1% of the total claims cost. July claims experience was extraordinarily high resulting in approximately $2.4M in claims for the month.
Per USI, the 2021 renewal projections range from +4.9% on the low end and +7.4% on the high end. Both the low and high projections are based on the “Severity Adjustment” that tempers the effect of the outlier claimants. The projections also include an increase in the pharmacy rebates from those paid in the 2020 plan year.
This does not include the staffing cost, the cost of the Clinic or any retirees that are on Medicare Plan F, Pharmacy, or Medicare Advantage. Medicare Advantage, Pharmacy and Medicare Plan F premiums will be determined later. Retirees will continue to be responsible for paying their full premium, whether they are Medicare-eligible or not.
For all Plans:
Teladoc – Teladoc services are being added to allow the employees to have access to a nurse/doctor 24/7 and offers the convenience and time saving of conducting the visits by phone rather than in person. Teladoc can also assist the employees in receiving services outside of the emergency room.
For both 3359 and 3559 Plans:
Emergency Room - Increase the co-pay for employees going to the emergency room from $200 + 20% co-insurance to $300 + 20% co-insurance. If a member is admitted into the hospital the co-pay for the ER is waived.
Members are encouraged to use the Escambia County Employee Health Clinic and Urgent Care facilities in the area in leu of visiting the ER. The cost for emergency room care is three times more than going to an Urgent Care facility. The County’s numbers are running on average a 100 visits per month to the ER. Per Florida Blue, approximately 32% of the ER visits could be seen at a primary doctor or Urgent Care. The increase in co-pay along with the added advantage of the Teladoc services should help mitigate some of these visits.
Deductible – increase by $250 per covered individual*
Out-of-Pocket Maximum – increase by $250 per covered individual*
Even with the increase to the deductibles and Out-of-Pocket maximum, the plans are comparable with regional standards.
*The maximum increase to a plan with 3 or more covered individuals will be $750.
For 3559 Plan Only:
Premiums – increase by 8%
One of the key indicators when evaluating the plans is the net claims per employee per month (PEPM) since 2015. The 3359 and HSA plans are between $816 to $952 which is within $136 of each other, while the 3559 spread has been increasing every year. In 2015, it was $300 more than the other plans and so far in 2020 the spread is over $472 more than the other plans. The 3559 Plan PEPM cost is running 81.8% more than the 3359 Plan. The adjustment to the premium will help align and support the value of the plan.
The County is continually looking at ways to reduce costs through plan design, stop loss measures, and any other available actions. The County in the next year will be actively looking at ways to reduce costs and still have a health plan that will be attractive to the employees.
The County will offer the existing plans and will provide individual supplement options during open enrollment for retirees that are Medicare-eligible. |
| BUDGETARY IMPACT: |
| Funds are available in Fund 501, Internal Service Fund, Cost Center 150108, Object Codes 53401 and 54501. |
| LEGAL CONSIDERATIONS/SIGN-OFF: |
| This is in accordance with Florida Statutes 112.09 and 112.0801. |
| PERSONNEL: |
| The Human Resources Department and all appointing authorities (payrolls) will have to make the appropriate adjustments to their payroll systems, Human Resources Information System, and work with Florida Blue to ensure changes are made in the respected systems. |
| POLICY/REQUIREMENT FOR BOARD ACTION: |
| N/A |
| IMPLEMENTATION/COORDINATION: |
| A Purchase Order will be the instrument utilized for making payment against the Contract. The Human Resources Department will coordinate with Legal, the Office of Purchasing, FRS, and the other appointing authorities to ensure all changes are made in the respected systems. |
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