Title
AN ORDINANCE CREATING A SPECIAL MEDICAL SELF-INSURANCE FUND 605; AND DECLARING AN EMERGENCY.
Executive Summary: This ordinance is to establish a new fund and appropriations to account for the financial activity of the newly established health reimbursement account (HRA) for City employees. The revenue in the fund will come from charges to other operating funds and the expenses will consist of medical claim payments for employee deductibles. The City is using a third party administrator (Health Equity, Inc.) for the payment of the claims.
Body
Legislative History
Resolution 12-146 authorized the renewal contract with SummaCare for employee health care.
Purpose & Explanation
The renewal with SummaCare included the implementation of a $2,000/$4,000 deductible and $2,000/$4,000 out of pocket maximum. As part of the renewal, Council agreed to fund the employee deductibles. This change (along with increased employee premium contributions) allowed for a modest 1.92% increase in healthcare for 2013.
We will fully fund the account for the first year based on the maximum exposure. The expectation is that we will not expend the maximum and will be able to offset future health care renewal increases with the savings. Keeping a separate fund will allow us to quickly determine the savings and available balance.
Timing Considerations
We request passage of the ordinance as soon as possible and include emergency language since we have already implemented the new health care program.
Fiscal Impact
Currently Budgeted
X Supplemental Appropriation Required for $470,000
Appropriation Not Required.
Suggested Action
Recommendation
Staff recommends passage of the ordinance with emergency language
Submitted by,
Jeff Knoblauch, Finance Director