Loading...
Minutes April 4, 2005 CITY OF DENTON CITY COUNCIL MINUTES April 4, 2005 After determining that a quorum was present, the City Council convened in a Special Called Meeting on Monday, April 4, 2005 at 11 :30 a.m. in the Council Work: Session Room. PRESENT: Mayor Brock:; Mayor Pro Tem McNeill; Council Members Mulroy and Thomson. AB SENT: Council Members Kamp, Montgomery and Redmon 1. The Council received a report, held a discussion and gave staff direction regarding the City of Denton's employee health benefits program. City Manager Conduff stated that the goal was to have the city's portion of the health insurance increase no more than 3% annually. In order to accomplish that, plan adjustments and premium adjustments for employees would have to be made. Scott Payne, Risk: Manager, presented the recommendations for the plan design for next year. Those recommendations were a blend of the recommendations from the Employee Insurance Committee and the variables presented in Option 2. It met the budget target of limiting the city's total increase for health coverage to 3% assuming a 25% or less rate increase in 2006. The recommendations were as follows: . Align the health plan year with the City's fiscal year beginning October 1, 2006 to give two full years of claims data with United Health Care and to allow sufficient time to align other employee benefits such as dental, vision, and life. . Move to the Open Access Plus Medical Provider Network: within United Health Care with an estimated 3% savings. . Add a $500 per person/$1 000 per family deductible. Currently there was no deductible for in-network: charges for an estimated 6% savings. . Change the co-insurance to 90% in network: and 70% out of network: for an estimated 3% . savIngs. . Add $1000 per person/$2000 per family for an out-of-pock:et maximum for an estimated 3.5% savings. . Increase the physician office visit from $15 to $20 per visit for an estimated .5% savings. . Change prescription drug copay to $10 generic, $30 formulary and $50 for name brand for a 2% savings . Funding increases - increase all levels by $35 per month Payne indicated that the above changes would result in an estimated total savings of 22.5%. He then reviewed an impact on employees plus a benefits comparison with other cities. City of Denton City Council Minutes April 4, 2005 Page 2 Council discussion included: . Were the deductibles and copay included in the $2000 out-of-pock:et family expense - no, the $500 deductible had to be met first, and then the cost share at 90/10 would begin. The 10% would accumulate towards the out-of-pock:et maximum. The copay was always paid but not applied to the deductible. . Was a deductible on prescriptions considered - that was not recommended at this time. . What did the consultant do for city for health insurance - the firm assisted with the determination of renewal rates and work:ed with underwriters to lower renewal rates before going out for a new bid. Council consensus was to go out for a new bid before renewing the consultant contract. . The City was spending $10.5 million on health benefits and the proposed pack:age rearranged benefits to k:eep a 3 % increase for the City to absorb into the budget that would be an annual goal. That will require additional alternatives in the future to k:eep those costs down. How did the Employee Insurance Committee work: on this proposal and how would the Committee move forward. Payne responded that representatives from various departments made up the Employee Insurance Committee. The EIC had talk:ed with departments on the changes that would have to be done. . Was ample dialog done with employees through the Committee - some groups probably didn't get the message but about 90% of the employees had been notified. . City Manager Conduff stated that some of the recommendations were different than what the Committee had recommended. The cost of retiree health care would also increase by $35. The retirees would get the full cost of the increase but also have $35 back:ed out of their benefits. . What about employees who retired and were not eligible for Medicare - they could tak:e city insurance and would be charged the retired rate. If an employee were 65 and still work:ing at the City the city insurance would be primary and Medicare would be secondary. Retirees were currently charged $343 for health insurance that was subsidized $100 per month. . The city was not currently self-insured - correct; the City was fully insured through United Health Care. A down side of self-insurance was that if the stop loss coverage were not high enough the plan would be hurt. . A suggestion was to look: at self-insurance as a long-term goal plus joining with other organizations for a larger pool of participants. Consensus of the Council was to proceed with recommendations, k:eeping the EIC involved and provide Council with updates every three months. City of Denton City Council Minutes April 4, 2005 Page 3 2. The Council received a report, held a discussion and gave staff direction regarding the FY 2005-06 drainage operating budget and CIP. Howard Martin, Assistant City Manager, stated that Council had directed staff to evaluate the financial impact to the drainage budget and future CIP if the general fund did not pay drainage fees and the drainage division did not pay franchise fee and return on investment. The revenue increase in combination with projected capital funding would produce approximately $880,000 in average annual funding for capital improvements totaling an estimated $11.5 million over the next 13 years. This would also result in a net revenue increase of approximately $3.3 million over the next 13 years to the drainage CIP. At this time, staff was moving forward with the elimination of franchise fee, return on investment and drainage fee payments in the long -range financial forecast scheduled for an upcoming council review. Consensus of the Council was to proceed as proposed with more discussion to tak:e place in the upcoming financial forecast meeting. With no further business, the meeting was adjourned at 12:30 p.m. EULINE BROCK MAYOR CITY OF DENTON, TEXAS JENNIFER W ALTERS CITY SECRETARY CITY OF DENTON, TEXAS