HomeMy WebLinkAboutAgenda - 10-02-2012 - 7a 1
ORANGE COUNTY
BOARD OF COMMISSIONERS
ACTION AGENDA ITEM ABSTRACT
Meeting Date: October 2, 2012
Action Agenda
Item No. 7-a
SUBJECT: Employee Health Insurance and Other Benefits for 2013
DEPARTMENT: Human Resources PUBLIC HEARING: (Y/N) No
ATTACHMENT(S): INFORMATION CONTACT:
A. 2013 Renewal Option Costs Detail for Nicole Clark, Human Resources
Active Employees and Pre-65 Retirees Director, (919) 245-2552
B. Comparison of Plan Designs Diane Shepherd, Benefits Manager,
C. Responses to Questions Raised at the (919) 245-2558
9/11/12 BOCC Work Session John Roberts, County Attorney, (919)
245-2318
PURPOSE: To consider the County Manager's recommendations for employee health
insurance and other benefits for the 2013 calendar year.
BACKGROUND: The County provides employees with a comprehensive benefits plan
including County-paid health, dental and life insurance, an employee assistance program,
flexible compensation plan and paid leave for permanent employees. Additionally, the County
contributes to the Local Governmental Employees' Retirement System and a supplemental
retirement plan for each permanent employee.
Staff provided information relating to FY 2012-13 employee benefits at work sessions on June 7,
2012 and September 11, 2012, and in the County Manager's recommended budget for FY
2012-13. The FY 2012-13 Approved Budget includes funds for up to a 23.0% health insurance
premium increase effective January 1, 2013.
2013 Benefit Plans
The following employee benefits are recommended for implementation for the 2013 calendar
year:
Health Care
UnitedHealthcare has provided options for the 2013 employee health insurance benefits,
including renewal of the existing 2012 plan and with enhancements. Premiums for the renewal
and two enhancement options are shown on Attachment A. Attachment B provides details of
the renewal and enhancement options. Attachment C captures questions and comments raised
by the Board of County Commissioners during the September 11, 2012 Work Session and staff
responses.
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FINANCIAL IMPACT: Attachment A includes the estimated costs of the health insurance
options.
RECOMMENDATION(S): The Manager recommends the Board:
• Approve the renewal of the fully-insured health insurance plans with UnitedHealthcare,
choosing one of the following options:
o Option 1, with an overall premium increase of 8.51%, or
o Option 2, with an overall premium increase of 13.14%.
Current and Renewal Costs Detail for Active Employees 3
and Pre-65 Retirees Attachment A
Fully-Insured Options Effective January 1,2013
Monthly Costs Calendar Year Costs
Individual 464 $579 $579 $0 $3,221,589 $3,221,589 $0
POS(Point of Ind/Children 163 $937 $732 $205 $1,833,398 $1,431,569 $401,829
Service) Ind/Spouse 72 $1,221 $853 $368 $1,054,797 $737,027 $317,770
Family 49 $1,736 $1,073 $663 $1,020,633 $630,983 $389,650
Total 748 $7,130,417 $6,021,168 $1,109,249
Current Plans Individual 104 $579 $579 $0 $722,080 $722,080 $0
Ind/Children 45 $873 $732 $142 $471,631 $395,218 $76,412
High Deductible Ind/Spouse 18 $1,106 $853 $253 $238,978 $184,257 $54,721
Plan* Family 29 $1,530 $1,073 $456 $532,290 $373,439 $158,852
Total 196 $1,964,979 $1,674,994 $289,985
Renewal Totals $9,095,396 $7,696,162 $1,399,234
Individual 464 $621 $621 $0 $3,456,447 $3,456,447 $0
POS(Point of Ind/Children 163 $1,006 $778 $228 $1,967,051 $1,521,222 $445,830
Service) Ind/Spouse 72 $1,310 $908 $402 $1,131,693 $784,257 $347,436
Family 49 $1,862 $1,144 $719 $1,095,038 $672,558 $422,480
Total 748 $7,650,230 $6,434,484 $1,215,746
United Health Individual 104 $613 $613 $0 $765,336 $765,336 $0
Care Renewal Ind/Children 45 $930 $778 $152 $501,952 $419,969 $81,982
High Deductible Ind/Spouse 18 $1,180 $908 $272 $254,774 $196,064 $58,710
Plan* Family 29 $1,634 $1,144 $490 $568,475 $398,044 $170,431
Total 196 $2,090,537 $1,779,414 $311,123
Renewal Totals $9,740,767 $8,213,899 $1,526,869
Individual 464 $631 $631 $0 $3,514,410 $3,514,410 $0
POS(Point of Ind/Children 163 $1,023 $778 $245 $2,000,049 $1,521,222 $478,827
Service) Ind/Spouse 72 $1,332 $908 $424 $1,150,675 $784,257 $366,418
United Health Family 49 $1,894 $1,144 $750 $1,113,402 $672,558 $440,844
Total 748 $7,778,536 $6,492,447 $1,286,089
Care Option 1 Individual 104 $613 $613 $0 $765,336 $765,336 $0
with Enhance-
Ind/Children 45 $930 $778 $152 $501,952 $419,969 $81,982
ments High Deductible Ind/Spouse 18 $1,180 $908 $272 $254,774 $196,064 $58,710
Plan* Family 29 $1,634 $1,144 $490 $568,475 $398,044 $170,431
Total 196 $2,090,537 $1,779,414 $311,123
Option 1 Totals $9,869,073 $8,271,861 $1,597,212
Individual 464 $659 $659 $0 $3,668,254 $3,668,254 $0
POS(Point of Ind/Children 163 $1,067 $807 $260 $2,087,600 $1,579,303 $508,297
Service) Ind/Spouse 72 $1,390 $943 $447 $1,201,038 $814,855 $386,183
United Health Family 49 $1,976 $1,190 $787 $1,162,141 $699,487 $462,654
Care Option 2 Total 748 $8,119,032 $6,761,898 $1,357,134
with Enhance- Individual 104 $636 $636 $0 $793,354 $793,354 $0
ments and Ind/Children 45 $966 $807 $159 $521,597 $436,004 $85,593
Obesity High Deductible Ind/Spouse 18 $1,227 $943 $284 $265,008 $203,714 $61,295
Plan* Family 29 $1,701 $1,190 $511 $591,913 $413,982 $177,931
Total 196 $2,171,872 $1,847,053 $324,819
Option 2 Totals $10,290,904 $8,608,952 $1,681,953
*All High Deductible Plans include an annual County contribution to a Health Savings Account of$1,237.20. $103.10 per month
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Attachment B
Comparison of Plan Designs
2013 Orange County Health Insurance Renewal and Options
High Deductible Plan POS POS POS
In-Network Service g
(Out of Network Services with Health Savings
available, but not shown) Account
Renewal and Options 1 Renewal Option 1 Option 2
and 2 (107.10%)* (108.51%)* (113.14%)*
$20, includes $20, includes
Primary Care Physician minor surgery and minor surgery and
Visits 80% after Deductible $20 lab work lab work
Specialist Physician
Visits 80% after Ded. $40 $40 $40
Preventive Care 100% 100% 100% 100%
Individual Deductible $1,500 $500 $500 $500
Deductible - Family
Maximum $3,000 $1,500 $1,500 $1,500
Coinsurance Limit -
Individual $2,000 $1,000 $1,000 $1,000
Coinsurance Limit -
Family Max $2,000 $3,000 $3,000 $3,000
Maximum Out of Pocket
(Deductible + $3,500 Individual/ $1,500 Individual/ $1,500 Individual/ $1,500 Individual/
Coinsurance) $5,000 family $4,500 family $4,500 family $4,500 family
In-patient and Outpatient
Hospital Services 80% after Ded. 80% after Ded. 80% after Ded. 80% after Ded.
Emergency Room 80% after Ded. $150 $150 $150
Pharmacy 80% after Ded. $8/$25/$45 $41$25/$45 $41$25/$45
Generic Prescriptions 80% after Ded. $8/$25/$45 $4 $4
County Contribution to
Health Savings Account $1,237.20 Not available Not available Not available
Available with Option 2
Obesity Surgery only Not available Not available Available
*Total premium increase percentage that includes the High Deductible Plan and POS straight
renewal, Option 1 and Option 2
Option 1
Same benefits as the renewal, with enhancements to the Point of Service Plan:
• Simple labs (e.g., throat cultures) included with In-Network office co-pay (covered at 100%)
• Minor in-office surgery (e.g., mole removals) included with In-Network office co-pays (covered
at 100%)
• Pharmacy co-pays of$4/$25/$45, and all generics placed in Tier 1 (some brand name
prescriptions remain in Tier 1)
Option 2
Same benefits as Option 1, with the addition of certain morbid obesity treatment (e.g., gastric bypass,
gastric banding) to both Point of Service and High Deductible Plan.
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' Attachment C
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Orange County Human Resources Department
200 South Cameron Street Nicole M. Clark, SPHR, IPMA-CP Tel (919) 245-2550
Post Office Box 8181 Director Fax (919) 644-3009
Hillsborough, NC 27278 www.orangecountync.gov
MEMORANDUM
To: Frank W. Clifton, County Manager
From: Nicole M. Clark, Human Resources Director
Date: September 21, 2012
Subject: Responses to Questions from the September 11, 2012 Work Session
At the September 11, 2012 Work Session, there were several questions raised by the Commissioners
with regards to employee benefits. Listed below are the questions and responses:
1. Question: Commissioner Jacobs asked if we could ask employees whether or not they
would be willing to accept fewer benefits if they could switch to a provider they would
rather have.
Response: This question will be asked during a series of upcoming focus groups.
2. Comment: In light of the recent changes to eligibility requirements for retiree health
insurance for employees hired on or after July 1, 2012, Commissioner Foushee stated that
the Commissioners should have comparable requirements for equity's sake.
Response: County Attorney John Roberts researched the legislation and found that Orange
County grants commissioners benefits after 8 years of service to the county. In 2009, the
General Assembly passed a law that authorizes counties to grant commissioners benefits
after a minimum of 10 years of service. This 2009 law pre-empts the County's policy and
applies to all commissioners elected after 2009.
3. Question: Commissioner Jacobs clarified that the renewal increase was less than budgeted
and asked if the excess could be applied to employee wellness.
Response: Any excess reverts to the unassigned fund balance. Employee wellness will be a
topic during the series of upcoming focus groups.
4. Question: Commissioner Yuhasz asked if there was anything the County could do to make
sure employees get better service from UnitedHealthcare.
Response: Employees can continue to voice their concerns to Human Resources and those
concerns will be shared with UnitedHealthcare during quarterly meetings. UnitedHealthcare
will also attend at least one focus group to discuss customer service.
An Equal Opportunity/Affirmative Action Employer
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5. Question: Commissioner Hemminger asked to allow a gap in the continuous service
eligibility for retiree health insurance for employees who have to take an extended amount of
time off.
Response: Employees on extended leave (paid or unpaid) are still considered employees
with no interruption in service in the Local Government Employee's Retirement System.
CC: Clarence G. Grier, Assistant County Manager, CFO
John Roberts, County Attorney
Diane Shepherd, Benefits Manager