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HomeMy WebLinkAboutAGENDA REPORT 1992 0219 CC REG ITEM 08GMOORPARK ITEM `5- C--1 799 Moorpark Avenue Moorpark, California 93021 TO: Honorable City Council FROM: Richard Hare, Deputy City Manag r DATE: February 14, 1992 SUBJECT: Consider Employee Health Insurance Plan Background (805) 528&= y�G s 99?— The current health insurance carrier for the City is Fortis, formerly Western Life. The policy period ended December 3st, however, Fortis would not renew for more than six months. The staff therefore, with the assistance of the City's commercial insurance broker, Tolman & Wiker, requested proposals from several insurance carriers and the Southern California Joint Powers Insurance Authority (SCJPIA). The carriers were asked to match the current benefit plan provided by Western Life (Fortis), to provide a twelve month contract for coverage, and to provide their preferred provider listing. Proposals were initially received by Tolman & Wiler and were then reviewed with staff. The SCJPIA plan, although superior in wellness benefits, d=d not have an adequate preferred provider list in Ventura County. This eliminated their plan when the Council selected Western Li=e in 1990. The SCJPIA indicates that they do not anticipate increasing the number of preferred providers in this area until more cities from this area join the Authority. United Insurance Company of America provided the only proposal which substantially matched or exceeded the benefits of Western Life (Fortis). Additionally, United has a preferred provider agreement with the Ventura Foundation for Medical Care which is the largest health care preferred provider organization (PPO) in Ventura County and is associated with similar organizations in Los Angeles County and Santa Barbara County. The City formerly participated in this PPO prior to contracting with Western_ Life for health coverage. A meeting was held with employees to discuss the possible renewal with Western Life (Fortis) for another six months at the higher premium or the change to United with the Ventura Foundaticz PPO for a lower premium. Typically there is resistance to changing health insurance companies because of the inconvenience involved for the employees. In this case, the Ventura Foundation FPO is PAUL V, LAWRASON JR. JOHN E. WOZNIAK SCOTT MONTGOMERY BERNARDO M. PE ?EZ RO` E. TALLEY JR. Mavor Mayor Pro Tem Councilmember Councilmemt- C-auncimember Honorable City Council Employee Health Insurance Plan February 13, 1992 Page Two superior and includes most of the doctors our employees already use, as well as all of the Ventura County hospitals. The overwhelming feedback from employees was that they supported the change. If the City Council authorizes the change to United, it would take effect March 1, 1992, for a twelve month policy period. A comparison of the two companies is attached. Two key issues, not included on the comparison, are the premiums and the term of the contract. The term of the United policy would be twelve months compared to only six months for the Western (Fortis) policy. The employee premium would be $182 for United and $206 for Western (Fortis). The additional premium for family coverage would be $286 for United and $311 for Western (Fortis). The combined coverage is $468 for United and $517 for Western (Fortis). The previous Western (Fortis) premium established July 1, 1991, -- was $182.10 for employee only, $286.26 for dependents, or $468.36 for a combined rate. The new Western (Fortis) rates represent a 13% increase in employee rate, a 9% increase in dependent rate, and a 10% increase in combined premium. The United rate is essentially the same as the Western (Fortis) July 1, 1991 rate. Recommendation Staff recommends transferring health insurance coverage to United Insurance Company of America and asks the Council to direct the City Manager to implement the agreement for coverage, effective March 1, 1992. Attachment: Coverage Comparison COVERAGE COMPARISON for THE CITY OF MOORPARK UNITED INSURANCE WESTERN LIFE COMPANY OF AMERICA FORTIS BENEFITS Provider Network Ventura Co. Foundation for Medical Care Western Care Lifetime Maximum Benefit $2,000,000 $1,000,000 Out of Pocket Maximum $1,150 $1,250 Assuming preferred Inclusive of providers and hospitals deductible. are used. Deductible $250 i $250 Waived for services Waived for services received by preferred received b y preferred providers. providers. Hospital Co -Pay $150 $250 Paid at 908, Deductible Paid at 1008 for waived for preferred hospital preferred hospital Physicians Services $10 Co- Payment Paid at 1008 - office $10 Co- Payment Paid at. 908 - hospital Paid at 100% - office Paid at 80% - hospital patient Surgery Paid at 908 Deductible waived for Paid at 100$ preferred provider Deductible waived for preferred provider Diagnostic X -Ray and Paid at 908 Laboratory services Deductible waived for Paid at 808 preferred provider Deductible applies Birthing Centers Paid at 1008 Deductible waived for Paid at 808 preferred provider Deductible applies Prescription Drugs Generic: $5 Generic: $5 Brand Name: $5 + 308 Brand Name: $7 Mental and Nervous Paid at 908 Disorder (inpatient) $25,000 Lifetime Max. Paid at 50$ $5,000 Calendar year Max. $20,000 $ 10,000 Calendar Deductible waived for year Maximum. preferred provider Substance Abuse Paid at 90% $2,000 Lifetime Max. Paid at 808 (Maximum combined with Inpatient max. of 30 days. mental and nervous) Outpatient max. Of $500 per year. Well Child Care Paid at 1008 Not Covered To age 6.