HomeMy WebLinkAboutReso 2008-1243
RESOLUTION NO. 2008-~
A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF
SUNNY ISLES BEACH, FLORIDA, APPROVING THE
SELECTION OF UNITED HEALTH CARE AS THE CITY'S
HEAL TH CARE PROVIDER, SUN LIFE AS THE CITY'S DENTAL
INSURANCE PROVIDER, AND NEIGHBORHOOD HEAL TH
PLAN AS AN AL TERNA TE HEALTH CARE PROVIDER FOR A
ONE-YEAR PERIOD; AUTHORIZING THE CITY MANAGER TO
ENTER INTO AGREEMENTS WITH THESE PROVIDERS,
PROVIDED SAID AGREEMENTS ARE APPROVED AS TO
FORM AND LEGAL SUFFICIENCY BY THE CITY ATTORNEY;
FURTHER AUTHORIZING THE CITY MANAGER TO DO ALL
THINGS NECESSARY TO EFFECTUATE THIS RESOLUTION;
PROVIDING FOR AN EFFECTIVE DATE.
WHEREAS, the City of Sunny Isles Beach currently provides regular full-time and part-
time employees with primary health care through United Health Care, a full-service healthcare
provider; and
WHEREAS, the City's health and dental insurance review team met with the City's
insurance broker (Brown & Brown Insurance, Inc.) in mid-January to review the initial insurance
renewal information received from the City's current health and dental insurance providers; and
WHEREAS, there was a significant increase in rates for said insurances, a total of twelve
providers were canvassed for both health and dental insurances; and
WHEREAS, selection parameters established for the insurance review included (I)
provide the same level of benefits in both health and dental (and for health that it be a national
provider), (2) a renewal increase that is under the given industry standard renewal increase, and
(3) have minimal impact on employees; and
WHEREAS, the insurance review committee and Brown & Brown recommend United
Health Care (UHC) as the City's health insurance provider, at the same level of benefits (HMO
and "pay-up" pas plan) and an 11 % rate increase (under industry standard); and
WHEREAS, additionally, the insurance review committee and Brown & Brown
recommend the City offer the lower cost Neighborhood Health Plan (a non-national, local
subsidiary of UHC) as a voluntary option, in an effort to provide a more affordable Family Plan
option for employees; and
WHEREAS, the insurance review committee and Brown & Brown recommend Sun Life
as the City's dental insurance provider, which provides for the same level of benefits and a
comparable provider network as the current provider and a total one-year cost savings to the City
of approximately $9,700; and
WHEREAS, the renewal date for the City's health and dental insurances is April 1, 2008.
R2008- United Health Care For Group Insurance Coverage Page I 01'2
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE
CITY OF SUNNY ISLES BEACH, FLORIDA, AS FOLLOWS:
Section 1. Approval of City Commission. The City Commission hereby approves the use of
United Health Care as the City's health care provider, Sun Life as the City's dental insurance
provider, and Neighborhood Health Plan as an alternate health care provider for a one-year
period, with a renewal date of April 1, 2008.
Section 2. Authorization of City Manager. The City Manager is hereby authorized to enter
into agreements with said insurance providers, provided said agreements are approved as to form
and legal sufficiency by the City Attorney.
Section 3. Further Authorization of the City Manager. The City Manager IS hereby
authorized to do all other things necessary to effectuate this Resolution.
Section 3.
Effective Date. This Resolution shall become effective upon adoption.
PASSED and ADOPTED on this 20th day of March 2008.
ATTEST:
~'A~
Jane A. Hines, CMC, City Clerk
APPROVED AS TO FORM AND
LEGAL S FFICIENCY
Moved by: V Ic::.a... v'Y\~'()v ~~~
Seconded by: ~w\"~..rt\..Ooo'\ ~ R.~ :Z....l 10
Vote: S-t>
Mayor Norman S. Edelcup
Vice Mayor Lewis Thaler
Commissioner Roslyn Brezin
Commissioner Gerry Goodman
Commissioner George "Bud" Scholl
VYes)
v (Yes)
~Y es)
~(Yes)
~Yes)
_(No)
_(No)
_(No)
_(No)
_(No)
R2008- United Health Care For Group Insurance Coverage Page 2 01'2
I
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Brown
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Brown & Brown of Florida, Inc.
Spe"ard I lolland Bldg. Suite <100
8000 Govemor, Square Blvd.
Miami La kl's, fL 330 Hi-15!!!!
30'i/:l64.7800' Toll free 800/4.12.88.14
FAX 303/R22.56S7
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February 8, 2008
City of Sunny Isles Beach
18070 Collins Avenue
Sunny Isles Beach, Florida 33160
Attn: Tom Acquaro
Re: Benefit Insurance Program
Dear Tom,
The City of Sunny Isles Beach Medical and Dental policies are due for renewal on March 1, 2008. As you
know, the medical market trend for increases are coming in between 12.5% to 14% annually and dental is
10%. This is based on the rising cost of medical services, dental services, prescription drugs and healthcare
administration. Our office has approached the marketplace for both lines of coverage and with diligent
effort, have been able to secure renewals below the annual trend on all policies.
It is our intention to offer a benefit program, based on the City's direction, that does not reduce benefits nor
take away the National Network Capability that some employees utilize as they live outside of the Tri-County
area and, most importantly, one that offers as little disruption to employees as possible. It is our general
practice to approach multiple carriers in the marketplace to ensure that we are able to offer the best product
that suits our client's needs with the most competitive pricing.
Health Insurance
The initial United Healthcare (UHC) renewal quotation was received on January 9, 2008. At that time based
on claims history the manual rates were calling for a 33% increase, but UHC offered a 19% increase. We
approached Aetna, AvMed, BCBS, Cigna, Humana and alternates with the UHC company Neighborhood
Health Partnership (NHP).
All carriers provided proposals with the exception of AvMed who declined due to not being able to provide
competitive rates. Competitive data from Humana and Aetna was forwarded to the underwriters at United.
United responded with an 11 % increase and additional options with United Healthcare which would allow
the group to keep the National Network and potentially reduce the renewal rate to as low as 9.8% with slight
plan changes. This was after requesting that the RX be modified under the UHC 7DA plan to mirror the
current plan's RX. The rate relief given was also passed onto the associated NHP plans. Two NHP plans
were provided offering a reduction below the current rates. Although this plan is not national, it is able to
partner with a UHC program and allow the employee to make a voluntary decision to take the NHP plan
versus the offered UHC plan. The NHP plan is a local plan (Miami-Dade, Broward, and Palm Beach
counties) which has a lower out-of-pocket premium for employees with families as compared to the offered
UHC HMO plan. Employees would have the option to select the NHP plan which is still a rich HMO plan and
realize a large cost savings for those insuring their families. It allows someone whom might previously have
declined coverage for the family due to pricing to now afford it and have the protection.
The Humana plans mirror the current United plans in benefits but do not have the same strength in Network.
The Humana HMO is a local HMO with coverage only in Dade, Broward and Palm Beach County and also
does not include a few Doctors that a large portion of the employees utilize. Although the cost was
significantly less than the renewal offered with the same copay levels under United, the employee would
stand to lose more in National Network capability, authorization ease for major diagnostic testing amount of
physicians available. The Aetna plans were also similar in structure but do not have the same Network
capabilities as United and the City has some concerns with past experience of claim and RX issues. Cigna
and Blue Cross Blue Shield of Florida both also offered plans with reduced benefits and higher premiums
than the current plan. Multiple options were given to the client and two meetings were held with myself and
Samantha Alvarez from my office and CSIB employees, Tom Acquaro, Yael Londono and Douglas Haag.
,---
Page 2
February 8, 2008
City of Sunny Isles Beach
Dental Insurance
The Dental plan renewal option with Guardian Life initially offered was at an 11 % increase. The dental went
to market on the same day as the medical to Principal, Mutual of Omaha, Cigna, Aetna, Humana, BCBS,
Sun Life and Lincoln Financial. We sent competitive data to Guardian and were able to negotiate a 5%
reduction resulting in a 6% renewal increased rate. Sun Life and Principal are both below the final renewal
rate offer, mirroring the current contract with a two year rate guarantee. However, the Sun Life dental
program offers a very rich contract (same level of benefits as Guardian) and offers a larger dental provider
network than that of Guardian and also will provide an estimated savings of $9700 annually for the City.
Recommendation
It is our recommendation to keep the current United HMO plan and POS plan with the 11 % increase which is
still below the industry standard increase and pair that with the NHP program. This again is allowing the
employees the opportunity to have the choice of a greater cost savings or stay with UHC's National Network
and the same level of benefits as is currently offered.
We also recommend that the CSIB changes dental plans to Sun Life. This will allow a large monetary
savings on both the City and the Employees part. It also will give the City the opportunity to move the
following year (CY 2009), if they should choose, to Lincoln Financial Group (LFG) to gain the benefit of a
package savings and 24 month rate guarantee as LFG currently provides the City with all of their additional
ancillary products such as Long Term Disability insurance and Accidental Death and Disability insurance.
These savings are greater than on a stand alone carrier basis. Due to contractual issues we can not offer
the LFG dental plan this calendar year.
We appreciate the opportunity to continue to service your insurance needs.
Please feel free to contact our office with any questions.
Sincerely,
Brown & Brown of Florida, Inc.
l/t.7d /{C
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Executive Vice President
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CITY OF SUNNY ISLES BEACH, FLORIDA
2008 Employee Benefit Plan
Review & Recommendations
Prepared by
Siver Insurance Consultants
Februmy 13, 2008
2008 Employee Benefit Plan
Review and Recommendations
February 13,2008
EXECUTIVE SUMMARY
The City of Sunny Isles Beach, Florida (the City) employee benefit plans renew on
March 1, 2008. Siver Insurance Consultants (Siver) was requested to review the medical
and dental renewal options presented.
Based upon our discussions with City staff, the City's goals for the 2008 renewal include:
· Control cost increases for the City;
· Provide the same benefits to employees, retirees and their families;
· Have minimal impact financially on employees, retirees and their families; and
· Have minimal impact on medical provider choice for employees, retirees and their
families.
Based upon our review of the renewal proposals and these goals, we recommend:
· Renew the current HMO and POS medical plans with United Healthcare with no
changes in plan design and also add a third lower cost option, Neighborhood
Health Plan, for employees and their families; and
· Change dental insurance providers to SunLife.
The medical plan increase is 11.2% which, in our opinion, is comparable to increases
being experienced by other similar employers in Florida. Towers Perrin and
PricewaterhouseCoopers LLP are reporting increases in health insurance premiums for
HMOs in late 2007 and early 2008 to be between 8 and 10%, While the City's increase
is slightly higher than these averages, the averages include data from many employers
who reduced benefits to control cost increases and the City's premiums do not reflect this
type of reduction.
The change in dental insurers generates a decrease in premiums for the dental coverage.
Page 2
2008 Employee Benefit Plan
Review and Recommendations
February 13,2008
MEDICAL PLAN
OPTIONS PROPOSED
Brown & Brown is the City's insurance broker for both medical and dental insurance. In
preparation for this renewal, Brown & Brown requested medical renewal proposals from
the following insurers in addition to United Healthcare:
. Aetna
. A vMed
. Blue Cross Blue Shield Florida
. CIGNA
. Humana
A vMed and Blue Cross Blue Shield Florida did not provide proposals to Brown & Brown
within the requested timeframe. The proposals from CIGNA were higher priced than the
comparable United Healthcare plan. Aetna provided a proposal for both the HMO and
POS options, however, the cost savings for the HMO is about 6.8% compared to the
United Healthcare renewal proposal. It is understood from discussions with City staff
that Aetna was the previous City's insurer prior to United Healthcare and the City
experienced service problems, particularly regarding prescription and claim issues.
The H umana proposal is competitively priced with a cost savings of about 16.6%
compared to the United Healthcare renewal proposal, however, it includes the following
benefit reductions:
. Prescription plan differences - The proposed Humana prescnptlon plan
includes a fourth tier which applies to injectable specialty drugs. The plan
member is responsible for 25% of the cost, with no maximum, for these
specialty drugs. Under the current and proposed United Healthcare plan,
these drugs are covered with a $40 copayment. Some examples of the drugs
which would be subject to the increased copayment are growth hormones,
treatment for hemophilia and some chemotherapy drugs.
In a typical year, this increased cost to members will affect only a few
employee families, however, the affect could be significantly costly. For
example, we recently saw an example of a growth hormone drug which was
about $16,848 per month. In this example, the City employee would be
responsible for over $4,212 per month.
· Lifetime maximum - The proposed Humana HMO plan includes a lifetime
maximum of $5,000,000. The current United Healthcare HMO plan does not
have a lifetime maximum, the benefits are unlimited, While we would not
expect this benefit difference to have a significant effeet on any employees, it
Page 3
1--
2008 Employee Benefit Plan
Review and Recommendations
February 13,2008
is both a decrease in potential coverage and could be a significant difference
in benefit for employees who experience some sort of catastrophic health
situation.
. Substance abuse benefit - The proposed Humana HMO plan includes a
lifetime maximum benefit of $2,000 for substance abuse treatment. The
current United Healthcare HMO plan limits substance abuse treatment in the
same manner as other mental health services, pre-authorization is required, 30
outpatient visits are allowed each year subject to a copayment of $15 and 30
days of inpatient treatment are allowed each year subject to an inpatient
copayment of $250. We consider this to be a significant decrease in coverage
for both employees and their families.
. Network differences - As with any change in insurers for a medical plan,
while the Humana network is adequate, whenever a change occurs, some
employees and their families will be affected and would need to change
physicians. For example, we have been advised that Dr. Luisa Sztern, one of
the most utilized physicians for City employees and their families, is not on
the Humana network of physicians. Further, there are concerns that
Humana's networks will not provide adequate coverage for employees with
dependents living out of area, such as college students, or retirees living out of
area.
In our opinion, the proposed alternate plans from Aetna, CIONA and Humana do not
meet the City's previously noted renewal goal of not significantly impacting employees.
UNITED HEAL THCARE RENEWAL OPTIONS
At Brown & Brown's direction, United Healthcare offered eight (8) plan design
alternatives to the currently elected HMO/POS dual options, Of these alternatives, all
included plan designs with reductions in benefits through either increased copayments
and/or increased deductibles for employees and their families when health care services
and prescriptions are needed. It is understood that additional options with differing
combinations of increased copayments and deductibles are available,
Two of the alternatives offered were through Neighborhood Health Plan, an HMO owned
by United Healthcare, with a different network centered in South Florida, It is
understood that the provider networks for the Neighborhood Health Plan, while limited to
the Miami-Dade, Broward and Palm Beach areas, are substantial and include most of the
United Healthcare providers in South Florida and additional providers. Since the
Neighborhood Health Plan option will not replace the United Healthcare plans,
employees will have a choice between the United Healthcare plan with a national
provider network or the Neighborhood Health Plan with the more limited local network.
Page 4
2008 Employee Benefit Plan
Review and Recommendations
February 13,2008
Medical Plan Premiums & Contributions
The following shows the current monthly premiums for the United Healthcare medical
plans. Further, the chart shows the current portion paid by the City and by each
employee.
2007/2008 Monthly Premiums
Benefit Tier Enrollment Total City Employee
Paid Paid
HMO Plan (5C)
Employee Only 64 $387.62 $387.62 $0
Employee + Spouse 15 $860.52 $624.07 $236.45
Employee + Children 24 $724.86 $556.24 $168.62
Full Family 28 $1,131.87 $759.75 $372.12
POS Plan (52C+)
Employee Only 2 $408.26 $387.62 $20.64
Employee + Spouse 1 $906.35 $646.99 $259.36
Employee + Children 0 $763.46 $575.54 $187.92
Full Family 1 $1,192.15 $789.89 $402.26
After negotiations initiated by Brown & Brown, United Healthcare has offered a renewal
with an 11,2% increase in premiums. It should be noted that the original United
Healthcare renewal calculations indicated that a 19.0% rate increase would be
forthcoming.
The following are the renewal monthly premiums for the United Healthcare medical
plans. Further, the chart shows the portion paid by the City and by each employee if the
contribution strategy remains unchanged.
2008/2009 Monthly Premiums
Enrollment Total City Employee
Benefit Tier Paid Paid
HMO Plan (5C)
Employee Only 64 $430.62 $430.62 $0
Employee + Spouse 15 $955.18 $692.90 $262.28
Employee + Children 24 $804.59 $617,60 $186.99
Full Family 28 $1256.38 $843.50 $412.88
POS Plan (52C+)
Employee Only 2 $453.17 $430.62 $22.55
Employee + Spouse 1 $1006.05 $718.34 $287,71
Employee + Children 0 $847.44 $639.03 $208.41
Full Family 1 $1323.29 $876.96 $446.33
Page 5
2008 Employee Benefit Plan
Review and Recommendations
February 13,2008
Overall Cost & Cost to the Citv
Assuming the current enrollment does not change, the overall annual cost of the current
plan versus the renewal is:
Current (2007/2008)
Renewal (2008/2009)
$1,076,634
$1,195,065
Increase of $118,431 annually
Assuming that the City continues to pay 100% of the employee premium and 50% of the
dependent premium, and that current enrollment does not change, the City's costs for the
current plan versus the renewal are:
Current (2007/2008)
Renewal (2008/2009)
$853,576
$945,768
Increase of $92, 192 annually
The above figures will be affected by the actual enrollment into the Neighborhood Health
Care Plan option.
Increase in Costs to El11/Jlovees for De/Jendent Coveraze
Based upon the current contribution structure, the City will be paying the majority of the
increased costs for the 2008/2009 year. The following summarizes the monthly and the
"per paycheck" costs to employees and the increase:
HMO
Spouse Coverage
Children Coverage
Family Coverage
Monthly
$262.28
$186.99
$412.88
POS
Employee Coverage
Spouse Coverage
Children Coverage
Family Coverage
Monthly
$ 22.55
$287.71
$208.41
$446.33
Per Paycheck
$121.05
$ 86.30
$190,56
Per Paycheck
$ 10.41
$132.79
$ 96.19
$206.00
Page 6
Increase Per Paycheck
$11. 92
$ 8.48
$18.81
Increase Per Paycheck
$ 0.88
$13.09
$ 9.46
$20.34
2008 Employee Benefit Plan
Review and Recommendations
February 13,2008
We have reviewed the contributions paid by many Florida municipalities and, in our
opinion, the City/Employee sharing of the medical premiums is consistent with the
average Florida municipality. However, we caution that over the next year, we will not
be surprised if budget constraints, particularly for Florida governments which are
dependent upon ad valorem taxes, force changes for many.
Addition o/Neighborhood Health Plan GTJfion
We are recommending that the City allow an additional option through Neighborhood
Health Plan to be offered to employees. The monthly premiums for this plan are:
Employee
Employee + Spouse
Employee + Children
Family
$305.56
$678.35
$571.41
$892.26
These premiums, particularly for employees with dependents, are a significant reduction.
However, the premium reduction is associated with comparable changes in benefits.
Some of the more significant benefit reductions include:
. Increased copayments for physician visits;
. $500 per member, $1,000 per family deductible applying to many services;
. Increased prescription copayments and the addition of a fourth prescription tier
for injectible type drugs covered at only 80%;
. Specific limitations on many benefits, such as chiropractic, dermatology,
substance abuse, mental health, and durable medical equipment;
· Deductible plus $100 copayment applying to many diagnostic tests such as MRIs
and CAT scans; and
· Increased pre-authorization requirements for many services.
Due to the significant benefit reductions, we strongly recommend that in-person
enrollment meetings with Neighborhood Health Care representatives be scheduled to
clearly explain the changes to employees for their review prior to enrollment changes.
Page 7
2008 Employee Benefit Plan
Review and Recommendations
February 13,2008
DENTAL PLANS
The following shows the current monthly premiums for the Guardian dental plan.
Further, the chart shows the current portion paid by the City and by each employee.
2007/2008 Monthly Premiums
Benefit Tier Enrollment Total City Employee
Paid Paid
Guardian
Employee Only 73 $30.11 $30.11 $ 0.00
Employee + Spouse 29 $66.54 $48.33 $18,21
Employee + Children 20 $87.53 $58.82 $28.71
Full Family 29 $116.19 $73.15 $43.04
After negotiations initiated by Brown & Brown, Guardian has offered a renewal with a
5.6% increase in premiums.
The following are the renewal monthly premiums for the Guardian and SunLife dental
plans. Further, the chart shows the portion paid by the City and by each employee if the
contribution strategy remains unchanged.
2008/2009 Monthly Premiums
Benefit Tier Enrollment Total City Employee
Paid Paid
Guardian
Employee Only 73 $31.92 $31.92 $ 0.00
Employee + Spouse 29 $70.53 $51.23 $19.30
Employee + Children 20 $92.78 $62.35 $30.43
Full Family 29 $123.16 $77.54 $45.62
SunLife
Employee Only 73 $28.33 $28.33 $ 0.00
Employee + Spouse 29 $64.44 $46.39 $18,05
Employee + Children 20 $73.03 $50.68 $22.35
Full Family 29 $105.13 $66.73 $38.40
Page 8
2008 Employee Benefit Plan
Review and Recommendations
February 13,2008
Overall Cost & Cost to the Citv
Guardian Dental Plan
Assuming the current enrollment does not change, the overall annual cost of the current
plan versus the renewal is:
Guardian Current (2007/2008)
$110,973
Guardian Renewal (2008/2009)
$117,633
Increase of $6,660 annually
Assuming that the City continues to pay 100% of the employee premium and 50% of the
dependent premium, and that current enrollment does not change, the City's costs for the
current plan versus the renewal are:
Guardian Current (2007/2008)
$82,768
Guardian Renewal (2008/2009)
$87,738
Increase of $4,970 annually
SunLife Dental Plan
Assuming the current enrollment does not change, the overall annual cost of the current
plan versus the proposed SunLife plan is:
Guardian Current (2007/2008)
$110,973
SunLife Proposal (2008/2009)
$101,355
Decrease of$9,618 annually
Assuming that the City continues to pay 100% of the employee premium and 50% of the
dependent premium, and that current enrollment does not change, the City's costs for the
current plan versus the proposed SunLife plan are:
Guardian Current (2007/2008)
$82,768
SunLife Proposal (2008/2009)
$76,346
Decrease of $6,422 annually
Page 9
2008 Employee Benefit Plan
Review and Recommendations
February 13,2008
Decrease in Costs to Emolovees for Deoendent Coverage
Based upon the current contribution structure, the City will be able to save costs with the
proposed SunLife dental plan for the 2008/2009 year. In turn, the City will also pass
along that cost savings to the employees and their families which is significant for many
employees. The following summarizes the monthly and the "per paycheck" costs to
employees and the increase with Guardian versus the decrease with SunLife:
Guardian
Spouse Coverage
Children Coverage
Family Coverage
Monthly
$19.30
$30.43
$4S,62
Per Paycheck
$ 8.91
$14.04
$21.06
Increase Per Paycheck
$ O.SI
$ 0,79
$ 1.20
SunLife
Spouse Coverage
Children Coverage
Family Coverage
Monthly
$18.0S
$22.3S
$38.40
Per Paycheck
$ 8.33
$10,32
$17,72
Decrease Per Paycheck
$ 0.08
$ 2.93
$ 2.IS
Benefit Comoarison
The following summarizes the very similar benefit plans with the two dental insurers:
Guardian SunLife
In-Network Deductible $0 $0
Out-of-Network $SO/Individual ; $SO/Individual ;
Deductible $ISO/Family $ISO/Family
Annual Maximum $I,SOO $I,SOO
In- Out-of- In- Out-of-
Network Network Network Network
Preventative 100% 100% 100% 100%
Basic 100% 80% 100% 80%
Major 60% SO% 60% SO%
Orthodontic SO% SO% 60% SO%
($1,000 Lifetime Max)
Maximum Rollover Yes Yes
Benefit
Page 10
2008 Employee Benefit Plan
Review and Recommendations
February 13,2008
BROKER SERVICE & COMPENSATION ISSUES
Based upon our review of the renewal proposals, insurer and plan design options
presented and the service provided during our requests for additional information, it
appears that Brown & Brown is providing excellent service to the City.
The United Healthcare renewal calculation exhibit which was provided by Brown &
Brown indicates that United Healthcare is paying Brown & Brown a commission of 5%
on the medical premiums. This commission equates to an annual compensation of about
$55,000 for 2007/2008 for the medical for Brown & Brown. We assume there is some
additional compensation for the dental insurance also. This compensation seems
reasonable to us and is consistent with industry standards.
FUTURE CONSIDERATIONS
WELLNESS PROGRAMS
If the City has not initiated a wellness program for employees, we recommend this for all
our clients, Wellness initiatives can be as simple as sponsoring smoking cessation classes
in City facilities, offering discounts on weight management programs or lunch time
walking clubs. Many of our clients have been successful in utilizing existing community
resources for these type services. Also, United Healthcare may be able to provide some
resources for the City to enhance a program.
RENEWAL SCHEDULING
We always recommend that our clients manage the renewal process for insurance instead
of allowing the insurance companies to direct the process. For the 2009 renewal, we
recommend early meetings with both broker and insurer representatives to develop goals
and timelines. Ideally, the renewal will be finalized in time for approval at the January
City Commission meeting so that changes in payroll and enrollment can be processed in
the month of February for the March 151 effective date.
AGING WORKFORCE ISSUES
Over the next few years, the City, like most employers, will be facing an increasing aging
workforce. At this time, six of the City's medical plan participants are 63 years of age or
older (date of birth in 1945 or earlier) and an additional nine employees will reach this
age category in the next five years. In the coming few years, the City will need to focus
on controlling medical plan costs for these employees and retirees, Plan design options,
such as a Medicare supplement type plan for retirees, should be considered.
Page 11
SIVER
9400 Fourth Street North. Suite 119
SI. Petersburg, Florida 33702.2525
Post Office Box 21343
SI. Petersburg. Florida 33742-1343
Telephone: (727) 577-2780
Fax: (727) 579-8692
Email: tcindrich@siver.com
February 15,2008
Thomas Acquaro
Director of Human Resources and Management
City of Sunny Isles Beach
18070 Collins Ave.
Sunny Isles Beach, FL 33160
Re: Update to Benefit Renewal Report dated 02/13/2008
Dear Mr. Acquaro:
This letter is an update on the Benefit Renewal Report that Siver Insurance Consultants
(Siver) submitted to the City of Sunny Isles Beach (City) on February 13, 2008. Since
the date of our report, Siver has received further documentation from Brown & Brown on
proposed medical and dental plans for the City. The following summarizes our review:
· The Blue Cross Blue Shield medical summaries and premiums were received. After
review, the proposals have been found to not be competitive to the renewal of the
United Healthcare plans and the new Neighborhood Health Plan.
· Dental proposals from Blue Cross Blue Shield, Humana and Reliance Standard were
received. After review, all three dental proposals have been found to not be
competitive to the recommended SunLife dental plan.
· Brown & Brown has confirmed with United that they will allow the triple option of
the HMO 5C, POS 52C+ and the new Neighborhood Health Plan at the proposed
premIUms.
Mr. Thomas Acquaro
February 15,2008
Page 2
CLOSING
As always, we appreciate the opportunity to provide consulting services to the City of
Sunny Isles Beach and please let us know if you would like any additional detail
regarding these issues.
Sincerely,
SIVER INSURANCE CONSULTANTS
~~
Theresa Cindrich, RHU
TM C/kg
J:IClientISlB.E\2008IRenewal ReviewlAddendum to Benefit Renewal Ltr 02] 508.doc
To:
Via:
FROM:
DATE:
RE:
City of Sunny Isles Beach
18070 Collins Avenue
Sunny Isles Beach, Florida 33160
Ciry Commission
Norman S. Edelcup, Mqyor
Lewis J. Thaler, Vice Mayor
Roslyn Brezin, Commirrioner
Gerry Goodman, CommirJioner
George "Bud" Scholl, CommirJ/rmer
(305) 947-0606 City Hall
(305) 949-3113 Fax
(305) 947-2150 Building Department
(305) 947-5107 Fax
A. John Szerlag, City Manager
Hans Ottino!, City AI/orney
Jane A. Hines, City Clerk
MEMORANDUM
The Honorable City Commission
A. John Szerlag, City Manager
Doug Haag, Asst. City Manager-Finance
T. Acquaro, Dir. of Human Resources & Risk Management
Yael Londono, HR/Benefits Administrator
March 20, 2008
Health & Dental Insurance Renewals (Calendar Year 2008)
RECOMMENDATION:
It is recommended that the City Commission approve the attached resolution to renew the City's
health insurance with United Health Care and to switch the City's dental insurance provider from
Guardian to Sun Life with a renewal date for both of April I, 2008.
BACKGROUND:
The City's health and dental insurance review team met with the City's insurance broker
representatives Bob Hollander and Samantha Alvarez (Brown & Brown Insurance) in mid-
January to review the initial insurance renewal information that they received from the City's
current health insurance provider, United Health Care, and the dental insurance provider,
Guardian. The health/dental insurance renewal date is March 1, 2008. The insurance review
team members are Asst. City Manager-Finance, Doug Haag, Director of Human Resources &
Risk Management, Tom Acquaro, and HR/Benefits Administrator, Yael Londono.
As indicated on the attached report submitted by Brown & Brown, a total of twelve providers
were canvassed for both health and dental insurance and their input analyzed and options
discussed and further analyzed with the review team. Based on the renewal selection parameters
provided to the team, and to Brown & Brown, which were to provide the same level of benefits
Funding available:
Finance Department
Commission Meeting Date:
j\genda Item No.:
Cover l\kmo I lealth and Dental Renewal 032008
in both health and dental (and for health that it be a national provider), a renewal increase that is
under the given industry standard renewal increase, and'have minimal impact on employees, the
review team fully concurs with the Brown & Brown recommendations.
These recommendations are as follows: regarding health insurance, remain with United Health
Care (UHC) with an 11 % rate increase (under industry standard) and retain the current HMO
plan and the "pay-up" POS plan and, in addition, in order to provide a more affordable Family
Plan option for employees who might otherwise not be able to afford the UHC Family Plan, offer
the lower cost Neighborhood Health Plan (a non-national, local subsidiary of UHC) as a
voluntary option;
Regarding dental insurance, switch from Guardian to Sun Life (with an annual cost savings of
about $9700 over the current plan) which provides the same level of benefits and a comparable
provider network as Guardian and would place the City in an advantageous position next year
with the ability to switch to Lincoln Financial Group which will offer the same level of benefits
at lower rates and has a larger provider list and they will offer a two-year plan.
Funds are currently budgeted in the line item account 5230 within each department and no
transfers are required.
ADDITIONAL INFORMATION:
To ensure that the health and dental insurance recommendations provided by Brown & Brown
Insurance, Inc. met the goals set forth to them which were to control cost increases for the City,
provide the same level of benefits to employees and their families, and have minimal impact
financially on employees and their families, a third party health and dental insurance consultant
was retained to review the Brown & Brown renewal work and recommendations in detail. The
Siver Insurance Consultants reviewed all the provider proposals that were submitted and
prepared a detailed report.
Based upon their review of the proposals and the goals that we set forth, they fully concur with
the Brown & Brown recommendations.
INSURANCE POLICY TIMELINES (FY 2007-08)
Brown & Brown Ins. - Agency Broker
Policy Carrier Eft. Date Exp. Date
Commercial Package Policy PGIT*
Property Coverage PGIT 10/01/07 10/01/08
Bldgs & Personal Property
Rented, Borrowed, Leased Equip.
All Other Inland Marine
Terrorism Risk Insurance None
Liability Coverage PGIT 10/01/07 10/01/08
Comprehensive GL, Bodily Injury, Property
Damage, and Personal Injury
Public Officials Liability
Employment Practices Liability
Employee Benefits Liability
Law Enforcement Liability
Umbrella None
Automobile Coverage PGIT 10/01/07 10/01/08
Auto Liability: Owned, Non-Owned, Hired
Auto Physical Damage: Comprehensive & Collision
Workers Comp Coverage PGIT 10/01/07 10/01/08
Glass US Plate Glass 1/01/08 1/01/09
Flood Hartford/Nat. Flood Ins. 4/01/08 4/01/09
Storage Tank Liability Illinois Union Ins Co. 1/01/08 1/01/09
Crime/Employee Theft Bond (City Mgr) Fidelity & Dep Co of MD 7/01/07 7/01/08
Student Accident Policy (AD & Med) Mutual of Omaha 1/01/08 1/01/09
Benefits Insurance:
Long Term Disability/AD&D Lincoln (Jefferson Pilot) 1/01/08 1/01/09
Life Lincoln (Jefferson Pilot) 1/01/08 1/01/09
Vision EyeMed 1/01/08 1/01/09
Dental Sun Life 3/01/08 3/01/09
Health United Health Care 4/01/08 4/01/09
*Preferred Government Insurance Trust HRD 3/4/08
TO:
FROM:
DATE:
RE:
City of Sunny Isles Beach
18070 Collins Avenue
Sunny Isles Beach, Florida 33160
City Commission
Nonnan S. Edelcup, M"yor
Lewis J. Thaler, Vi(~ M"yor
Roslyn Brczin) COJJ1mifJioner
Jerry Goodman, Commir.rioner
Geo e "Bud" Scholl, GJIJ1mir.rirlller
RECEIVED
(305) 947-0606 City Hall
(305) 949-3113 Fax
(305) 947-2150 Building Department
(305) 947-5107 Fax
FE8 1 3 2008
A. John Szerlag, City M,,",{~er
Hans Ottinot, City /II/omey
Jane A. Hines, City Oerk
CI1Y OF SUNNY ISlES BEACH
OFFICE OF TIfF CffY MANAGER
MEMORANDUM
i\, John Szerlag, City Manager
Doug Haag, Asst. City Manager-Finance OmtJ' ~
T. Acquaro, Dir. of Human Resources & Risk Management 7,<:1
Yael Londono, HR/Benefits Administrator
2/11/08
Health & Dental Insurance Renewals (Calendar Year 2008)
The City's health and dental insurance review team met with the City's insurance broker representatives Bob
Hollander and Samantha Alvarez (Brown & Brown Insurance) in mid-January to review the initial insurance
renewal information that they received from the City's current health insurance provider, United Health Care,
and the dental insurance provider, Guardian. The health/dental insurance renewal date is March 1, 2008.
The insurance review team members are Asst. City Manager-Finance, Doug Haag, Director of Human
Resources & Risk Management, Tom Acquaro, and HR/Benefits Administrator, Yael Londono.
As indicated on the attached report submitted by Brown & Brown, a total of twelve providers were canvassed
for both health and dental insurance and their input analyzed and options discussed and further analyzed with
the review team. Based on the renewal selection parameters provided to the team, and to Brown & Brown,
which were to provide the same level of benefits in both health and dental (and for health that it be a national
provider), a renewal increase that is under the given industry standard renewal increase, and have minimal
impact on employees, the review team fully concurs with the Brown & Brown recommendations.
These recommendations are as follows: regarding health insurance, remain with United Health Care (UHC)
with an 11 % rate increase (under industry standard) and retain the current HMO plan and the "pay-up" POS
plan and, in addition, in order to provide a more affordable Family Plan option for employees who might
otherwise not be able to afford the UHC Family Plan, offer the lower cost Neighborhood Health Plan (a
non-national, local subsidiary of UHC) as a voluntary option;
Regarding dental insurance, switch from Guardian to Sun Life (with an annual cost savings of about $9700
over the current plan) which provides the same level of benefits and a comparable provider network as
Guardian and would place the City in an advantageous position next year with the ability to switch to Lincoln
Financial Group which will offer the same level of benefits at lower rates and has a larger provider list and
they will offer a two-year plan.
Funds are currently budgeted in the line item account 5230 within each department and no transfers are
required.
TO:
FROM:
DATE:
RE:
City of Sunny Isles Beach
18070 Collins Avenue
Sunny Isles Beach, Florida 33160
(305) 947-0606 City Hall
(305) 949-31 13 Fax
(305) 947-2150 Building Department
(305) 947-5107 Fax
City Commission
Norman S, Edelcup, Mayor
Lewis J. Thaler, Vice Mayor
Roslyn Brezin, Commissioner
Gerry Goodman, Commissioner
George "Bud" Scholl, Commissioner
A. John Szerlag, City Manager
Hans Ottinot, Crty Attorney
Jane A. Hines, CMC, City Clerk
MEMORANDUM
Tom Acquaro, Human Resources Director
Priscilla Walker, CMC, Deputy City Cle~~
March 27, 2008
Approval of Health and Dental Insurance Providers
At its regular meeting of March 20, 2008, the City Commission adopted Resolution No. 2008-
1243, which approved the selection of United Healthcare and Neighborhood Health Plan as the
City's health insurance providers and SunLife as the City's dental insurance provider for a one-
year term. Attached is a copy of the approving resolution for your files.
Thank you.
/pw
Attachments
cc: Yael Londono, Benefits Administrator
Health & Dental Insurance Providers Approval Memo