R-1643 - 05/23/2017 - PERSONNEL - Resolutions Supporting Documents BOARD OF TRUSTEES MEETING
VILLAGE of SAMUEL E. DEAN BOARD ROOM
OAK B R . K , BUTLER GOVERNMENT CENTER
1200 OAK BROOK ROAD
OAK BROOK, ILLINOIS
630-368-5000
AGENDA ITEM
Regular Board of Trustees Meeting
of
May 23,2017
SUBJECT: Health, Third Party Administrator and Stop Loss Insurance,Dental,
Life/AD&D Insurance, Vision Insurance & Telemedicine
Agreements for 2017 - 2018 Plan Year
FROM: Riccardo F. Ginex, Village Manager
BUDGET SOURCE/BUDGET IMPACT: Program 158-Employee Benefits
RECOMMENDED MOTION: I move to approve Resolution R-1643 a Resolution
Approving the Waiver of Competitive Bidding and Authorizing the Purchase of Insurance
Benefits for Employees and direct staff to execute Agreements after receiving final
attorney review with BlueCross BlueShield (BC/BS) of Illinois for Group Health
Insurance Coverage, Third Party Administrator (TPA) Service, and Stop Loss
Insurance for the Plan Year starting July 1, 2017 through June 30,2018. Further, I
move to approve the staff recommendation and direct staff to execute an Agreement
after receiving final attorney review with Delta Dental & 1-80OMD for the Plan Year
starting July 1,2017 through June 30, 2018.
Background/History:
The Village operates a self-insured health insurance program for all PPO claims on a
per individual basis for the first $85,000 ("individual specific attachment point") of
claims in a given plan year (July 1 to June 30). This program has been in place in
this format since 1993, but with different • specific attachment points and TPAs.
The Village secures Stop Loss Coverage for claims that exceed $85,000 per
individual or over 125% of the annual aggregate specific attachment point of
expected claims. The Village health benefit program has approximately 152
employees, which includes approximately 34 retirees (retirees/COBRA employees
on the traditional insurance plan who pay 100% of the equivalent premium for
their coverage) in the program, plus eligible dependents for a total of
approximately 397 participants. The Oak Brook Park District is also on our plan
paying the full premium cost for all eligible individuals. The Village also offers a
fully-insured HMO plan to all employees.
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Renewal Information:
Our medical and dental plans were up for renewal. The medical plan was marketed by our
broker Vista National, to five providers, all who were either uncompetitive of declined to
quote. The HMO medical plan was marketed to five carriers (UHC, Aetna, Humana,
Mertiain and Cigna). All markets declined to quote. The primary reason for declination
was due to their rates being uncompetitive. Due to our enrollment on the PPO medical plan,
BCBS will not allow us to carve out the Stop Loss. They require at least 250 enrolled.
Medical: After negotiations, BC/BS's final proposal has a rate increase of 0.11%
(approximately $3,268) higher than our current plan year. When reviewing the BC/BS
proposal, there are a few key areas to highlight. The first is the estimated fixed costs.
This was increased by 0.89% or approximately $3,268. Next, was claim liability, were
there was no change.
There will be no increase to the HMO portion of the medical for the 2017 — 2018 policy
year. Lastly, there are the Affordable Care Act (ACA) fees, which are decreasing with
this plan year. The estimated total cost for the PPO policies will be around $861.49 for
this plan which is now only the Patient-Centered Outcomes Research Institute Fee. The last
year for the Transitional Reinsurance fee was 2016. The Village avoids paying the
Insurance Industry Fee by continuing to be self-funded on the PPO policies. If we were
subject to the fee, it would increase costs by approximately 3 to 4%. The Village does pay
that 3 to 4%on the HMO within the premiums along with the PCORI fee.
Dental: This year, the Village's dental insurance was also up for renewal. The Village will
be transitioning from Lincoln Financial back to Delta Dental. The cost to ether move to
Delta or stay with Lincoln was virtual the same. The Village has also decided to enhance the
Dental plan by change the preventative care benefit from 80% coverage to 100% for both in
and out of network services. The dental rate is being proposed for 1 year.
Life/AD&D: The Village is currently in the middle of a 2 year rate guarantee with Dearborn
national which will expire on July 1, 2018. Therefore, there will be no additional costs
associated with this benefit.
Vision: The Village is currently in the middle of a four year agreement with EyeMed for
vision insurance which will expire on July 1, 2018. Therefore, there will be no additional
costs associated with this benefit plans.
Telemedicine: The Village has decided to move away from Healthiest You to another
Telemedicine vendor by the name of 1-80OMD effective 7/1/2017. The cost will be going
from$8.00 PEPM to $2.48 PEPM.
Finally, we will also be looking to transition the post 65 Retirees on our current Medical plan
to a post 65 retiree carve out plan through The Hartford. The Retirees will have access to the
same benefits, at a reduced costs.
There will be no increase this year to the premium equivalent rates and they will remain the
same for the 2017—2018 policy year.
The Village will continue to promote its wellness program allowing those who receive
insurance up to 2% off their premium and for those without insurance the opportunity to
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receive gift cards for achieving pre-determined wellness goals. Overall, the program
continues to provide many opportunities for employees to continue their healthy efforts.
These programs include annual wellness evaluation, lunch and learn programming and
group fitness activities such as the pink 5k event at the Oak Brook Park District.
Recommendation:
The Board approves the Resolution as presented.
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RESOLUTION 2017-PL-IS-R-1643
A RESOLUTION APPROVING THE WAIVER OF COMPETITIVE BIDDING AND AUTHORIZING
THE PURCHASE OF INSURANCE BENEFITS FOR EMPLOYEES
WHEREAS, the Village provides its employees with health and dental insurance benefits
(collectively, "Insurance Plans'); and
WHEREAS, the Village currently purchases health insurance coverage, third-party administrator
services, and stop loss insurance from BlueCross BlueShield of Illinois(collectively, "BC/BS Plans'); and
WHEREAS, the Village currently purchases dental insurance coverage from Lincoln Financial
("Lincoln Plan'; and
WHEREAS,the Insurance Plans are up for renewal; and
WHEREAS, instead of putting the purchase of the Insurance Plans out to bid or request for
competitive proposals, the Village Board has once again retained Vista National Insurance Group, Inc. to
market the Insurance Plans to various insurance providers to obtain the most advantageous Insurance
Plans for the Village; and
WHEREAS, because the Village retained Vista National Insurance Group, Inc. to obtain quotes
from various insurance providers, and the Village Board believes that Vista National Insurance Group,
Inc. has negotiated for the purchase of Insurance Plans that are advantageous to the Village, Village staff
has recommended that the Village waive competitive bidding for the purchase of the Insurance Plans;
and
WHEREAS, Village staff has recommended that the Village Board renew the BC/BS Plans, but
replace the Lincoln Plan and authorize an agreement with Delta Dental ("Delta's, a former vendor for the
Village's dental insurance for the period July 1, 2017 through June 30, 2018; and
WHEREAS, the President and Board of Trustees, being fully advised in the premises, have
determined that it is in the best interests of the Village and its residents to so waive competitive bidding
and to approve the Insurance Plans, all subject to the appropriation of sufficient funds for the Insurance
Plans in the future fiscal year;
NOW THEREFORE, BE IT RESOLVED BY THE PRESIDENT AND BOARD OF TRUSTEES OF
THE VILLAGE OF OAK BROOK, DU PAGE AND COOK COUNTIES, ILLINOIS as follows:
Section 1: Recitals. The foregoing recitals are hereby incorporated into, and made a part
of, this Resolution as the findings of the President and Board of Trustees of the Village of Oak Brook.
Section 2: Waiver of Competitive Bidding Reguirements. The advertising and bidding
requirements for the purchase of the Insurance Plans are hereby waived in accordance with Section 1-7-
4 of the Village Code.
Section 3: Authorization of Insurance Plan. The purchase of the Insurance Plans is hereby
authorized.
Section 4: Execution of Required Documentation. The President, Village Manager, and the
Village Clerk shall be, and are hereby, authorized to execute and attest, on behalf of the Village all
documents necessary to complete the purchase of the Insurance Plans pursuant to Section 3 of this
Resolution,which documentation shall be in a final form approved by the Village Attorney.
Resolution 2017-PL-IS-R-1643
Approving the Purchase of
Insurance Plans
Page 2 of 2
Section 5: Effective Date. This Resolution shall be in full force and effect from and after its
passage by two-thirds of the Trustees and its approval in the manner provided by law.
APPROVED THIS 23rd day of May, 2017
Gopal G. Lalmalani
Village President
PASSED THIS 23rd day of May, 2017
Ayes:
Nays:
Absent:
ATTEST:
Charlotte K. Pruss
Village Clerk