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Memo - City Council 2015 Budget and Tax Levy Discussions 6 helped to lower those costs. All union employees are on the union plan for medical and dental and pay the same whether they have single or family coverage. $300 Deductible $300 Deductible Embedded Co-Pay Co-Pay $1,600 HD Plan $3,200 HD Plan $3,125 HD Plan $6,250 HD Plan Incr Incr Year Single Family Single Family Single Family %Union % 2004 365.90 807.89 12.25%600.00 9.09% 2005 433.43 953.07 18.46%650.00 8.33% 2006 473.96 1,040.88 9.35%700.00 7.69% 2007 507.54 1,114.35 469.54 1,032.85 7.08%750.00 7.14% *2008 531.21 1,152.15 466.21 1,013.15 4.66%820.00 9.33% *2009 553.11 1,213.40 485.61 1,068.90 4.12%850.00 3.66% *2010 560.38 1,231.12 492.38 1,085.12 1.31%905.00 6.47% #*2011 493.49 1,088.40 433.99 961.90 -11.94%922.00 1.88% *2012 511.31 1,127.31 449.81 996.31 3.61%942.00 2.17% 2013 471.68 1,044.37 418.68 930.37 4.86%962.00 2.12% 2014 473.16 1,048.74 420.16 934.74 0.31%1,012.00 5.20% 2015 No increase is planned in medical - dental is not in yet *Council mandated that parity benefit was only given to those that took HD options, none if Co-Pay option #Coop went out for bids and due to favorable history of claims reduced our rate All union employee pay same rate whether single or family All non-union employees are required to take, at a minimum, single dental and single medical insurance As you can see from the chart above, once the City offered the high deductible plans, we were successful in lowering our increases dramatically. The Council only allowing Benefit Parity if employees took the High Deductible option was a big factor in having our employees shift away from the Co-Pay Plan. Some years (especially 2009, 2012, and 2013) we only received rate increases as a result of a State Statute that governed small group plans – we only have 25-27 employees on our health and dental insurance as union members are on the union insurance. As a result, the cooperative that we are a part of, Lakes Country, gave us dividends back since they could not drop our rates lower. We received $24,288.74 in 2010 based on our 2009 claims history, $18,373.97 in 2011 based on 2010 claims history, and $9,118.73 in 2013 based on 2012 claims history. We received a decrease in rates for 2011 as the cooperative went out for bids and they were able to reduce our costs based on our favorable claims history. While Lakes Country would like to see these funds distributed back to the employees on the plan, the City choose to put these monies aside and use for wellness activities as these savings or the reduced usage was a direct result of wellness activities we instituted in 2009. We have also used them to offset the City’s share of the insurance increases when levy limits were effective. Experience has shown that people use health services differently if they are on a Co-Pay Plan versus a High Deductible Plan. The end result is lower rates based on usage history. In survey’s from surrounding employers, both small and large – we have found that we have had one of the most favorable experiences with health care costs as most cities were fighting double