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e r I o ei e ®~d aye ct® er 7 age 6 hers would review the proposals of the Ethics Commission, including the pro- posed training sessions and topics as proposed. Ms. Bacon reviewed the ongoing and alarming increases in employee medical in- surance; 2007 comparisons and projected 2008 premium increases; responses to escalating health care costs through higher deductible plans and additional tiers of coverage; and Health Reimbursement Accounts (RBA's) for the payment of de- ductible expenses. Ms. Bacon reviewed the current provider, Medica; recent Re- quest for Proposals (RFP's) for 2008 Health Insurance, with Medica's contract expiring December 31, 2007, and resulting bid decline letters from numerous companies due to their inability to compete with the Medica initial renewal rate of 42%, with the State's plan (PEIP) bidding, but at an increase of 46%. Ms. Bacon advised that staff and the City's benefits broker, Financial Concepts, negotiated with Medica for a reduced increase to 33.2% by moving into one of Medica's standard plans for ease of administration. Ms. Bacon noted that this was incorpo- rated with ideas generated by the City's Benefits and Wellness Committee to pro- vide cost savings from their respective employee groups. Ms. Bacon reviewed concerns shared by the Committee that the comprehensive 100% coverage plan had a claims to premium ratio of 226%, with thirty-five (35) employees in that plan supplemented by all other staff, and determining that it can no longer be sustained., since those employees see no incentive to manage expenses, in how, when or where they seek medical attention. Ms. Bacon advised that staff was recommending discontinuation of this comprehensive 100% Plan as a choice. Ms. Bacon reviewed four (4) plan design changes as follows: 1) increasing the co-pay for the three (3) tier prescription co-pay; 2) increasing the office visit co-pay; 3) increasing the deductible amounts on the 80/20 and High Deductible plans; and 4) increasing the out-of-pocket maximums to better fit with Medica's standard plans. Ms. Bacon noted that staff was also recommending that the City increase the con- tribution amounts to the HRA to help offset the higher deductible and out-of- pocket maximums to better protect staff willing to take on more potential risk and utilize the City's budgeted dollars by providing a means for staff to move toward consumerism in their health care purchases. Ms. Bacon provided detailed comparison information in the staff report.