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� y � I��q u�s� for Council Action 101� 7/05 Item Number: 6. Department Approval Manager Approval Agenda Section Item Description: 2006 City Insurances Renewal & Cafeteria Contributions Medical Backeround and Renewal: Each year the largest human resources expense aside from employee salaries is the cost of medical insurance. This amounted to roughly $1.2 million in 2005. As this expense continues to rise with no end in sight all organizations are making changes to help ease the impact for both employees and the business. Over the last several years Roseville has made changes and additions in this area to minimize the increases and to share the burden while making this insurance as effective as possible. Roseville has traditionally provided a comprehensive plan with a small co-pay and 100% coverage. In response to escalating health care costs, the City began offering higher deductible plans with additional tiers of coverage In January 1,2004 we added a single-plus-one tier option to give employees and retirees the least expensive and most efficient alternatives. In 2005, the City even added a 1,000 Deductible plan with a Health Reimbursement Account for payment of deductible expenses. The City currently offers three medical options and three tiers through one provider, Health Partners. (Employees are eligible if they work a minimum of 20 hours per week and there are 158 total eligible employees comprising of 144 full-time and 14 part-time. We currently have 19 that are on the City's health plan due to COBRA events such as retirement.) The City of Roseville's contract with Health Partners for employee health insurance will expire on December 31,2005. Staff issued an RFP for 2006 Health Insurance in August and received responses from three companies and bid decline letter from Preferred One in September. Open enrollment is scheduled to begin on November 9th. Following receipt of the proposals this year, staff shared cost and coverage information with the City Benefits and Wellness Committee, a representative committee of city employees. Medica and Blue Cross both came in with original proposals that resulted in a 13% overall increase, while Health Partners bid would only come down �r� the original 29% (pre-bid offering) increase to 21 %.