Action 12.
Regular Board of Supervisors Meeting
Human Resources
- Meeting Date:
- 03/12/2013
- Title:
- Cochise Combined Trust schedule of benefits and rates for FY 2013-2014.
- Submitted By:
- Kelley Jones, Human Resources
- Department:
- Human Resources
Presentation:
No A/V Presentation
Recommendation:
Approve
Document Signatures:
BOS Signature NOT Required
# of ORIGINALS
Submitted for Signature:
Submitted for Signature:
2
NAME
of PRESENTER:
of PRESENTER:
Michael Ortega
TITLE
of PRESENTER:
of PRESENTER:
County Administrator
Mandated Function?:
Not Mandated
Source of Mandate
or Basis for Support?:
or Basis for Support?:
Docket Number (If applicable):
Information
Agenda Item Text:
Approve the funding for the proposed schedule of benefits and rates adopted by the Cochise Combined Trust for fiscal year 2013-2014.
Background:
Cochise County has been a participating entity in the Cochise Combined Trust (CCT) since July 1, 2002. The Cochise Combined Trust has been administered through Erin Collins & Associates. During that time Administrative Enterprises was the third party administrator for insurance claims and payments.
Since July 1, 2002, the Board of Supervisors has approved, with the exception of FY 2006-2007, to absorb the increases in the health insurance premiums and have not increased the employees' contribution to the health insurance. The employees had a slight decrease in health insurance premiums in FY 2007-2008 and continue to pay that same premium.
Based on the information received from the Trust adminstrators, they project an increase in the overall costs to the County of approximately $153,000 for FY 13/14. The translates into an increase of just under 2%. As a result of past years’ performance of the Trust, approximately $2 million is in reserves. Given this reserve amount, the County Administrator is recommending increasing the per member rate, but not increasing the amount paid into the Trust by either the County or employees. In essence, employees applying for coverage under COBRA and retirees would see an increase in their contribution amounts. A portion of CCT reserves would be used to cover the projected shortfall.
Beginning August 20, 2012, Meritain Health Services aquired Administrative Enterprises, Inc. as the third party administrator for the CCT. As of that date, Meritain Health Services has not accurately processed claims and the CCT requested that Erin Collins and Associates initiate the request for proposal (RFP) process for a new TPA.
On February 20, 2013 at their annual retreat, Cochise Combined Trust (CCT) board members voted unanimously to approve and adopt the FY 2013-2014 CCT annual schedule of benefits and rates along with approving and adopting the change of the third party administrator (TPA) for the health insurance to AmeriBen effective July 1, 2013. The current TPA, Meritain, will no longer be the provider of the CCT's health insurance administration and claims.
Since July 1, 2002, the Board of Supervisors has approved, with the exception of FY 2006-2007, to absorb the increases in the health insurance premiums and have not increased the employees' contribution to the health insurance. The employees had a slight decrease in health insurance premiums in FY 2007-2008 and continue to pay that same premium.
Based on the information received from the Trust adminstrators, they project an increase in the overall costs to the County of approximately $153,000 for FY 13/14. The translates into an increase of just under 2%. As a result of past years’ performance of the Trust, approximately $2 million is in reserves. Given this reserve amount, the County Administrator is recommending increasing the per member rate, but not increasing the amount paid into the Trust by either the County or employees. In essence, employees applying for coverage under COBRA and retirees would see an increase in their contribution amounts. A portion of CCT reserves would be used to cover the projected shortfall.
Beginning August 20, 2012, Meritain Health Services aquired Administrative Enterprises, Inc. as the third party administrator for the CCT. As of that date, Meritain Health Services has not accurately processed claims and the CCT requested that Erin Collins and Associates initiate the request for proposal (RFP) process for a new TPA.
On February 20, 2013 at their annual retreat, Cochise Combined Trust (CCT) board members voted unanimously to approve and adopt the FY 2013-2014 CCT annual schedule of benefits and rates along with approving and adopting the change of the third party administrator (TPA) for the health insurance to AmeriBen effective July 1, 2013. The current TPA, Meritain, will no longer be the provider of the CCT's health insurance administration and claims.
Department's Next Steps (if approved):
The County's open enrollment process will commence April 1, 2013 through April 30, 2013 with the changes in the benefits to take effect July 1, 2013. Employees will be notified during open enrollment of all benefit changes effective July 1, 2013 to include the change to the new TPA, dental and prescription programs.
Impact of NOT Approving/Alternatives:
Should the BOS not approve the increase in rates, the amount paid by employees on COBRA and Retirees would not cover the cost of their insurance and the CCT Cash Carry Forward would absorb all costs in excess of $7.5 million.
To BOS Staff: Document Disposition/Follow-Up:
No follow up needed.
Fiscal Impact
- Fiscal Year:
- 2013-2014
- One-time Fixed Costs? ($$$):
- Ongoing Costs? ($$$):
- County Match Required? ($$$):
- A-87 Overhead Amt? (Co. Cost Allocation $$$):
- Source of Funding?:
Fiscal Impact & Funding Sources (if known):
Fiscal impact is $7,500,000. Funding sources include budgeted funds from all departments and employee contributions.