Consider a Resolution to Approve 2012 Non-Union Health Insurance Contributions and 2012 Non-Union Cost of Living Adjustments (COLA)

Health Insurance for 2012: 
On October 11, 2011, the City Council approved the City to change health insurance carriers from HealthPartners to Blue Cross and Blue Shield as part of the LOGIS Consortium.  The City benefits joining the LOGIS group and BCBS, as follows: opportunity to join a larger group, tiered plan options which includes single, single plus child(ren), single plus spouse, and family; which will better meet employees’ actual coverage needs (as compared to only single and family plan options under HealthPartners), options for higher deductible plans; $4000 Single & $8000 Family (as compared to the current maximum deductible of $2000 Single & $4000 Family under HealthPartners), four years of rate caps as follows: 9% in 2013, 10% in 2014, 11% in 2015, and 12% in 2016--which are not contingent upon a service contract, two networks for employees to choose from based on their healthcare needs (as compared to one under HealthPartners), 100% coverage (in most plans) after the deductible is satisfied (as compared to 80% under HealthPartners), less expensive basic life insurance, approximately $500.00 contribution per year toward the OPEP GASB Statement No. 45 valuation fee, and more plan options.

The City health insurance contributions listed below are the same contributions that have been negotiated with all other employee groups (AFSCME, LELS-Patrol and LELS-Sergeants).  Note:  in order to ease administration of the benefits and to maintain consistency (aside from the funding toward the co-pay plan) all contributions are set at an equal amount for each tier level (Family, Employee only, Employee+Spouse, Employee+Children). 

Cost of Living Adjustment (COLA) for 2012:
Wages for all City staff have been frozen for two years with the last increase authorized as of January 1, 2009 (no increases were given for 2010 or 2011).   The City Council authorized a two percent (2%) increase as part both the LELS Patrol and LELS Sergeants 2011 - 2012 contracts effective January 1, 2012.  Earlier this evening, the Personnel Committee considered a case to settle the AFSCME contract, which also included a 2% increase to wages.   The non-union wage scale, at this time, reflects 2009 wages.  Staff has surveyed other comparable cities in the area and a 2% increase is within the trend for 2012.

	Monthly Premium	City Cont. to Prem. Per Month	Employee Cost for Premium per Month	City Cont. to VEBA	Total City Contribution
Family
100% $30.00 co-pay	$2,057.00	$831.56	$1,225.44	NA	$831.56
$1500/$3000 Ded. Plan w/VEBA	$1,745.00	$1,048.00	$697.00	$192.00	$1,240.00
$2500/$5000 Ded. Plan w/VEBA	$1,608.00	$1,048.00	$560.00	$192.00	$1,240.00
$4000/$8000 Ded. Plan w/VEBA	$1,418.00	$1,048.00	$370.00	$192.00	$1,240.00
Employee Only
100% $30.00 co-pay	$791.00	$517.14	$273.86	NA	$517.14
$1500/$3000 Ded. Plan w/VEBA	$671.00	$570.00	$101.00	$130.00	$700.00
$2500/$5000 Ded. Plan w/VEBA	$618.50	$570.00	$48.50	$130.00	$700.00
$4000/8000 Ded. Plan w/VEBA	$545.00	$545.00	$0.00	$155.00	$700.00
Employee Plus Spouse
100% $30.00 co-pay	$1,661.00	$831.56	$829.44	NA	$831.56
$1500/$3000 Ded. Plan w/VEBA	$1,409.50	$815.00	$594.50	$160.00	$975.00
$2500/$5000 Ded. Plan w/VEBA	$1,298.50	$815.00	$483.50	$160.00	$975.00
$4000/$8000 Ded. Plan w/VEBA	$1,145.00	$815.00	$330.00	$160.00	$975.00
Employee Plus Child(ren)
100% $30.00 co-pay	$1,582.00	$831.56	$750.44	NA	$831.56
$1500/$3000 Ded. Plan w/VEBA	$1,342.00	$890.00	$452.00	$160.00	$1,050.00
$2500/$5000 Ded. Plan w/VEBA	$1,236.50	$890.00	$346.50	$160.00	$1,050.00
$4000/$8000 Ded. Plan w/VEBA	$1,090.50	$890.00	$200.50	$160.00	$1,050.00
*The City’s 2012 VEBA contribution includes the $4.30 monthly claims fee.

Make a motion to approve  the above listed city health insurance contributions and to increase the non-union wage scale by two percent (2%). 

Funding for both city contributions to health insurance and cost of living adjustment are included in the 2012 general fund budget. 

Make a motion to confirm the recommendation of the Personnel Committee to approve the above listed city health insurance contributions and to increase the non-union wage scale by two percent (2%).