HomeMy WebLinkAboutResolution No. 2017-29CITY OF KENAI
RESOLUTION NO. 2017 -29
Sponsored by: Administration
A RESOLUTION OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, AUTHORIZING THE
CITY MANAGER TO ENTER INTO A CONTRACT WITH PREMERA BLUE CROSS BLUE
SHIELD OF ALASKA TO PROVIDE EMPLOYEE HEALTH CARE TO CITY EMPLOYEES
EFFECTIVE JULY 1, 2017
WHEREAS, Pursuant to KMC 23.40.120 the City provides major medical, dental, and vision
insurance to its employees; and,
WHEREAS, the City's current provider for this insurance, PREMERA Blue Cross Blue Shield of
Alaska; and,
WHEREAS, PREMERA Blue Cross Blue Shield of Alaska has provided a no -shop renewal quote
for continuing coverage at a premium increase of 12.0 %; and,
WHEREAS, providing quality health care is a component of a comprehensive compensation
package which allows the City to recruit and retain quality employees to provide the services of
the City for its residents.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA:
Section 1. That the City Council authorizes the City manager to execute a contract with
PREMERA Blue Cross Blue Shield of Alaska to provide group medical, dental and vision benefits
to the employees of the City of Kenai effective July 1, 2017.
PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this 7th day of June, 2017
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ATTEST: I _�
tie Heinz, Acting City <erk
Approved by Finance Z- -(Contingent upon passage of Ordinance 2961 -2017)
IM�ayC w;d a Past elit w;d a f t�
210 Fidalgo Ave, Kenai, Alaska 99611 -7794
Telephone: (907) 283 -7535 1 Fax: (907) 283 -3014
ttie city of www.kenai.city
KENM,ALASKA
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MEMORANDUM
TO: Mayor Brian Gabriel and Kenai City Council
1P C
THROUGH: Paul Ostrander, City Manager
FROM: Terry Eubank, Finance Director
DATE: May 31, 2017
SUBJECT: Employee Health Insurance Renewal
The purpose of the memo is to recommend passage of Resolution 2017 -29 that will authorize
renewal of the City's employee health care plan with PREMERA Blue Cross Blue Shield of Alaska.
KMC 23.40.120 requires the City to provide medical, dental and vision coverage to its employees.
This coverage has been provided by PREMERA Blue Cross Blue Shield of Alaska since July
2014.
The City received a no bid renewal quote from PREMERA Blue Cross Blue Shield of Alaska to
renew its current insurance, PREMERA's Plus Envoy Plan, at a 15.0% increase over FY17 rates.
Through negotiations the increase was reduced to a no bid offer of 12.0 %. Acceptance of a no
bid quote or offer precludes the City from soliciting quotes from other providers. Quoted premiums
were compared to the premiums of the State of Alaska Political Subdivision Health Insurance
Plan, which the City participated in, to assure competiveness. PREMERA's quote, despite the
12.00)o increase, is still lower than the State's plan.
The following is a financial comparison of the City's current plan and the proposed plan.
Health Care Premium
City Self- Insured Deductible
FSA/HRA Administration
Employee Life Insurance
Broker Fee
Employee Wellness Program
Total Cost of Health Care
City Funded Portion
Employee Funded Portion
Total
FYI 7PREMERA
$1,675,422
159,656
4,022
16,800
25,000
20.000
$1�
$1,728,433 90.93%
172.467 9.07%
FYI PREMERA Difference
$1,912,468
$237,046
164,775
5,119
4,200
178
16,800
-0-
25,000
-0-
20.000
-0-
$�
$242 0
$1,916,947 89.44% 188,514
226.296 10.56% 53,829
$ 100.00% S242-343
Page 2 of 2
Employee Health Insurance Renewal
A comparison of employee monthly health care premiums is as follows:
I recommend renewal with PREMERA Blue Cross Blue Shield of Alaska and believe it is in the
best interest of the City and its employees.
FYI PREMERA
FY18 PREMERA
Differenc
Employee
$ 71.00
$ 92.00
$ 21.00
Employee /Child(ren)
128.00
166.00
38.00
Employee /Spouse
140.00
182.00
41.00
Employee /Family
191.00
249.00
58.00
Part time Employee
369.00
420.00
51.00
I recommend renewal with PREMERA Blue Cross Blue Shield of Alaska and believe it is in the
best interest of the City and its employees.