HomeMy WebLinkAboutResolution No. 2018-26Sponsored by: Administration
CITY OF KENAI
RESOLUTION NO. 2018-26
A RESOLUTION OF THE COUNCIL OF THE CITY OF KENAI , ALASKA, AUTHORIZING A
CONTRACT WITH PREMERA BLUE CROSS BLUE SHIELD OF ALASKA TO PROVIDE
EMPLOYEE HEALTH CARE TO CITY EMPLOYEES EFFECTIVE JULY 1, 2018 .
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 is 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 7 .88% including changes in employee census;
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, 2018 .
Secti on 2. That this resolution takes effect immediately upon passage.
PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this 6th day of June, 2018.
~ -og;g_e ~
BRIAN GABRIEL SR., MAYOR
'Utt~ tt1/ti a Pa~~ e-c, tt1/ti a h.tu.r-~ II
21 0 Fidalgo Ave , Kena i , A laska 99611 -7794
Telephone : (907) 283-75351 Fax: (907) 283-30 14
www . kenai.city
MEMORANDUM
TO:
THROUGH :
FROM:
DATE:
SUBJECT:
Mayor Brian Gabriel and Kenai City Council
Paul Ostrander, City Manager
Terry Eubank, Finance Director
May 22, 2018
Resolution No. 2018-26 -Employee Health Insurance Renewal
The purpose of the memo is to recommend passage of Resolution 2018-26 that will authorize
renewal of the City's employee health care plan with PREM ERA 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 s ince July
2014.
The City received a no bid renewal quote from PREMERA Blue Cross Blue Shield of Alaska to
renew its insurance, PREMERA's Preferred Choice Plan, at a 9.28% increase over FY18 rates,
dental rates will increase 3.0% and there is no rate change for vision coverage. 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 combined 8.8% 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
Dental Premium
Vision
City Self-Insured Deductible
FSA/HRA Administration
Employee Life Insurance
Broker Fee
Employee Wellness Program
Total Cost of Health Care
FY18 PRE M E RA
$1,829,175
116,064
16,392
169,650
4,242
16,800
25,000
20.000
$2.197.323
FY19 PREM ERA
$1 ,998 ,916
119,546
16,392
169,650
4 ,242
16,800
25,000
20 .000
$2 .370.546
Difference
$169,741
3,482
$173.223
Page 2 of 2
Employee Health Insurance Renewal
City Funded Portion
Employee Funded Portion
Total
$1,973,679 89 .82%
223,644 10 .18%
$2.197 .323 100,00%
$2 ,129,142 89 .82% 155,463
241.404 10.18% 17,760
$2.370.546 100,00% $173.223
A comparison of employee monthly health care premiums is as follows :
Employee
Employee/Child(ren)
Employee/Spouse
Employee/Family
Part time Employee
FY18 PREM ERA
$ 92.00
166.00
182.00
249.00
420.00
Monthly Premium
FY19 PREMERA
$102.00
185.00
203.00
278.00
475.00
Difference
$ 10.00
19.00
21 .00
29.00
55.00
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.