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HomeMy WebLinkAboutPR 20563: BLUE CROSS MEDICARE ADVANTAGE PPO AND PRESCRIPTION DRUG PLAN 4#10 c17.1 or! rthr r True INTEROFFICE MEMORANDUM Human Resources Department Date: October 30, 2018 To: Harvey L. Robinson, Interim City Manager From: Elizabeth Diaz, Acting Human Resources Director Patricia Davis, Human Resources Training Manager RE: Blue Cross Medicare Advantage Renewal Effective 1/01/19 P. R No. 20563 - A Resolution Authorizing The City Manager To Execute Contracts Between Its Third Party Administrator(Blue Cross and Blue Shield of Texas, Inc.) For The City of Port Arthur Blue Cross Medicare Advantage PPO and Prescription Drug Plan for its Existing Medicare Eligible Retirees and/or Their Medicare Eligible Dependent(s) Nature of the request: The City of Port Arthur provides access to their Medicare eligible retirees and/or their Medicare eligible dependent(s) to the Blue Cross Medicare Advantage PPO and Prescription Drug Plan for major medical health insurance coverage, including prescription drug coverage. Medicare eligible retirees and their Medicare eligible dependent(s) transitioned to the Blue Cross Medicare Advantage PPO and Prescription Drug Plan effective on 11/1/2016. Staff Analysis, Considerations: The City of Port Arthur has a Preferred Provider Organization (PPO) insurance format which provides participants in the selection of health care providers. This format has been deemed most beneficial for plan participants and most compatible with our organizational culture. The upcoming 1/1/2019 renewal has presented a substantial increase of 15%over last year's renewal of 6%. Per the attached, it has been determined that this year's 15% increase was principally due to high utilization of claims experience incurred during the current plan year to date. There are approximately 125 Medicare eligible retirees and/or Medicare dependents on the plan. The writers, Ms. Rebecca Underhill,Assistant City Manager/Administration,and Mr. Mickey Moshier,the City's Insurance Consultant, met to consider the BC/BS proposal as presented along with discussing other options to mitigate the significant increase. Harvey L. Robinson, Interim City Manager Page 2 of 2 P.R. #20563 The attached renewal not only includes the City's current benefit levels along with cost, but also several other plan alternatives to reduce costs. However, due to limited time constraints, staff is recommending the following proposed renewal for 1/1/2019 for your review and consideration: 1. Staff is recommending we accept the 1/1/2019 proposal as presented by Blue Cross and Blue Shield of Texas,Inc. which includes a 15%increase over last year's 6%. 2. No change in the current benefit levels as follows: • $0 Annual Deductible • Maximum Out-of-Pocket$1,500 • Level Copays • SilverSneakers Program(i.e. YMCA, Curves, World Gym,etc.) • Hearing Aid Benefits • Incentives totaling$100/per year for Wellness Benefits Staff views the health insurance benefit as an earned as well as deserved benefit for its City retirees, and will continue to strive to provide the best health plan available at the best price to all of its plan participants. However, due to the significant increase incurred in the 2019 renewal, this will allow staff time to prepare Request for Proposals (RFP's) as we move to the next renewal period. Staff is committed to accomplish these goals for the reasons as delineated below: 1. Considerations of other Medicare Advantage PPO and Prescription Drug Plans by other major carriers as well as other supplemental plans. 2. Currently all impacted Medicare eligible retirees and/or their Medicare eligible dependent(s) are required to pay 100% of their premium cost. However, effective on 1/1/2019, Medicare eligible retirees will be required to pay 50%of the proposed monthly premium cost. Recommendation: It is recommended that the City Council adopt P. R. No. 20563 authorizing the renewal of the Blue Cross Medicare Advantage PPO and Prescription Drug Plan for its Medicare eligible retirees and/or their Medicare eligible dependent(s), and authorizing the City Manager to execute all documents necessary for its 1/01/19-12/31/20 plan year. Budget Considerations: Approval of P. R.No. 20563 will have a budgetary impact of$110,000 which is available in the FY 2018-19 Health Insurance Fund(614-1701-583.18-03). "Remember we are here to serve the Citizens of Port Arthur P.R. No. 20563 10/30/2018—evd/pd Updated RESOLUTION NO. A RESOLUTION AUTHORIZING THE CITY MANAGER TO EXECUTE CONTRACTS BETWEEN ITS THIRD PARTY ADMINISTRATOR (ADMINISTRATIVE SERVICES ONLY) FOR THE CITY OF PORT ARTHUR BLUE CROSS MEDICARE ADVANTAGE PPO AND PRESCRIPTION DRUG PLAN FOR ITS MEDICARE ELIGIBLE DEPENDENT(S),AND AUTHORIZING THE CITY MANAGER TO EXECUTE ALL DOCUMENTS FUND NO: 614-1701-583.18-03 (HEALTH INSURANCE FUND) WHEREAS, the City Council of the City of Port Arthur deems it necessary and appropriate to provide major medical health care benefits along with a prescription drug benefit to its Medicare eligible retirees and/or Medicare eligible dependent(s) effective 01/01/2019; and, WHEREAS, the current year's renewal reflects a 15% increase over 2018; and, further it provides for the City to absorb the proposed 15%increase,estimated cost$38,700 for the year which covers approximately 125 participants. WHEREAS, the City does not wish to pass on the increased premium costs to retirees, but prefers to absorb the increased premium costs as recommended by staff and more fully delineated in Exhibit"A"; and, WHEREAS, Blue Cross and Blue Shield of Texas will take the necessary actions to comply with the Centers for Medicare and Medicaid Services' (CMS) requirements to continue the provisions enacted annually,and do hereby affirm to continue to make changes to its existing health plan policies or products required to comply with the law; and NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY PORT ARTHUR, TEXAS: Section 1. That, the City Council of the City of Port Arthur hereby accepts the contract proposal from Blue Cross and Blue Shield of Texas, Inc.,to renew the Blue Cross P.R. No. 20563 10/30/2018 evd/pd Medicare Advantage PPO and Prescription Drug Plan for its Medicare eligible retirees and/or their Medicare eligible dependent(s) for the 01/01/19 -12/31/18 plan year which includes a renewal rate of 15%over 2018 and direct-bill to participants for the current rate premium ($172.00/month) while the City absorbs 15% ($25.80 per member/month) as is fully delineated in Exhibit"B"; and, Section 2. That, the City Manager is hereby further authorized to execute the necessary contracts and other documents on behalf of the City of Port Arthur subject to the approval of the City Attorney, and to make payment of necessary premium and administrative charges to bind coverage subject to the terms and conditions of the contract for Third Party Administrator (Administrative Services Only) and the Contracts for Insurance attached hereto as required to effectuate said services; and, Section 3. That, a copy of the caption of this Resolution be spread upon the minutes of the City Council. READ, ADOPTED, AND APPROVED this day of AD, 2018, at a Regular Meeting of the City Council of the City of Port Arthur, by the following vote: AYES: Mayor Councilmembers: NOES: Derrick Freeman, Mayor P.R. No. 20563 10/30/18 evd/pd Page 3 of 3 ATTEST: Sherri Bellard, City Secretary APPROVED AS TO FORM: Valecia Tizeno, City Attorney APPROVED FOR ADMINISTRATION E , - 1 h,;(2}__ ___ Elizabet Diaz, Acting Direct of Human Resources Harvey L. Robinson, Interim City Manager APPROVED S TO AILABILITY OF FUNDS: Andrew asquez Finance Director Exhibit "A " 2019 Blue Cross Medicare Advantage P�0 CUSTOM PLAN PBP I'RP Cate M A (Benefit Description) City of Port Arthur P P i Product In-Network Out-of-Network N G Deductible $0 $250 Premium MOOP (Maximum out of Pocket) $1,500 $2,250 Combined OOP Max $2,250 � Inpatient Hospital - Acute $100/dayid 40% coinsurance (days 1-6) Is Inpatient Mental Health Care $100/day 40% coinsurance (days 1-6) $0/day (1-20) Skilled Nursing Facility S 100/day (21-100) 40% coinsurance Cardiac and Pulmonary Rehabilitation Services $20 copay 40% coinsurance Emergency Care $50 copay $50 copay -1, Urgently Needed Services $40 copay 40% coinsurance Partial Hospitalization $30 copay 40% coinsurance r., Home Health Service $0 copay 40% coinsurance (60 visits limit per yr) (60 visits limit per yr) Primary Care Physician Services $30 copay 40% coinsurance r Chiropractic Services $10 copay 40% coinsurance it. Occupational Therapy Services $20 copay 40% coinsurance �;; Physician Specialist Services Excluding Psychiatric $50 copay 40% coinsurance Services (exclude Radiology) Outpatient Mental Healthcare Visit $20 copay 40% coinsurance Podiatry Services $30 copay 40% coinsurance Other Health Care Professional Services $50 copay 40% coinsurance T Outpatient Mental Healthcare Psychiatric Visit $20 copay 40% coinsurance Physical Therapy and Speech Language Pathology Services $20 copay 40% coinsurance aa Lab Services $20 copay 40% coinsurance 8,1 Diagnostic Procedures $60 copay 40% coinsurance st, Therapeutic Radiology $60 copay 40% coinsurance 8b Diagnostic Radiology services / X-Ray $60 copay 40% coinsurance sh Advanced Imaging (MRI, MRA, CT Scan, PET) $50 copay 40% coinsurance 9d Outpatient Hospital Services $100 copay 40% coinsurance rh Ambulatory Surgical Center (ASC) Services $100 copay 40% coinsurance 9c Outpatient Substance Abuse: Individual Therapy $40 copay 40% coinsurance Outpatient Substance Abuse: Group Therapy $40 copay 40% coinsurance ')d OP Blood Services $0 copay $0 copay lad Ambulance Services 20% coinsurance 20% coinsurance lot, Transportation Services Not Covered Not Covered 110 Durable Medical Equipment (DME) 10% coinsurance 40% coinsurance Prosthetics/Medical Supplies 10% coinsurance 40% coinsurance 0%-20% coinsurance (011 Diabetes Supplies and Services for preferred test 40% coinsurance strips; 20%for all other supplies) End-Stage Renal Disease 10% coinsurance 40% coinsurance 13a Acupuncture Not Covered Not Covered 13b Over-the-counter RX Not Covered Not Covered lar. Meal Benefit Not Covered Not Covered 14a Medicare-covered Preventive Services $0 Copay $0 Copay 14h Annual Physical Exam $0 Copay $0 Copay 141 Supplemental Education / Wellness Programs SilverSneakers 14d Kidney Disease Education Services $0 Copay $0 Copay 14e Diabetes Self-Management Training $0 Copay $0 Copay 15 Medicare Part B Rx Drugs 20% coinsurance 40% coinsurance 16a Preventive Dental Not Covered Not Covered 161) Comprehensive Dental 20% Medicare covered 40% Medicare covered $0 copay 40% Medicare Eye Exams Medicare Covered eye covered eye exam exam $0 copay Medicare 40% Medicare Eye Wear covered eye wear covered 25% Medicare Covered; 40% Medicare Hearing Exams $10 copay for 1 routine hearing exam each year Covered Hearing Aids $1,000 combined in-network and out-of-network allowance on hearing aids every 3 years MAPD-PD See PD Tab Travel Benefit For members that are outside of service area for up to 6 months Worldwide Emergency Urgent/Emergent Care - $75 copay; No annual limit Incentives $25 offered at 4 times per year * Deductible is applicable to all cells with a coinsurance. Deductible is not applicable to any cells with a copay. The deductible must be met before a member will pay a coinsurance. The deductible applies to the OOP max. Exhibit " B " City of Port Arthur Renewal 2019 City of Port Arthur Medicare Advantage program for the 1/1/19 renewal. Those options are- Plan Rates Change Benefit Changes 2017 Sold $ 162.30 2018 Sold $ 172.00 6.0% No change from 2018-$0/250 Ded;$1500/2250 MOOP 2019 Original $ 197.80 15.0% (INN/ONN) 2019 Alt 1 $ 183.60 6.7% +$250/500 Ded;$2000/3000 MOOP (INN/ONN) 2019 Alt 2 $ 171.30 -0.4% +$500/1000 Ded;$2000/3000 MOOP(INN/ONN) 2019 Alt 3 $ 171.40 -0.3% +$250/500 Ded; $3500/5000 MOOP (INN/ONN) 2019 Alt 4 $ 157.70 -8.3% +$500/1000 Ded;$3500/5000 MOOP(INN/ONN) +$250/500 Ded; $2000/3000 MOOP(INN/ONN);Rx MOOP 2019 Alt 5 $ 183.40 6.6% $2500 +$500/1000 Ded;$2000/3000 MOOP (INN/ONN); Rx MOOP 2019 Alt 6 $ 171.10 -0.5% $2500 I asked for some claim information regarding the renewal as well. I will lay that out below, but I want to include some basics. The first thing they saw when looking at overall claim activity is that Year-over-Year claim activity was up 68.1%over last year- same time period. The drivers of this are - • Inpatient Facility Charges - + 68.3%-$394.39 PMPM • SNF -+665.9% - $42.10 PMPM • OP Facility (Dialysis) -+ 150.7%-$59.29 PMPM • Part B Rx-+ 2427.8%-$109.39 PMPM • DME -+311.4%- $29.07 PMPM These percentages are on a Per Member Per Month (PMPM) basis. These were the big drivers in total dollars and percentages.