HomeMy WebLinkAbout05.L- Human Resources 5.,
RESOLUTION (ID # 4591) DOC ID: 4591 A
CITY OF SAN BERNARDINO — REQUEST FOR COUNCIL ACTION
Personnel
From: Helen Tran M/CC Meeting Date: 09/06/2016
Prepared by: Helen Tran, (909) 384-5161
Dept: Human Resources Ward(s): All
Subject:
Resolution of the Mayor and Common Council of the City of San Bernardino Approving
Employer Paid Health Benefit Contributions for Benefit Plan Year 2017 and Election of
the Mayor and Common Council to Receive the Same Benefit Plan as the Management
/ Confidential Bargaining Unit. (#4591)
Current Business Registration Certificate: Not Applicable
Financial Impact:
The Employer Paid Contribution is projected to have an overall increase of$164,370
with $131.496 coming from the General Fund and $32,874 from other Funds. $131,496
includes vacancies. City Contributions for the SBPOA and PMA are determined by the
provisions in their respective MOUs. No supplemental appropriation is required since
sufficient budget resources are available.
Motion: Adopt the Resolution.
Synopsis of Previous Council Action:
On October 19, 2009, the Mayor and Common Council adopted Resolution No. 2009-
339, authorizing an annual stipend payable to employees who waive health care
benefits to commence calendar year 2010.
On January 28, 2013, the Mayor and Common Council adopted Resolution No. 2013-
21, authorizing modifications to the retiree health insurance payments for Police Safety
and Police Management employees in accordance with the City's Pendency Plan, Item
#8, adopted by the Mayor and Common Council on November 26, 2012 by Resolution
2012-27.
On October 20, 2014, the Mayor and Common Council adopted Resolution No. 2014-
369, approving Employer Paid Health Benefit Contributions for Benefit Plan Year 2015.
Background:
The City's negotiating team and the City's Health Benefit Broker, Alliant, has met with
the Health Benefits Committee, which includes representatives from the
Management/Confidential Group, Middle Management Unit, General Unit, Police
Management, and Police Safety regarding the health benefit renewals, health benefit
contributions and other related health benefits.
Overall plan renewal summary is as follows:
Updated: 8/30/2016 by Georgeann "Gigi" Hanna A Packet Pg. 295
4591
• Medical
• Kaiser HMO's renewal is 1.78%
• Aetna had an initial renewal of 16.7% for the Active employees. Alliant
was able to negotiate to 9.0%
• Aetna had an initial renewal of 20.0% for the early retirees and non-
Medicare employees. Alliant was able to negotiate to 17.0%
• Dental
• Delta Dental DeltaCare HMO's renewal is 4.5%
• Delta Dental CSAC EIA DPPO renewal is 2.5%
■ Stabilization funds may be used to offset the renewal
■ Keep the current program and offer a Buy Up option
■ Buy Up option has an enhanced calendar year maximum of
$2,000
• Vision
■ EyeMed is in a rate guarantee through 12/31/2018
■ Employee feedback was to have a Vision program with enhanced
benefits
■ Keep the current program and offer a Buy Up option
■ Buy Up options includes enhanced quality lenses
■ Larger frame and contact allowance
• Life & Disability
• Rates are under guarantee until 12/31/2017
Effective January 1, 2017 Benefit Plan Year, it is recommended that the City take the
following actions:
Employer contributions for insurance benefits available for purchase by employees
include medical, dental, vision, life and accidental death and dismemberment, as made
available through the City. The amount of the Employer contribution is based on the
selection of the "Medical" enrollment category. If an employee elects "employee only"
medical coverage, then the "employee only" allowance is given to the employee. Any
contributions not utilized by an employee shall revert to the City unless otherwise
provided for in an agreement with a bargaining unit. All health benefit contributions as
set forth below are compliant with the Affordable Care Act (ACA).
Updated: 8/30/2016 by Georgeann "Gigi" Hanna A Packet Pg. 296
4591
Employee Employee 1 Employee +
Bargaining Unit Only One i Family
Management/Confidential $ 990.00 $ 1,1 15.00 !$ 1 ,115.00
Middle Management $ 530.00 $ 605.00 $ 805.00
General__ 490.00 $ 655.00 $ 655.00
Police Safety* $ 55 38.29 $ 910.96 $ 1,08U.64
Police Management* $ 954.60 $ 1,061.33 $ 1,18 .42
*City Contributions for the Police Safety (SBPOA) and Police Management (PMA) are
determined by the provisions in their respective MOUs.
MEDICAL RENEWAL HISTORY:
2017. Kaiser 1.78% 1.78% Foderal r uiatJ0M
su oer fee
Aetna PPO 16-7% 9% for 2011,date tot
par*11 acid perch 7.0% 8,0%
Q Aetna HMO 167% 9% for 2017,has not been
finaltzod Remsurar?oe
arrtnW4n f
2016 Kaiser 5.05% 5.05% 14%
Aetna PPO 115% 8.9% 35% 7.0% 8.0%
Aetna HMO 115% &9% 35%
2015 Kaiser 147% -4,1% 127%
Anthem PPO 115% 0.6%(Aetna) 3.83%
10.0% 90%
Anthem HMO 7.3% -17 5%(Aetna) 3.83%
2014 Kaiser 11.0% 8.9% 1.4%
Anthem PPO 13.5% 9.0% 10% 10.0% 10-0%
Anthem HMO 13.5% 9.0% 3.7%
OBJECTIVES AND GOALS IN THE LAST 3 PLAN YEARS (2014, 2015, 2016 :
Year 1 (2014) - Objectives
• Transition to new BenAdmin vendor effective 1/1/14 N"
• Transitioned to new Life and Disability Insurance vendor to correct contract
issues and outsource FMLA ti'
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4591
■ Begin ACA compliance and preparation w
■ Implement call center for employees and retirees
Year 2 (2015) - Objectives
• Focus on cost containment '\/
• Evaluate Risk Profile and Contribution Strategy v
• Retiree Health Exchange v'
■ Evaluate UHC Retiree Exchange as a way to 1) save retirees
money and 2) reduce HR staff work v'
• Continued ACA compliance and preparation '
• Health & Productivity - initial discussions
Year 3 (2016) - Objectives
• Cost Containment to maintain increases below Medical Inflation .4
• Benefit Program Enhancements (without increasing cost to City)
■ Voluntary Benefits
• Continued ACA compliance
■ Preparation for Reporting - in house or vendor
Year 4 (2017) - Objectives
■ Evaluate Progress; recalibrate issues, needs, goals and set strategy for next
three years
■ Health and Productivity - Discuss Program Options
■ Preventive Care
■ Disability
■ Absenteeism/Health & Productivity
■ Increase awareness and utilization of Alliant and Carrier mobile
applications
■ Telemedicine services
ACCOMPLISHMENTS:
• Un-blended actives from the early retirees, resulted in $1.3 million in employer
savings
• Added a HMO Narrow Network, providing the employees a 17% savings option
• Removed Early Retiree and Medicare Eligible Allowances, resulted in $569,856
employer savings
• Carved out retirees 65+ plus Medicare eligible to an individual Medicare
supplemental platform, yielding an instate HMO savings of$208K
• Voluntary benefits used to expand City of San Bernardino's benefit platform
CITY ATTORNEY REVIEW:
Generally, the compensation paid to officers and employees of charter cities is a
municipal affair subject to the city charter. However, section 53208.5 of the California
Government Code ("Code") clearly establishes that providing health benefits to city
council members is a matter of statewide concern. Section 36516 of the Code holds that
Updated: 8/30/2016 by Georgeann "Gigi" Hanna A I Packet Pg.298
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4591
any amounts paid by a city for retirement, health and welfare, and federal social security
benefits of council members are not included for purposes of determining salary under
the Code. The same section requires any benefits provided to city council members
must be the same benefits that are available and paid by the city for its employees.
Section 53202.3 requires that any plan, policy or other document used to effectuate
retirement and health and welfare benefits of council members must provide benefits for
a "large number of employees." Finally, section 53208.5 of the Code requires the health
and welfare benefits of any member of a legislative body of any city, including a charter
t city shall be no greater than that received by non-safety employees of that public
agency. In the case of agencies with different benefit structures, the benefits of
members of the legislative body shall not be greater than the most generous schedule
of benefits being received by any category of non-safety employees.
By adopting the attached resolution, the Mayor and Common Council will formally opt to
receive the same benefits available to members of the Management Confidential
bargaining unit, thereby satisfying the requirements of the aforementioned sections of
the Government Code. The requirement that the Mayor and Common Council members
who elect to receive the health insurance stipend must opt to have that stipend
contributed to the City's established deferred compensation plan is in accordance with
the opinion of the California Attorney General, which holds that cash payments are not
considered health and welfare benefits.
City Attorney Review:
Supporting Documents:
RESO.EMPLOYER PAID HEALTH CONTRIBUTIONS 2017 (DOC)
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1 RESOLUTION NO.
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3 RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN
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BERNARDINO APPROVING EMPLOYER PAID HEALTH BENEFIT CONTRIBUTIONS m
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FOR BENEFIT PLAN YEAR 2017 AND ELECTION OF THE MAYOR AND COMMON y
5 COUNCIL TO RECEIVE THE SAME BENEFIT PLAN AS THE MANAGEMENT /
6 CONFIDENTIAL BARGAINING UNIT.
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8 WHEREAS, on October 19, 2009, the Mayor and Common Council adopted
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Resolution No. 2009-339, authorizing an annual stipend payable to employees who
waive health care benefits to commence calendar year 2010; and,
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WHEREAS, on July 18, 2012, the Mayor and Common Council of the City of San
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Bernardino declared a fiscal emergency; and,
12 WHEREAS, on August 1, 2012, the City filed an emergency voluntary petition for a
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13 relief under Chapter 9 of the Bankruptcy Code in the United Stated Bankruptcy Court for w
14 the Central District of California, Riverside Division; and, C)
15 WHEREAS, on November 26, 2012, the Mayor and Common Council adopted the
Pendency Plan, Resolution 2012-278; and, N
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WHEREAS, on May 18, 2015, the Mayor and Common Council adopted o
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Resolution No. 2015-103 authorizing the implementation of the City's fiscal recovery plan, m
18 the filing of the Chapter 9 Plan of Adjustment and Disclosure Statement and the filing of Z
19 related documents; and,
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20 WHEREAS, on May 29, 2015, the City filed its Plan of Adjustment and Disclosure
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21 Statement; on November 25, 2015, the City filed its First Amended Plan of Adjustment =
22 and Disclosure Statement; on March 30, 2016, the Second Amended Plan of Adjustment a
and Disclosure Statement was filed on May 29, 2016; and, the Third Amended Plan of w
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Adjustment (dated July 29, 2016) and an approved Disclosure Statement was filed; and, o
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WHEREAS, on June 27, 2016, the Mayor and the Common Council adopted the w
25 City's 2016-2017 Budget; and, c°„
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26 WHEREAS, adoption of the Employer Paid Health Benefit Contribution schedule
27 for Plan Year 2017 is necessary to implement the budget allocations for the City's health
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28 benefit contributions provided in the FY 2016-2017 adopted budget; and, r
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1 Packet Pg. 300
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1 WHEREAS, on July 19, 2016, the City's negotiating team has met with the Joint r
2 Labor Management Health Benefits Committee representing all bargaining groups: [San
3 Bernardino Confidential/Management Association (SBCMA), Middle Management
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Employees' Association, Teamsters Local 1932 (MMA), General Unit, International Union m
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of Operating Engineers (IUOE), San Bernardino Police Management Association y
5 (SBPMA), San Bernardino Police Officers' Association (SBPOA)] and provided 2
6 proposals, financial and other information regarding the health plans and optional
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7 benefits; and,
g WHEREAS, the City and SBCMA, MMA, IUOE, SBPOA, and SBPMA c
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9 representatives have reached an agreement on the City or Employer contributions
towards the purchase of City-sponsored health care premiums.
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WHEREAS, the Mayor and Common Council may receive the same benefits that 2
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the City provides to a large number of its employees, as long as those benefits are no
12 greater than the most generous schedule of benefits provided to any category of non- —°Q
13 safety employees. w
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NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND COMMON
COUNCIL OF THE CITY OF SAN BERNARDINO AS FOLLOWS: N
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SECTION 1: The following benefit changes for all bargaining groups are adopted m
18 for implementation effective January 1, 2017: z
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20 1. Health Benefit Contributions: Employer contributions for insurance benefits J
available for purchase by employees include medical, dental, vision, life and w
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accidental death and dismemberment, as made available through the City. The o
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amount of the Employer contribution is based on the selection of the "Medical" 0-
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23 enrollment category. If an employee elects "employee only" medical coverage, o
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24 then the "employee only" allowance is given to the employee. Any contributions
25 not utilized by an employee shall revert to the City unless otherwise provided for in 0
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26 an agreement with a bargaining unit. All health benefit contributions as set forth u
below are compliant with the Affordable Care Act (ACA).
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28 Bargaining Unit Employee Employee+ 1 Employee +
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2 Packet Pg. 301
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1 Only Family
2 Management/Confidential $ 990.00 $ 1,115.00 $ 1,115.00 a
3 Middle Management $ 530.00 $ 805.00 $ 805.00
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4 General $ 490.00 $ 655.00 $ 655.00
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Police Safety* $ 538.29 $ 910.96 $ 1,080.64
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Police Management* $ 954.60 $ 1,001.33 $ 1,187.42
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*City Contributions for the SBPOA and PMA are determined by the provisions in 5
their respective MOUs. -�
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9 2. For Plan Year 2018 and forward, the City will continue to meet with the Joint Labor
10 Management Health Benefits Committee to review health plan options and may =
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11 adjust the Employer contributions toward medical, dental, vision, and other health a
benefits. Plan designs and contributions shall be effective January 1St annually.
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The City shall reserve all rights to modify medical plans and the amount of a
13 contributions paid by the City. With respect to the SBCMA, MMA, and the IUOE, L.U.
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14 the City will include health plan options and City contributions as part of the
15 pending labor negotiations.
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17 3. Health Insurance Waiver Stipend: Effective with health benefit plan year 2017, the o
City of San Bernardino agrees to provide full-time eligible employees who waive m
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health benefits an annual "Health Insurance Waiver Stipend" of $2,500 each z
19 December 15th 0
. The first payment would be December 15th of 2017. Such
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20 payment is not considered compensation for purposes of CalPERS and is subject a
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21 to state and federal taxes. Employees electing to receive a "Health Insurance x
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22 Waiver Stipend" must meet certain requirements, including without limitation, must a
23 be a regular full-time and paid status for a minimum of 21 hours per week; must r
provide satisfactory written proof of comparable medical insurance coverage; and, a
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must waive all medical, dental, vision, supplemental life, and supplemental AD&D w
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benefits. The Health Insurance Waiver Stipend Policy and Waiver Form are w
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available from the City's Human Resources Department.
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3 Packet Pg. 302
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1 4. Health Benefit Contributions for the Mayor and Common Council: In addition to >b
2 retirement benefits under CalPERS, the Mayor and Common Council Members a
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3 are eligible to receive the same health benefits that are provided to City
employees and the City's contributions to such benefits shall be the same as is m
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available to SBCMA members. In the event that the Mayor and/or Common N
5 Council members elect to receive the health insurance stipend as described in 2
6 paragraph 3 herein, the stipend must be contributed to the City's established
7 deferred compensation plan. ci
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8 5. Retirement Medical Benefits: The City and the Official Committee of Retired ID
9 Employees of the City of San Bernardino created as a result of the City's filing of
Chapter 9 Bankruptcy have entered into a Settlement Agreement, dated as of May
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19, 2015 (a copy of which can be found on the docket for the City's Chapter 9
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Bankruptcy case) setting forth the City's obligations for contributions to the retirees
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12 electing to participate in the City's health plan options for Plan Year 2017. a
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I RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN i
2 BERNARDINO APPROVING EMPLOYER PAID HEALTH BENEFIT CONTRIBUTIONS a
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3 FOR BENEFIT PLAN YEAR 2017 AND ELECTION OF THE MAYOR AND COMMON
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COUNCIL TO RECEIVE THE SAME BENEFIT PLAN AS THE MANAGEMENT / m
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CONFIDENTIAL BARGAINING UNIT. y
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5 1 HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor and 2
6 Common Council of the City of San Bernardino at a meeting
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7 thereof, held on the day of , 2016, by the following vote, to wit: c°�
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Council Members: AYES NAYS ABSTAIN ABSENT °0
MARQUEZ
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BARRIOS °
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11 VALDIVIA
12 SHORETT a
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13 NICKEL "'
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14 RICHARD Ln
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MULVIHILL
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Georgeann Hanna, City Clerk m
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19 The foregoing resolution is hereby approved this day of , 2016. o
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R. Carey Davis, Mayor w
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City of San Bernardino 0
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Approved as to form: w
25 GARY D. SAENZ, w
26 City Attorney
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28 By:
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5 Packet Pg. 304