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CITY OF HOMER COUNCIL MEETING August 4, 2014 Presented by: Jeff Paxton Principal & Senior Consultant
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MERCER City of Homer Discussion Topics Benefit Plan Financial Performance Effect of January 2014 Plan Changes ACA Excise Tax Benefit Plan Benchmark Comparison Fully Insured Marketing Status
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MERCER Benefit Plan Financial Performance
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MERCER Benefit Plan Financial Performance
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MERCER Benefit Plan Financial Performance Expenses through June Expenses through May
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MERCER Benefit Plan Financial Performance
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MERCER Effect of January 2014 Plan Changes Enrollment Migration Analysis As of December 2013As of May 2014 Change in Distribution Total Employee Only23Employee Only31 8 EE + Spouse24EE + Spouse16 (8) EE + Child2 2 0 EE + Children2 6 4 EE + Sp + Child13EE + Sp + Child7 (6) EE + Sp + Children33EE + Sp + Children22 (11) Total97Total84 (13)
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MERCER Effect of January 2014 Plan Changes FINANCIAL CHANGES through June 2014 7.3% reduction in Stop Loss premium payments. 16.6% reduction in Health Plan administration costs. 3.4% increase in total fixed costs (employees waiving coverage). 16.7% reduction in claim costs. 12.7% reduction in total expenses. 4.7% increase cost per employee per month.
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MERCER 2018 ACA Excise Tax
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2013 NATIONAL SURVEY OF EMPLOYER-SPONSORED HEALTH PLANS CITY OF HOMER August 2014
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MERCER About the Survey Employers Number of participants City of Homer1 City <500106 50-199 Employees315 National All2842 The employer groups shown in this presentation are:
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MERCER Demographics City of HomerCity <500 50-199 EmployeesNational All Average employee age474341 % of female employees33%31%47%43%
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MERCER *Total health cost includes medical, dental, Rx and specialty benefits Average total health benefit cost* per employee
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MERCER Employee contribution for individual coverage Average monthly contribution ($) City of HomerCity <500 50-199 EmployeesNational All PPO / POS Buy-up - $89.53 Core - $79.99 $120$124$143 HMO$0$111$151$169 HSA-eligible CDHP$0$43$72$76 HRA-based CDHP$0$45ID Dental$5.01$22$23$30
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MERCER Employee contribution for individual coverage Average contribution as a % of premium City of HomerCity <500 50-199 EmployeesNational All PPO / POS Buy-up - 11% Core - 12% 14%24%30% HMO0%23%32%33% HSA-eligible CDHP0%25%21%23% HRA-based CDHP0%8%ID Dental15%55%64%68%
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MERCER Employee contribution for family coverage* Average monthly contribution ($) *Family coverage is defined as coverage for employee, spouse and two children City of HomerCity <500 50-199 EmployeesNational All PPO / POS Buy-up - $509.43 Core - $240.00 $340$545$540 HMO$0$352$549$584 HSA-eligible CDHP$0$171$318$422 HRA-based CDHP$0$217ID Dental$25$58$68$72
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MERCER Employee contribution for family coverage* Average contribution as a % of premium *Family coverage is defined as coverage for employee, spouse and two children City of HomerCity <500 50-199 EmployeesNational All PPO / POS Buy-up - 18% Core - 10% 33%52%56% HMO0%28%48%49% HSA-eligible CDHP0%19%34%42% HRA-based CDHP0%19%ID Dental21%60%70%73%
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MERCER City of Homer 2013 City of Homer 2014City <500 50-199 EmployeesNational All Average % of employees waiving own coverage 0%20%8%20%22% % of employers offering incentive to waive coverage NoYes42%11% Coverage waivers
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MERCER City of Homer 2013 City of Homer 2014City <500 50-199 EmployeesNational All % of employees electing dependent coverage 73%62%58%45%53% Make spouses ineligible for coverage if other coverage is available No 6%9%4% Surcharge applies for spouses with other coverage available NoYes0%2%1% Dependent coverage
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MERCER In-networkCity of HomerCity <500 50-199 EmployeesNational All Deductible required (% of employers) Yes87%93%91% Median individual deductible amount Buy-up - $400 Core - $1,500 $750$1,000$1,500 Median family deductible amount Buy-up - $1,200 Core - $4,500 $1,500$3,000 PPO / POS deductibles
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MERCER City of HomerCity <500 50-199 EmployeesNational All Median copay amount Buy-up - $30 Core - $35 $20$25 PPO / POS in-network primary care physician (PCP) visit cost-sharing PPO / POS emergency room visit cost-sharing City of HomerCity <500 50-199 EmployeesNational All Median emergency room copay amount Buy-up - $100 Core - $150 $100$150$100
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MERCER Individual OOP maximumCity of HomerCity <500 50-199 EmployeesNational All Median for in-network services Buy-up - $2,400 Core - $4,500 $2,000$3,000 PPO / POS out-of-pocket (OOP) maximums* Family OOP maximum Median for in-network services Buy-up - $7,200 Core - $12,500 $4,000$6,000 *Includes deductible
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MERCER RetailCity of HomerCity <500 50-199 EmployeesNational All Generic Buy-up - $10 Core -$25 $9$12 Brand-name formulary Buy-up - $20 Core -$50 $24$33$32 Brand-name non-formulary Buy-up - $30 Core -$75 $47$56$54 Copayments in prescription drug plans Average copayment among employers with three payment levels
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MERCER Average cost of dental coverage, per employee
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MERCER 2015 Fully Insured Marketing Status
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