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TO: Mayor John Laesch
FROM: Michele Clark, Chief Human Resource Officer
DATE: August 27, 2026
SUBJECT:
A Resolution Authorizing an Agreement with Humana to administer a Medicare Advantage Plan for Medicare Eligible Retirees for the Period of January 1, 2027, through December 31, 2027
PURPOSE:
To authorize a renewal agreement with Humana to administer a Medicare Advantage (MA) Plan for Medicare eligible retirees.
BACKGROUND:
Effective January 1, 2022, the City of Aurora moved its Group Medicare plan coverage for eligible retirees from the Aetna Medicare Advantage plan over to Humana’s Medicare Advantage Plan. Below is the rate history since 2020:
2020:$343.35 Per Retiree Per Month
2021:$314.84 Per Retiree Per Month
2022:$178.55 Per Retiree Per Month
2023:$199.98 Per Retiree Per Month
2024:$214.86 Per Retiree Per Month
2025:$249.66 Per-Retiree Per Month
2026:$276.67 Per-Retiree Per Month
2027: $234.21 Per-Retiree Per Month (Proposed)
DISCUSSION:
Humana’s proposed 2027 renewal rate is $234.21 per retiree per month, which is a 15.35% decrease from the 2026 rate. The decrease is primarily due to consolidating the City’s plan structure (Police, Fire, and IMRF) to simplify administration and separating the Medical and Prescription Drug (Rx) coverage under the Medicare Advantage plan. These changes will have no impact on members or their benefits.
The deductible will remain at $500, with no plan or benefit changes, ensuring members will have the same plan experience.
Our broker solicited proposals for Group Medicare plan coverage from four providers: Humana, Aetna, United Healthcare, and Blue Cross Blue Shield of Illinois (BCBSIL). Aetna's proposal was 59% higher than the current Humana premium. United Healthcare and BCBSIL declined to submit proposals as those providers did not believe that their proposals would be competitive.
While post-65 retiree contribution rates vary based upon the retirees' employee group at the time of retirement, their contribution rates are frozen at the applicable contribution rate when they turn age 65.
IMPACT STATEMENT:
NA
RECOMMENDATIONS:
Place on the Finance Committee calendar for approval to the City Council.
cc: Finance Committee
CITY OF AURORA, ILLINOIS
RESOLUTION NO. _________
DATE OF PASSAGE ________________
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A Resolution authorizing an Agreement with Humana to Administer a Medicare Advantage Plan for Medicare Eligible Retirees for the Period of January 1, 2027, through December 31, 2027.
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WHEREAS, the City of Aurora has a population of more than 25,000 persons and is, therefore, a home rule unit under subsection (a) of Section 6 of Article VII of the Illinois Constitution of 1970; and
WHEREAS, subject to said Section, a home rule unit may exercise any power and perform any function pertaining to its government and affairs for the protection of the public health, safety, morals, and welfare; and
WHEREAS, the City has received proposals for Group Medicare Advantage plans for eligible retirees for the 2027 plan year and has determined it is in the best interests of the City of Aurora to enter into a Group Medicare Renewal Agreement (the "Agreement"), by and between the City of Aurora and Humana, a copy of which is included in Exhibit A attached hereto and incorporated herein.)
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Aurora, Illinois, as follows: that the Mayor and/or the City's Chief Human Resource Officer is hereby authorized to execute the Group Medicare Renewal Agreement ("Agreement") with Humana, a copy of which is included in Exhibit A attached hereto and made a part hereof, for the period of January 1, 2027, through December 31, 2027, with such changes to the Agreement as may be approved by the City's Corporation Counsel as to form.