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TO: Mayor Richard C. Irvin
FROM: Alisia Lewis, Chief Human Resources Officer
DATE: 8/26/2024
SUBJECT:
A Resolution Authorizing Blue Cross Blue Shield Blue of Illinois (BCBSIL) for Group Health Care Services and Rates for the period of January 1, 2025, through December 31, 2025.
PURPOSE:
To affirm the 2025 HMO, PPO and Value HSA(HDHP) schedule of benefits and establish the 2025 insurance premium rates of the City's HMO, PPO and Value HSA(HDHP) medical insurance.
BACKGROUND:
The City of Aurora provides a fully insured HMO for active employees through Blue Cross Blue Shield of Illinois(BSBSIL). There are two self-funded plans for active employees and Pre-65 retirees through CIGNA. CIGNA’s offerings include a Traditional Plan and a High Deductible Health Plan. January 1, 2018, the City carved out the Post-65 Medicare retirees to a Medicare Advantage Program and set separate funding rates for the active employees and the Pre-65 retirees in order to cover their necessary liabilities under the CIGNA plan.
DISCUSSION:
The HMO, PPO, and Value HAS(HDHP) offerings have remained stable since January 1, 2016. However, the City’s plan on a Per Employee/Retiree Per Year cost is significantly higher than the Mercer Government Benchmark.
Year HMO Mercer* CIGNA Mercer*
2020 18,312 15,862 20,544 14,000
2021 18,655 16,258 22,452 14,665
2022 17,691 16,665 22,500 15,244
2023 18,441 15,274 21,780 16,457
2024 19,548 15,656 23,016 16,868
2025 19,548 16,470 23,706 17,745
*Mercer’s 2024 and 2025 costs are projections assuming a 5.2% increase on HMO and 5.2% on PPO.
The 2025 renewal rate is 3% for PPO and Value HSA(HDHP). The 2025 renewal rate is 0% for HMO.
The City recommends approving the rates for the HMO, PPO and Value HSA(HDHP) health plan for 2025.
Attached are the 2024 and 2025 rates for comparison.
IMPACT STATEMENT:
No impact.
RECOMMENDATIONS:
Place on the Finance Committee calendar for approval to City Council.
cc: Finance Committee
CITY OF AURORA, ILLINOIS
RESOLUTION NO. _________
DATE OF PASSAGE ________________
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A Resolution Authorizing Blue Cross Blue Shield Blue of Illinois (BCBSIL) for Group Health Care Services and Rates for the period of January 1, 2025, through December 31, 2025.
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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, Blue Cross Blue Shield Blue of Illinois (BCBSIL) is a federally qualified Health Maintenance Organization with medical centers located in Aurora and the surrounding area; and:
WHEREAS, the 2025 proposed City budget will provide funding for this item in employee health account number 602-0000-410.28-05.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Aurora, Illinois, as follows: is hereby authorized to execute the BCBS contract for 2025. The rates attached as Exhibit "A" represents a 3% increase for PPO and Value HSA(HDHP) and a 0% increase for HMO.