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TO: Mayor Thomas J. Weisner
FROM: Alisia Lewis, Director of Human Resources
DATE: October 9, 2014
SUBJECT:
A Resolution Authorizing Agreement for Administrative Services with Allied Benefit Systems, Inc. for PPO Group Health Plan Administration for Period January 1, 2015 through December 31, 2015
PURPOSE:
To establish the 2015 rates for third-party administrative services of Allied Benefit Systems, Inc. for the City's PPO Health Insurance Plan.
BACKGROUND:
Allied Benefit Systems has been the City's third -party administrator for the City's PPO health plan, Section 125 Flex Plan, Medicare Part D and COBRA administration for PPO participant employees, retirees and their dependents since 2006.
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DISCUSSION:
Allied has been instrumental in designing, implementing and administering the city's PPO health plans. Allied will also be the administrator for a new high deductible health plan (HDHP) that includes an optional health saving account (HSA). The HDHP requires that the employee meet a higher deductible, $2,500, and in return they will pay a significantly lower premium. If the employee opts for the HDHP, they have the option of enrolling in an HSA that allows a pre-tax dollars benefit use for health care expenses. Allied has continued to meet its contractual performance criteria which measures their claim turnaround time, payment and financial accuracy and coding/clerical accuracy which has resulted in no financial penalties imposed to date.
After coming off a two year agreement of 2% for 2012 and 1% for 2013, and a 1.5% increase for 2014, Allied is proposing no increase for 2015. Human Resources is seeking a one year agreement for continuity and consistency as we continue to negotiate implementation of Plan "C" to all employee groups.
IMPACT STATEMENT:
RECOMMENDATIONS:
Place on the Finance Committee agenda for approval to City Council.
cc: Alderman O'Connor, Chairman
Alderman Mervine
Alderman Bohman
Alderman Peters, Alternate
CITY OF AURORA, ILLINOIS
RESOLUTION NO. _________
DATE OF PASSAGE ________________
title
A Resolution Authorizing Agreement for Administrative Services with Allied Benefit Systems, Inc. For PPO Group Health Plan Administration for Period January 1, 2015 Through December 31, 2015.
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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, it is in the best interests of the City of Aurora to enter into a contractual relationship by and between the City of Aurora and Allied Benefit Systems, Inc., for administration of PPO group health plan administration for City employees and retirees; and:
WHEREAS, it is desirable to have Allied Benefit Systems, Inc. administer Health, Section 125 Flexible spending accounts, COBRA, HIPAA, Medicare Part D, HDHP and Preferred Provider Organization enrollment, statements as needed, and
WHEREAS, the 2015 proposed City budget provides $599,171.00 for this item in employee health account numbers 602-0000-410.28-02; 602-0000-410.28-04; 602-0000-410.28-21; and retiree health account numbers 704-0000-410.28-52; 704-0000-410.28-54; 704-0000-410.28-62; 704-0000-410.28-64; 704- 0000-410.28-72 and 704-0000-410.28-74.)
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Aurora, Illinois, as follows:
I. That the Mayor is hereby authorized to enter into an administration contract with Allied Benefits Systems, Inc. based on the attached proposal.
II.That said contract is for the period January 1, 2015 through December 31, 2015.
PASSED AND APPROVED on ______________.
AYES ____ NAYS ____ NOT VOTING ____ ABSENT ____
____________________________ __________________________
Alderman Bohman, Ward 1 Alderman Garza, Ward 2
____________________________ __________________________
Alderman Mesiacos, Ward 3 Alderman Donnell, Ward 4
____________________________ __________________________
Alderman Peters, Ward 5 Alderman Saville, Ward 6
____________________________ __________________________
Alderman Hart-Burns, Ward 7 Alderman Mervine, Ward 8
____________________________ __________________________
Alderman Bugg, Ward 9 Alderman Johnson, Ward 10
____________________________ __________________________
Alderman Irvin, At Large Alderman O'Connor, At Large
ATTEST:
____________________________ __________________________
City Clerk Mayor
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