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TO: Mayor Richard C. Irvin
FROM: Alisia Lewis, Director of Human Resources
DATE: August 21, 2019
SUBJECT:
A Resolution Establishing Cigna Open Access Plan (OAP) and Value HSA(HDHP) Health Plan and Rates Effective January 1, 2020 through December 31, 2020.
PURPOSE:
To affirm the 2020 OAP and Value HSA(HDHP) schedule of benefits and establish the 2020 insurance premium rates of the City's OAP and Value HSA(HDHP) medical insurance.
BACKGROUND:
Each year the City establishes base premium rates for its self-insured OAP and HDHP plans. Cigna has been the City's health insurance administrator for the OAP and HDHP plans since 2016. The City will continue to offer biometric health screenings for 2020.
The 2019 premium rates were decreased by 11.7% for groups that agreed to a higher plan design. Premium rates were increased by 3.2% for groups that did not agree to a higher plan design.
DISCUSSION:
As a self-funded plan, the City is subject to changing cost due to excess or catastrophic medical claims, Rx cost and limitations to making further plan design changes which is subject to ongoing union negotiations. Currently all groups are on the same OAP plan design and no changes will occur for 2020.
Going forward, the HDHP plan will be referred to as the Value HSA plan. This has always been the most cost effective plan to the employees and the city.
Driven by primarily increasing Rx cost, the OAP premium rates will increase by 6%. For the 5th consecutive year, the Value HSA(HDHP) premiums will not increase.
Attached are the 2019 and 2020 rates for comparison.
IMPACT STATEMENT:
No impact.
RECOMMENDATIONS:
Placed on the Finance Committee calendar for approval by Finance Committee.
cc: Finance Committee
CITY OF AURORA, ILLINOIS
RESOLUTION NO. _________
DATE OF PASSAGE ________________
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A Resolution Establishing OAP and Value HSA(HDHP) Health Insurance Plans and Rates Effective January 1, 2020 through December 31, 2020.
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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 has been determined, on the basis of past actual experience and projected loss experience, that the OAP and Value HSA(HDHP) rates set forth herein represent equitable and reasonable amounts for eligible participants in the plans.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Aurora, Illinois, as follows: the attached 2020 City of Aurora OAP and Value HSA(HDHP) rates of all plans are hereby adopted as attached hereto.