cover
TO: Mayor Mayor Richard C. Irvin
FROM: Alisia Lewis, Chief Human Resources Officer
DATE: 8/12/2024
SUBJECT:
A Resolution Establishing Health and Dental Insurance Monthly Rates for Pre Medicare-Retirees Effective January 1, 2025, through December 31, 2025
PURPOSE:
To establish the 2025 health and dental insurance monthly rates for Pre Medicare retirees.
BACKGROUND:
The Pre Medicare retirees is a self-funded 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 Medicare retirees to cover their necessary liabilities.
DISCUSSION:
The HMO, PPO, and 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.
Renewal is a 3% increase for the Pre Medicare retirees.
The Dental Plan has not increased the annual benefit maximum of $1,200 for over 10 years which inflation has reduced the overall value of this benefit. Thus, the recommendation is to increase the annual benefit maximum to $1,750 and add coverage for dental implants. The city's funding rates for dental will increase by 25% which will be funding with the projected savings from BCBSIL.
Retiree dental premiums and active employee dental rates are the same and there is no increase for 2025.
2024 and 2025 Pre Medicare retiree contribution sheets are attached.
IMPACT STATEMENT:
No impact.
RECOMMENDATIONS:
Place on the Finance Committee calendar for approval to City Council.
cc: Finance Committe...
Click here for full text