HomeMy WebLinkAboutFS 2013-10-08 Item 2B - Resolution - Council BenefitsTO:
City of Tukwila
Jim Haggerton, Mayor
INFORMATIONAL MEMORANDUM
Mayor Haggerton
Finance & Safety Committee
FROM: Stephanie Brown, Human Resources Director
DATE: October 2, 2013
SUBJECT: Councilmember Benefits
ISSUE
Under the Patient Protection and Affordable Care Act (PPACA), the City's health expense
reimbursement to Councilmembers is considered a stand -alone health plan. The
reimbursement arrangement as it currently exists will be prohibited by PPACA after January 1,
2014.
BACKGROUND
Since 2001, a fringe benefit has been provided to Councilmembers to reimburse them for
eligible medical, dental, vision, and health insurance premiums. The current benefit amount is
$3,400 per Councilmember, per year. Reimbursement claims are processed by the Finance
Department staff. In lieu of receiving the reimbursement benefit, Councilmembers have the
choice of enrolling in the City's Self- Insured Medical /Dental plan. Any expenses incurred by
Councilmembers' dependents are not eligible.
DISCUSSION
The Patient Protection and Affordable Care Act (PPACA) will no longer allow for City
Councilmembers to receive a stand -alone reimbursement arrangement for healthcare
expenses. In addition, the City would not be able to offer a Flexible Spending Account (FSA)
arrangement as is currently offered to regular full -time and part -time employees to reimburse for
medical expenses, not covered under our insurance. The reason why this option is no longer
available due to changes in the healthcare legislation is that Councilmembers are not currently
covered under an FSA plan; they currently do not contribute towards this benefit, and the
reimbursement amount the City provides ($3,400) is more than two times what is allowable
under the regulations.
Therefore, the only option available is to continue to offer enrollment into the City Self- Insured
Medical plan. Enrollment on the City's Self- Insured Medical /Dental Plan would happen in
December, with coverage beginning January 1, 2014. For Councilmembers already receiving
insurance through their workplace, the City's plan would be secondary. The City insurance
would be primary if a councilmember is on a Medicare Supplemental plan. Dependents can be
added to the plan on a self -pay basis.
FINANCIAL IMPACT
The health insurance premium would cost $509.94 (2013 rates) per Councilmember, per month,
in addition to any impact on the plan.
The Council is being asked to consider this item at the October 14, 2013 Committee of the
Whole meeting and adopt the resolution at their October 21, 2013 Regular Meeting.
ATTACHMENTS
Resolution in Draft Form
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22
RAFT
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF TUKWILA, WASHINGTON, SETTING THE HEALTH
INSURANCE BENEFITS FOR CITY COUNCILMEMBERS.
WHEREAS, due to legislative action during 2007, the cost of a health care policy is no
longer considered to be additional compensation for elected officials; and
WHEREAS, since 2001, City Councilmembers have either received a reimbursement of
$3,400 per year for his or her own individual and eligible health care expenses or the City has
paid the premium for the Councilmember's individual coverage on the City's self- insured
medical plan; and
WHEREAS, City Councilmembers have the option to elect to participate in the City's self -
insured medical plan for individual coverage;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON,
HEREBY RESOLVES AS FOLLOWS:
Health Insurance Benefits:
A. Each member of the City Council, beginning January 1, 2014, may enroll in the City of
Tukwila's self- insured medical plan.
B. The City will pay the monthly premium for each Councilmember enrolled on the
medical plan. This benefit will only cover the Councilmember and not additional family
members. Councilmembers have the option of paying for dependent coverage separately.
C. Enrollment on the City's self- insured medical plan shall be a fringe benefit available to
the Councilmember by virtue of employment with the City and shall not be considered part of
the Councilmember's stipend or wages
PASSED BY THE CITY COUNCIL OF THE CITY OF TUKWILA, WASHINGTON, at a
Regular Meeting thereof this day of , 2013.
ATTEST /AUTHENTICATED:
Christy O'Flaherty, MMC, City Clerk Kathy Hougardy, Council President
APPROVED AS TO FORM BY:
Filed with the City Clerk:
Passed by the City Council:
Resolution Number:
Shelley M. Kerslake, City Attorney
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