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Home My WebLink AboutCOW 2013-10-28 Item 4E - Resolution - 2014 Council BenefitsCOUNCIL AGENDA SYNOPSIS Initials MeetinsDate Prepared by Mayor's revio7 ' Council review 10/28/13 SB ., . 10/28/13 11/04/13 SB Z Resolution Mtg Date 11/4/13 _.— Bid Award Mtg Date —__ Public Hearing Mtg Date Other Mtg Date CA'I'EGORY 2 Discussion • Ordinance Mtg Date Mtg Date LI Mayor . DCD Finance Fire I— IT 111 P&R E Police PIY/ ITEM INFORMATION ITEM No. 4.E. 89 STAFF SPONSOR: STEPHANIE BROWN ORIGINAL , AG ENDA DATE: 10/28/13 AGENDA ITEM TITLE 2014 Councilmember Benefits 10/28/13 Mtg Motion Date Z Resolution Mtg Date 11/4/13 _.— Bid Award Mtg Date —__ Public Hearing Mtg Date Other Mtg Date CA'I'EGORY 2 Discussion • Ordinance Mtg Date Mtg Date LI Mayor . DCD Finance Fire I— IT 111 P&R E Police PIY/ SPONSOR Council E HR SPONSOR'S Under the Patient Protection and Affordable Care Act (PPACA), the City's health expense SUMMARY reimbursement to Councilmembers is considered a health plan. The reimbursement arrangement as it currently exists will be prohibited by PPACA after January 1, 2014. Councilmembers will have two options, to enroll in the City Self-Insured Medical Plan or Group Health to continue to receive a healthcare benefit in 2014. REVIEWIM BY COW Mtg. CA&P Cmte Z F&S Cmte E Transportation Cmte Utilities Cmte Arts Comm. Parks Comm. E Planning Comm. DATE: 10/22/13 COMMITTEE CHAIR: ROBERTSON RECOMMENDATIONS: SPoNsoR/ADmIN, COMMMEE Human Resources Department Unanimous Approval; Forward to Committee of the Whole COST IMPACT / FUND SOURCE EXPENDITURE REQUIRED AMOUNT BUDGETED APPROPRIATION REQUIRED $ Based on Council participation $ $60,310.32 (max) Fund Source: Comments: MTG. DATE RECORD OF COUNCIL ACTION 10/28/13 MTG. DATE ATTACHMENTS 10/28/13 Informational Memorandum dated 10/2/13 Resolutions in Draft Form Minutes from the Finance & Safety Committee meeting of 10/22/13 11/4/13 89 90 TO: 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 and Group Health Cooperative. Enrollment on the City's Self- Insured Medical /Dental Plan and Group Health Cooperative 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 /RECOMMENDATION The health insurance premium for the City Self Insured Medical /Dental Plan would cost $509.94 (2013 rates) per Councilmember, and for Group Health Cooperative the cost would be $717.98, per month in addition to any impact on the plan. The Council is being asked to consider this item at the October 28, 2013 Committee of the Whole meeting and adopt the resolution at their November 4, 2013 Regular Meeting. ATTACHMENTS Resolution in Draft Form 91 92 R FT 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 City's self insured medical plan for individual coverage; WHEREAS, under the Patient Protection and Affordable Care Act (PPACA), the City's health expense reimbursement to Councilmembers is considered a stand -alone health plan, and the reimbursement arrangement as it currently exists will be prohibited by PPACA after January 1, 2014; 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 or the Group Health Cooperative plan. B. The City will pay the monthly premium for each Councilmember enrolled on the selected 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 a City's self insurcd 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 W: \Word Processing \Resolutions \Health insurance benefits for Councilmembers 10 -16 -13 SB:bjs Page 1 of 2 93 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 W: \Word Processing \Resolutions \Health insurance benefits for Councilmembers 10 -16 -13 SB:bjs 94 Page 2 of 2 City of Tukwila FINANCE AND SAFETY COMMITTEE Meeting Minutes October 22, 2013 — 5:30 p.m.; Conference Room #3 Finance and Safety Committee PRESENT Councilmembers: Dennis Robertson, Chair; De'Sean Quinn and Kathy Hougardy (Absent: Verna Seal) Staff: Peggy McCarthy, Vicky, Carlsen, Stephanie Brown, Kim Gilman, Shelley Kerslake, Brendan Kerin, Nora Gierloff, Christy O'Flaherty, Bruce Linton, Laurel Humphrey Guest: Chuck Parrish CALL TO ORDER: Committee Chair Robertson called the meeting to order at 5:30 p.m. I. PRESENTATIONS No presentations. II. BUSINESS AGENDA A. Ordinance —Civil Service Commission Staff is seeking Council approval of an ordinance that would revise Tukwila Municipal Code Chapter 2.42, Civil Service Commission, to reflect the current provisions of Revised Code of Washington 41.04.010, governing the use of Veteran's Points in hiring and promotional processes. Candidates eligible for Veteran's Points can claim either a 10% or 5% credit to their score, depending on retirement status. The proposed ordinance is also in alignment with recently revised civil service rules. UNANIMOUS APPROVAL. FORWARD TO NOVEMBER 4 REGULAR CONSENT AGENDA. B. Resolution — Council Benefits Staff is seeking Council approval of a resolution that would update health insurance benefits for Councilmembers in response to the Patient Protection and Affordable Care Act (PPACA) of 2007. Since 2001, Councilmembers have received a benefit in which they can receive reimbursement for eligible medical expenses up to $3,400 per year, but this option is prohibited under the PPACA. Enrollment in the City Self - Insured Medical Plan or Group Health Cooperative will be the medical benefit options for Councilmembers as of January 1. The monthly premium for individual Councilmembers would be paid by the City as it is for employees ($509.94 for City Self - Insured and 717.98 for Group Health). As follow up to the October 8 committee discussion, staff returned with an updated draft resolution that includes the option to enroll in the Group Health Cooperative and adds a recital explaining the impetus for the change. Staff also provided clarification on the tier of coverage for a Councilmember already possessing coverage via their employer and their spouse's employer. In this scenario, the City coverage becomes second tier, and the spouse's employer coverage falls to third. UNANIMOUS APPROVAL. FORWARD TO OCTOBER 28 COMMITTEE OF THE WHOLE. C. Resolution — Cancellation of Past Due Accounts Receivable Staff is seeking Council approval of the annual resolution that would declare the cancellation of uncollectible accounts receivable. The total for this year is $30,702.97, which is higher than last year due to a complete foundation and signal pole assembly replacement as well as a hit and run damage to a pedestrian pole. Staff reviewed the rigorous process by which items are determined to be uncollectible. UNANIMOUS APPROVAL. FORWARD TO NOVEMBER 4 REGULAR CONSENT AGENDA. 95