City Commission Approved Insurance Agreement Renewals

During Monday's City Commission Meeting, commissioners granted approval for the City Manager to execute Insurance Agreement Renewals. The renewals encompass the following agreements:

A) Blue Cross Blue Shield of Kansas - Administrative Services for a Self-Funded Health and Prescription Benefit Plan, along with Individual and Aggregate Stop-loss Coverage.
B) Delta Dental of Kansas - Dental Benefits.
C) Tria Health - Medication Therapy Management.

Background:
The City of Salina has pursued a self-funded health insurance program since 1997, extending coverage to City employees, subgroups (Salina Public Library, Salina Airport Authority, and Salina Housing Authority), as well as retirees under age 65. This approach involves the City contributing premiums to a health insurance fund, managing its medical claims, and utilizing stop-loss coverage to mitigate financial risks associated with large claims.

Blue Cross Blue Shield of Kansas (BCBSKS):
BCBSKS provides administrative services, including claim processing, customer service, and cost control. The City's stop-loss coverage, crucial for financial protection, has both individual and aggregate components. The City opted for self-funding to control costs and assumed some risk. The renewal with BCBSKS includes a premium holiday of $50,000 for 2024, reflecting in reduced total costs.

Delta Dental of Kansas:
The City has engaged with Delta Dental of Kansas for dental benefits since 1996-97, with no notable concerns about service or participant satisfaction. The renewal for 2024 maintains administrative fees at $4.00 per member per month, projecting stability in costs.

Tria Health:
Tria Health, a medication therapy management company, has been a part of the City's health plan since 2015, contributing to significant savings. The proposal includes a two-year extension with no increase in fixed fees, offering flexibility based on plan enrollment and program engagement.

Health Plan Structure:
The City's health plan structure includes three options: individual, employee plus one, and family. The City implemented the employee plus one tier six years ago, offering a discounted rate for additional coverage. Premiums, collected from employers, employees, and subgroups, are structured with 20% from employee contributions and 80% from City contributions.

Health Insurance Fund Management:
The City follows a systematic approach, outlined in the Health Insurance Fund Management Policy, to calculate the minimum and maximum annual target balance. The policy addresses actions to be taken if the balance deviates from the set ranges. The estimated target balance for 2024 considers claims history, stop-loss levels, and projected claims.

In summary, all proposed insurance agreement renewals were unanimously approved during the meeting. The City's commitment to a self-funded model, in conjunction with effective management and strategic partnerships, aims to provide stable and cost-effective health coverage for its employees and stakeholders.