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Home My WebLink AboutResolutions - 2024.09.05 - 41450 AGENDA ITEM: Benefits Additions Resulting from Employee Benefits Survey and Preliminary Inclusive Benefits Analysis DEPARTMENT: Human Resources MEETING: Board of Commissioners DATE: Thursday, September 5, 2024 9:42 PM - Click to View Agenda ITEM SUMMARY SHEET COMMITTEE REPORT TO BOARD Resolution #2024-4402 Motion to approve the following additions to employee benefits for non-represented employees: • Add Spouse/Dependent Life and AD&D insurance as an employee-paid option • Add Pet Insurance as an employee-paid option • Add the State of Michigan MESP 529 Plan as an employee-paid option • Expand coverage for hearing aids across all medical plans for active employees and retirees • Expand access to preventive dental services across all dental plans by exempting preventive services from the annual dollar maximum • Expand access to fertility treatment and Maven across all plans for active employees and retirees • Add enhancements to target top health conditions (ie diabetes management and prevention, hypertension management, weight management) across all plans for active employees and retirees • Improve optical plan design and network; further, to authorize the Human Resources Department to seek Letters of Agreements with all unions to adopt the same benefits modifications; further, to approve the cost of implementing these additions, which has been included in the proposed Fiscal Year 2025 Fringe Benefit Fund appropriation. ITEM CATEGORY SPONSORED BY Resolution Brendan Johnson INTRODUCTION AND BACKGROUND The Human Resources Department has completed an employee benefits survey as part of a more comprehensive inclusive benefits analysis. The results of the inclusive benefits project are expected to be presented in the fall of 2024. As a result of the employee benefits survey, the Human Resources Department has identified certain cost-neutral or low cost/high priority additions and requests approval to incorporate them in the 2025 Open Enrollment offerings. These changes would be effective January 1, 2025, for all non-union employees, and Human Resources would engage with the labor unions to seek letters of agreement to offer these additions to union employees. The proposed additions are: • Add Spouse/Dependent Life and AD&D insurance as an employee-paid option • Add Pet Insurance as an employee-paid option • Add the State of Michigan MESP 529 Plan as an employee-paid option • Expand coverage for hearing aids across all medical plans for active employees and retirees • Expand access to preventive dental services across all dental plans by exempting preventive services from the annual dollar maximum • Expand access to fertility treatment and Maven across all plans for active employees and retirees • Add enhancements to target top health conditions (ie diabetes management and prevention, hypertension management, weight management) across all plans for active employees and retirees • Improve optical plan design and network POLICY ANALYSIS The Human Resources Department is seeking approval to make some additions to non-represented employees benefits to include the following options: Employee-Paid Options • Life and Accidental Death & Dismemberment insurance • Pet Insurance • State of Michigan Education Savings Program (MESP) 529 Plan Expansion of Coverage • Offer hearing aids across all medical plans for active employees and retirees • Dental - Exempt preventive services from the annual dollar maximum to expand access across all dental plans • Provide access to fertility treatment and access to Maven* for active employees and retirees • Add enhancements to target top health conditions (diabetes management and prevention, hypertension management, weight management) across all medical plans • Improve the optical plan design and network *Maven provides services for fertility and family-building, maternity and newborn care, parenting and pediatrics as well as menopause and ongoing care - for more information, click on this link. BUDGET AMENDMENT REQUIRED: No Committee members can contact Barbara Winter, Policy and Fiscal Analysis Supervisor at 248.821.3065 or winterb@oakgov.com or the department contact persons listed for additional information. CONTACT Heather Van Poucker ITEM REVIEW TRACKING Aaron Snover, Board of Commissioners Created/Initiated - 9/5/2024 AGENDA DEADLINE: 09/15/2024 9:42 PM ATTACHMENTS 1. Benefit additions for Jan 2025 2. LAGO August 20 2024 Benefits Update COMMITTEE TRACKING 2024-08-20 Legislative Affairs and Government Operations - Recommend to Board 2024-09-05 Full Board - Adopt Motioned by: Commissioner Michael Gingell Seconded by: Commissioner Penny Luebs Yes: David Woodward, Michael Spisz, Michael Gingell, Penny Luebs, Karen Joliat, Kristen Nelson, Christine Long, Philip Weipert, Gwen Markham, Angela Powell, Marcia Gershenson, Yolanda Smith Charles, Charles Cavell, Brendan Johnson, Ajay Raman, Ann Erickson Gault, Linnie Taylor (17) No: None (0) Abstain: None (0) Absent: William Miller III, Robert Hoffman (2) Passed LAGO BENEFITS UPDATE Effective 1/1/2025 August 20, 2024 1 2 OVERVIEW Changes Proposed in Accordance with Current 5-Year Benefits Plan Additions Proposed in Response to Employee Benefits Survey Modifications Proposed in Anticipation of Inclusive Benefits Project Oakland County Benefits are superior when benchmarked across industries, public and private sector on a local, statewide & national level PPO FAMILY PLANS OAKLAND COUNTY Michigan (Large) Employers 1,000 - 4,999 County Govt.Local Govt. Monthly Employee Contribution $184 $541 $688 $676 $430 Median Family In-Network Deductible $0*$2,000 $1,500 $1,500 $1,250 Median In-Network Physician Copays (69% have split dollar copays)$20/20 $30/50 $25/40 $25/40 $25/40 Rx Copay (53% have 4 or 5 tier Rx Copays)$5/20/40 $10/40/80 $11/34/59/97 $9/27/47/55 $9/31/58/103 % Requiring Coinsurance N/A*90% 91%84%81% Median Coinsurance N/A*20%20%20%20% Median ER Copay $100 $150 $150 $150 $175 Source: June, 2024 Employee Benchmarking Study *Oakland County deductibles and coinsurance apply only to limited, select services such as durable medical equipment and private duty nursing Current 5-Year Benefits Roadmap 2022 (Internal Controls)Population Impacted Estimated Annual Savings Implement Narrow Pharmacy Network that excludes Walgreens Active and Retiree $1.2M Did not implement Implement Copay Assistance program for specialty drugs only Active and Retiree $1.3M Remove grandfathered drugs only (Erectile dysfunction/infertility drugs will be covered) Active and Retiree $120k Conduct medical and prescription drug claim audits Active and Retiree TBD Evaluate self-funding stop loss coverage N/A $500k - $700k Did not implement Remove dual coverage option Active and Retiree TBD Implement enhanced subrogation program on ASR plans Active and Retiree TBD Conduct dependent eligibility audit Active and Retiree $200k - $450k Modify dependent eligibility age-out to end of the month in which they turn 26 Active and Retiree $200k - $300k Total Annual Savings $3.52M-$4.07M 2023 Population Impacted Estimated Annual Savings Implement Employee Contribution changes Active $500k - $1.0M Replace ASR PPO 3 with a Narrow Network Plan alternative (lower employee contribution, but mimics ASR PPO 1 plan design) Active and Retiree Cost Neutral and/or Potential Savings Did not implement 4 2026 Population Impacted Estimated Annual Savings Implement Employee Contribution changes Active $500k - $1.0M 2025 Population Impacted Estimated Annual Savings Internal controls*Active TBD Implement Prescription Drug Copay changes ($5/$20/40 to $10/$30/$50)Active $326k 2024 Population Impacted Estimated Annual Savings Conduct dependent eligibility audit and other internal controls*Active $200k-$450k Will conduct every 3-5 years *Internal Controls for Additional Savings Internal plan management with Rx, labs, testing Education on generic vs. brand name Rx Wellness Program education and initiatives for preventative care 2022-2026 Savings Estimated Total Savings Total 5-Year Plan Savings $5.05M – $6.85M 5 Changes Proposed in Accordance with Current 5-Year Benefits Plan Rx Co-Pay Increase to $10/30/50 Align with BCBS Formulary Dependents remain eligible through end of the month in which they turn age 26 (exception for disabled dependents) 6 Additions Proposed in Response to Employee Benefits Survey Optional Spouse/Dependent Life & AD&D Optional Pet Insurance Optional MESP 529 Plan Improved Vision Plan Improved Dental Plan 7 Additions Proposed to Improve Access/Equity Expand hearing aid coverage across plans Expand Maven across plans (family forming/adoption support, maternity and post-partum support, menopause support) Enhancements to support most common health conditions across plans QUESTIONS? 8