HomeMy WebLinkAboutHBFA - Firefighters Association - - 1990-04-16'7, ,_2_C5
REQUEST FOR CITY COUNCIL ACTION
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Date
Submitted to: Honorable Mayor and City Council Members
Submitted by: Michael T. Uberuaga, City Administrator
Prepared by: Robert J. Franz, :deputy City Administrators �
Subject: MOU Amendment - Firemen's Association
Consistent with Council Policy? [X] Yes ( ] New Policy or
April. 16, 1990
Statement of Issue, Recommendation, Analysis, Funding Source, Alternative Actions, Attachments:
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Objective: To amend the MOU with employee organizations to reflect changes in the City's
medical benefit plan.
Recommendation: Adopt Resolution # 6120.
Analysis: All employee groups agreed with the proposed changes to the City's medical benefits
plan as described in the attached memorandum. Formal amendments to the multi -year
agreements with the groups are required to document the changes. The changes are reflected
in the attached MOU amendment which needs to be approved by a resolution of the City
Council.
In summary, the Firemen's Association has agreed to increase deductibles ($400 to $450 per
year maximum per family), increased maximum out-of-pocket expense ($550 to $750 per year
maximum per employee) and to apply the normal $150 deductible to hospitalization costs. In
return, the City is agreeing to increase its maximum payment for premiums from $400 'per
month to $459 per month.
The increased cost to the City for this change is greater than the estimated savings from the
benefit changes. For all employee groups combined, the increased cost is estimated to be
$120,000 per year.
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Funding Source: 1989/90 Budget
Alternatives: bequest further meeting and conferring.
Attachments:
1. November 2, 1989 Memorandum
2. Resolution
3. Amendment to MOU
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RESOLUTION NO. 6130
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
HUNTINGTON BEACH APPROVING AND IMPLEMENTING THE
MEMORANDUM OF UNDERSTANDING BETWEEN THE
HUNTINGTON BEACH FIREMEN'S ASSOCIATION AND THE CITY
OF HUNTINGTON BEACH FOR 1987 - 1990
The City Council of the City of Huntington Beach does resolve as follows:
The amendment to the October 1, 1987 Memorandum of Understanding between the
City of Huntington Beach and the Huntington Beach Firemen's Association, a copy of
which amendment is attached. hereto and by reference made a part hereof, is hereby
approved and ordered implemented in accordance with the terms and conditions thereof,
and the City Administrator is authorized to execute this agreement. Such Memorandum
of Understanding shall be effective January 1, 1990.
ATTEST:
REVIEWED AND APPROVED:
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mayor
APPROVED AS TO FORM:
City Atforney
INITIATED AND APPROVED:
City Administrator Administra r
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Resolution No. 6130
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss:
CITY OF HUNTINGTON BEACH )
I, CONNIE BROCKWAY, the duly elected, qualified City Clerk of the City of
Huntington Beach, and ex-officio Clek of the City Council of said City, do hereby certify
that the whole number of members of the City Council of the City of Huntington Beach is
seven; that the foregoing resolution was passed and adopted by the affirmative vote of at
least a majority of all the members of said City Council at a regular
meeting thereof held on the 16th day of April , 19 g0 , by the following
vote.
AYES: Councilmembers:
MacAllister, Winchell, Green, Bannister, Silva, Erskine
NOES: Councilmembers:
ABSENT: Councilmembers:
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City Clerk and ex-officio CMrk of
the City Council of the City of
Huntington Beach, California
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AMENDMENT TO MEMORANDUM OF UNDERSTANDING
BETWEEN
THE CITY OF HUNTINGTON BEACH
(HEREINAFTER. CALLED "CITY")
AND
THE HUNTINGTON BEACH FIREMEN'S ASSOCIATION
(HEREINAFTER CALLED "ASSOCIA.TION")
The representatives of the City and the Association have met and conferred on the
issues of medical and dental insurance and hereby agree to the following changes to the
MOU between the City and Association dated October 1, 1987.
Article 11. A.4. The CITY'S obligation to pay for health insurance premiums shall be
limited to four hundred and fifty-nine dollars ($459) per month for the duration of this
MOU. If the maximum monthly premium exceeds $459 any month during the remaining
term of this MOU, the parties agree to meet and confer for the purpose of discussing the
CITY'S maximum contribution towards premiums.
Article Il.A.5.a. Effective January 1, 1990, the maximum out-of-pocket expense for
covered expenses shall be seven hundred fifty ($750) per person per year after the
deductible has been met.
Article 11.A.5.b. Effective January 1, 1990, the Employee Health Plan shall be
modified to increase the maximum deductible per family from Four Hundred ($400) to
Four Hundred and Fifty ($450) during any period of benefit entitlement as described in the
City's Employee Health Plan. The maximum deductible per person is $150 during any
period of benefit entitlement as described in the Plan Document.
Article I I.A.5.e. (new) Effective January 1, 1990, covered hospitalization costs shall
be included under the covered costs subject to the plan deductible.
Article I I.B. DENTAL INSURANCE.
Article 11.13.1. The CITY shall provide each employee and his/her
dependents the dental and/or orthodontic insurance program
contained in Delta Care Policy #0038 or Delta Dental Policy
#4729-0003, attached hereto as Exhibits "F-1" and "F-2"
respectively. Employees may choose either plan.
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Article 11.B.2. (new) Effective January 1, 1990, the orthodontia
f benefit under the indemnity dental plan, Group No. 4729, shall be
modified to include adult members.
CITY OF HUNTINGTON BEACH
(A Municipal Corporation)
City Administrator
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HUNTINGTON BEACH -
FIREMEN'S ASSOCIATTL N
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'Date
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Association Re resentative
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Date
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CONFIDENTIAL
i� fe CITY OF HUNITIN GTONI BEACH
INTER -DEPARTMENT COMMUNICATION
HUNTINGTON BEACH
To HONORABLE MAYOR AND From ROBERT J. FRANZ
CITY COUNCIL MEMBERS Deputy City Administrator
Subject MAXIMUM CITY CONTRIBUTION - Date NOVEMBER 2, 1989
EMPLOYEE IIEALTII PLAN PRER/:IUMS
The current agreements with all employee organizations limit the -City contribution towards the
monthly cost of medical premiums to a maximum of $400. The premium for the City Plan as of
January 1, 1990 for coverage of an employee and two or more dependents (full family coverage)
will be $459 per month. Our current agreements with employee organizations require us to meet
and confer with them if the cost exceeds $400 per month. We have been conducting those meet
and confer sessions in accordance with the agreements.
As you can see in the attached exhibits, the City's monthly rates for health plan coverage are
comparable to rates for plans in other cities. Three or four years ago, the City plan was the
highest cost, but now we are "average" in terms of cost. Please note also that many of the rates
represented for other cities will be adjusted January 1 or sometime in mid-1990 whereas the
City's rates are indicated for both 1989 and 1990. In addition, please note that City costs have
been under relatively good control over the last six years since the City took over a self -insured
and self-administered plan. We have not experienced the recent 30 to 70% medical plan premium
increases that have received so much publicity in the media.
In addition, we have been able to get excellent cooperation from employee groups in the past six
years to implement cost control and incentive programs to help control overall City claims costs.
For all of these reasons, the ,City staff is recommending that the maximum City contribution to
the health plan costs be increased from $400 to $459 per month if the employee organizations will
agree to the following plan benefit changes:
1. Increase the maximum deductible per family from $400 to $450 per year.
2. Increase the maximum out-of-pocket employee co -payment from the
current $550 to $750 per year.
3. Modify the plan to have the $150 deductible for plan benefits apply to
hospitalization costs which, under the current plan, are paid without
assessing a deductible.
With the above plan changes, it is our opinion that we will be able to continue to exercise good
cost control on our medical claims. While this will not result in any dramatic savings as doctors
and hospitals continue to charge more for their services, it should result in the City continuing to
control its costs to the maximum extent possible.
The estimated cost of increasing the City's maximum payment is $220,000 per year, while the
savings from the benefit changes is unknown but estimated to be in excess of $100,000. The net
increase in cost represents a 3.7 % increase in the health plan costs that otherwise would be
assessed to employees. Another way of computing the same cost is to calculate its value in the
total salary and benefits package. Expressed in this manner, the charge represents a 0.2 %
increase in the salary and benefit package.
Attachments
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