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Home My WebLink About5/15/1990 - Adopted Board RecordsACTION I A-51590-1 ITEM NUMBER D AT A REGULAR MEETING OF THE BOARD OF SUPERVISORS OF ROANOKE COUNTY, VIRGINIA HELD AT THE ROANOKE COUNTY ADMINISTRATION CENTER MEETING DATE: May 15, 1990 AGENDA ITEM: Selection of Health Insurance Coverage for 1990-91 COUNTY ADMINISTRATOR'S COMMENTS: BACKGROUND: The County and the County Schools requested proposals for health insurance coverage for the County employees and the School employees, both on a stand-alone basis and on a combined basis.. These proposals were reviewed jointly by the County insurance committee and the School insurance committee to determine the most beneficial coverage and cost for all employees. SUMMARY OF INFORMATION: Selection of Coverage: Only.one bid was received from Blue Cross/Blue Shield. This bid examined several options for combined or stand alone policies, and Key Care. We also reviewed a proposal from the State of Virginia on the Local Choice Program and met with Community Care Network (CCN) to review the savings which they could offer through a third party review and selection process. These programs are summarized below: 1) Blue Cross/Blue Shield (Combined vs. Stand-alone policies for County and Schools): The bids from Blue Cross/Blue Shield reflected a 16% increase in rates, which is below the market trend increase in health insurance costs. This shows that our efforts at cost containment are proving to be beneficial. This year the Schools would like to purchase a minimum premium self-insurance type arrangement such as the one the County has had in effect for two years. Under this arrangement, we only pay as claims are incurred and keep any savings due to good experience during the year. Our liability level is capped so that there will be no additional unexpected expenses. By combining the Schools and County policies, we were able to save $58,000. These savings were allocated between the County and the Schools. Blue Cross will maintain separate accounting for the Schools and the County, and we will maintain separate billings and reserves. The County has already fully funded its reserve, and the schools are attempting to fund 2/3 of their reserve the first year. The proposed rates, and the comparison to prior year rates for the County are shown on Attachment A and for the Schools are shown on Attachment B. 2) Key Care: Key Care was reviewed as a possible alternate selection to the Blue Cross/Blue Shield plan. Even though the rates are substantially lower, at this time there are no Key Care physicians in the Roanoke Valley. We feel this will not be a viable option until they have a good variety of participating physicians. 3) Local Choice Program: The Local Choice Program is the insurance program developed by the State to give localities availability of a plan similar to the State Plan. It is not the State Plan, nor is it in anyway funded by the State. Attachment C shows a comparison between the Local Choice rates and our current and proposed Blue Cross rates. Staff decided against this option for the following reasons: a) There are no caps on the liability. If the County were to use more in claims than the premiums it paid into the plan, the State would assess us at year end for the difference. b) There is no incentive for cost containment. The County is not reimbursed for any savings due to good claims experience. The State would keep these savings. C) The benefits for the Local Choice Program are not as good as our current benefits. d) Retirees rates are exorbitant. We are currently offering coverage to our retirees at the same rates offered to current employees. 4) Community Care Network (CCN): Community Care Network acts as an overlay to any TPA (Third Party Administrator) type insurance policy. CCN has negotiated with Lewis-Gale and Community hospitals to receive discounts for their members when they use these facilities. Savings are based on redirecting our employees from all other hospitals to these two hospitals. In order to be a member of CCN, there needs to be a monetary penalty to the employees if they choose to use a non -participating hospital. Similar to Key Care, CCN has not been able to sign any participating physicians with its plan. 2 In order to take advantage of the CCN program, we would need to change from our current insurance program to a TPA arrangement. Blue Cross/Blue Shield is not offering reinsurance on any of its TPA's where CCN is involved. This means that we will lose the hospital discount and the physicians discount that we currently have with Blue Cross/Blue Shield. In addition, we would need to start over with our insurance bids in order to solicit reinsurance coverage. Attachment D shows the net effect of the CCN savings and the discounts lost with Blue Cross/Blue Shield. Within the last week, CCN has lost their customer services representative in the Roanoke Office. There are presently only two clerical people in the Roanoke office, and there is a good possibility that the office will be relocated to Northern Virginia. This would have an impact on the timeliness of the service they could offer to our employees. County Funding Policy: In the past, the County has given more benefit to employees purchasing family coverage than to those purchasing employee only coverage. Attachment A shows that we are trying to eliminate this differential. At the same time, we are trying to increase the County contribution to 90% of the single coverage. As shown on Attachment B, the contribution amount paid for Schools employees is only $6.10 less than that paid for County employees purchasing single coverage, even though on a percentage basis the Schools are contributing 50% of the single premium and the County is contributing 77% of the single premium. STAFF RECOMMENDATION: Staff recommends the following: 1) Purchase the Blue Cross/Blue Shield minimum premium combined program for County and Schools as shown on Attachments A and B. 2) Reject the proposal from CCN to participate in their program. 3) F.atahl i ch a pnl ii ---v anal for County anti School —contributions --to, be funded at 904 -of the -levee s4 figle rate that -.a -1 -I -School -and-. Countyamp!a the same -dollar amount benefit. This goal is-to-be --wi-th,in_--the---next__ thro-e- yews. - ----- f Diane D. HyattoElmer C. Hodge Director of Finance County Administrator ACTION VOTE No Yes Abs Approved (X ) Motion by: Denied ( ) 3mendel3 by HArrT Ni rrkena., Eddy _ Received ( ) to approve staff rarrnmmendationJohnson x Referred ( ) with #3 deleted McGraw x To Nickens _x Robers x cc: File Diane Hyatt, Director, Finance Reta Busher, Director, Management & Budget Paul Mahoney, County Attorney Keith Cook, Director, Human Resources John Chambliss, Assistant County Administrator John Hubbard, Assistant County Administrator Don Myers, Assistant County Administrator Dr. Bayes Wilson, Superintendent, Roanoke County Schools 4 a >_1 O O iC M oqq• 0O0 O, oqq• Q` a Ei M �D M 00 cN C., d4 'ter C ;To0000 A 69 6 r--4 I ON C � O� to �D � � .N -•i � 6A a C c �o c`O�•`�a. oNq �._ O� ON 000 M C r-:�0 *t- MM D. 6R r Cfi 0�0 a >_1 O O 4) O O Q` a Ei O, a 0000 W ( cN C., rn ;To0000 A 69 C I: en M C �._ 0O 000 CD CD C r-:�0 *t- MM D. r Cfi 0�0 C r- M 0000 Cu 06 C5 4o6N N N T N 00 c� cc a> °O 00WLz, ON >-% 7a >_1 O O 4) O O Q` a Ei O, a 0000 W ( cN C., rn Attachment A Attachment B 0 0 0 0 0 W a� a� �-• 00 Lw 01% .� A,A �. 00WWw (FWWG`i y b4 tw v K CN I�t NSW) — � 0. M ONO N M w d4 C 0 N N N N N N IC�� 00 00 00 w C yg 00 i)r-0000 , M SW) bs 0 0 0 0 a� a� 4) 0 a) a) Lw 01% .� A,A �. 00WWw (FWWG`i Count Employees State of Virginia Proposal Local Choice Program State Proposal Regular Employees Retirees Attachment C Current Rates Proposed 1989-90 1990-91 Single $ 93.00 $ 233.00 $ 98.72 $ 114.54 Single + 1 minor 186.00 465.00 n/a n/a Family 233.00 583.00 240.02 278.44 School Employees Single 149.00 373.00 136.56 164.38 Single + 1 minor 298.00 745.00 200.74 241.64 Family 417.00 1,043.00 346.86 417.52 Attachment D Analysis of CCN Savings County Only Coun + School Estimated Savings from CCN $ 62,542 $ 200,000 Blue Cross/Blue Shield discounts lost by converting to TPA arrangement Hospital discount (36,000) (104,000) Physicians discount (35,000) (91,000) Savings lost because of foregoing combined Blue Cross/ Blue Shield program with Schools (58,000) -0- Net savings (loss) with CCN 66 458 5 000 In addition to the above, the County would assume an additional 15% liability in the stop loss aggregate by changing to TPA 216 020 596 300 ACTION # A-51590-2 ITEM NUMBER E AT A REGULAR MEETING OF THE BOARD OF SUPERVISORS OF ROANOKE COUNTY, VIRGINIA HELD AT THE ROANOKE COUNTY ADMINISTRATION CENTER MEETING DATE: May 15, 1990 AGENDA ITEM: Adoption of the Fiscal Year 1990-91 Budget COUNTY ADMINISTRATOR'S COMMENTS: SUMMARY OF INFORMATION: Attached is the 1990-91 Fiscal Year Budget. Several changes were made to the original budget document presented to the Board of Supervisors on April 10, 1990. These changes are summarized below: A. Revenues. On April 10, 1990 the Board of Supervisors directed the County Administrator to prepare the FY 1990-91 budget with a real estate tax rate of $1.13 per $100 of assessed value effective January 1, 1991. The result was a reduction of real estate tax revenues in the amount of $271,000. The County Administrator, upon further review of the User Fee Study proposed to increase the Parks and Recreation user fees to generate an additional $97,013 for a total proposed increase in user fees for FY 1990-91 of $295,813. The net affect of these changes was a reduction in incremental new General Fund revenues from $4,701,802 to $4,527,815 or $173,987. B. Expenditures. The $350,000 set aside in the Capital Fund for the new regional landfill was eliminated to offset the 2C real estate tax rate reduction. As well, several addback requests were funded from the net affect of the above changes. Social Services (Fraud Investigator $ 94,815 Position and 5% Salary Increase) Transportation Museum 4,590 Virginia Western Arboretum 1,660 Historical Architecture Grant 20,000 Human Service Agencies 11,053 Board of Zoning Appeals 4,750 Compensation Board Salary Increases 38,948 Other Misc. Rounding Adjustments 197 6,013 C. Schools. The consolidation of the County and School Finance Departments as of July 1, 1990 will allow the School Board to redirect $104,965 in local funds. ' The County's share of incremental new revenues will cover the cost of the four employees salaries and benefits. The State has notified Roanoke County that the Appropriations Act has been revised to require that all school districts in the State of Virginia must "front end" a certain portion of the employer's share of VSRS. The employer contribution rate is 11.76% in fiscal year 1990-91. This rate reflects an increase of 1.1% over the rate quoted to Roanoke County in a memorandum from VSRS dated January 25, 1990. The Roanoke County School Budget for 1990-91 was prepared using the quoted rate of 10.66%. According to the Department of Education, VSRS will refund the additional 1.1% of the local funded salaries to each locality at the end of the year. Therefore, both the school revenues and expenditures from the State will be increased by the 1.1% VSRS cost increase or $429,441. FISCAL IMPACT: The 1990-91 Fiscal Year Budget totals $152,930,941. This includes the changes outlined above and all interfund transfers. The budget net of interfund transfers is $112,619,133. STAFF RECOMMENDATION: Staff recommends the adoption of the 1990-91 Fiscal Year Budget as presented. The next step in the budget process will be the adoption of the Budget Appropriation Ordinance. The first reading will be on May 22, 1990, and the second reading will be on June 12, 1990. Respectfully submitted, L -la- k sties& Reta R. Busher Director of Management & Budget Approved by, Elmer C. Hodge County Administrator 2 ACTION VOTE No Yes Abs Approved (x ) Motion by: Reh L_ Johnson Denied ( ) as amended, with $37,142 Eddy x Received ( ) added to unappropriated Johnson x Referred ( ) balance McGraw x To Nickens x Robers x cc: File Reta Busher, Director, Management & Budget Diane Hyatt, Director, Finance Paul Mahoney, County Attorney Keith Cook, Director, Human Resources John Chambliss, Assistant County Administrator John Hubbard, Assistant County Administrator Don Myers, Assistant County Administrator 3 COUNTY OF ROANOKE, VIRGINIA SUMMARY OF PROPOSED 1990-91 BUDGET REVENUES Source Amount General Fund: General Property Taxes $ 45,659,000 Other Local Taxes 12,369,500 Permits, Fees, and Licenses 674,063 Fines and Forfeitures 165,000 Charges for Services 165,400 Miscellaneous 279,500 Recovered Costs 270,000 Commonwealth 7,299,000 Total General Fund Budget $ 66,881,463 Debt Service Fund 7,264,622 Youth Haven II Fund 331,319 Internal Service Fund 1,168,754 Capital Projects Fund 372,155 Utility Fund 8,466,757 Offsite Facilities Fund - Water 88,193 Offsite Facilities Fund - Sewer 195,101 Garage II Fund 233,700 Recreation Fee Class Fund 351,256 School Operating Fund 62,573,262 Cafeteria Fund 2,724,000 Federal Programs Fund 1,543,521 Textbook Fund 736,838 Total Budget All Funds $152,930,941 Less: Interfund Transfers (40,311,808) Net Budget $112,§,19133 4 General Fund: General Government Administration $ 1,166,127 Constitutional Officers 4,745,394 Judicial Administration 163,867 Management Services 2,618,244 Public Safety 6,609,938 Community Services 4,678,634 Human Services 7,374,154 Transfer to Schools 31,223,230 Transfer to Capital Outlay 322,155 Transfer to Debt Service 5,383,995 Transfer to Other Funds 846,097 Non -Departmental 1,699,628 Contingent Balance 50,000 Total General Fund Balance $66,881,463 Debt Service Fund 7,264,622 Youth Haven II Fund 331,319 Internal Service Fund 1,168,754 Capital Projects Fund 372,155 Utility Fund 8,466,757 Offsite Facilities Fund - Water 88,193 Offsite Facilities Fund - Sewer 195,101 Garage II Fund 233,700 Recreation Fee Class Fund 351,256 School Operating Fund 62,573,262 Cafeteria Fund 2,724,000 Federal Programs Fund 1,543,521 Textbook Fund 736,838 Total Budget all Funds $152,930,941 Less: Interfund Transfers (40,311,808) Net Budget 5112,619,133