2000-05-15 Special Called Workshop Meeting

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• • CITY OF LA PORTE INTEROFFICE MEMORANDUM MAY 1, 2000 TO: Mayor and Council FROM: Louis Rigby, Director of Administrative Services SUBJECT: Retiree Medical Coverage During the April 17ei workshop, Council asked staff to review the newly adopted retiree medical policy and make the following changes: • Remove that portion which included retirees who retired in 1994 and later. The revised policy shall include only.those retirees who retire after the date selected byCouncil. All current retirees will remain on the plan in effect when they retired. • Remove the °point system' and change the "Cost to City" section to reflect 45°% cost to City for at least 10 years of service, 75°% cost to City for at least. 15 years service, and 100°% cost to City for at least 20 years service. NOTE: N Council wishes to adopt the "at'least 20 years, 100W policy, the 80 point system would by redundant. For example, an employee who started work at age 20 and worked until age 40, would only have a point total of 60, :but would still get the 100°%benefit because they worked 20 years. Council also asked that the definition of retiree remain the same and continue the policy that should a retiree go to work for an employer that offers medical insurance, the retiree shall no longer be covered by the City. In addition to those items listed above, there were several that were not addressed. Those items, with recommendations from staff, are listed in Exhibit F of the attached April 171hCouncil agenda. Staff has researched the possibility of providing supplemental insurance for retirees and has found that companies such as Humana and Blue Cross are no longer writing group coverage for retirees under the age of 65. They are recommending that retirees be covered by self -funding, which we already have. To purchase non -group coverage, through Blue Cross, for a typical 45 year old, non-smoking applicant with a 40 year old spouse and two children would cost $401 per month, or $4,812 per year.