May 8, 2023 TRUST SPECIAL MEETING OF THE CITY OF NEDERLAND
EMPLOYEE BENEFITS TRUST
4:44 p.m. May 8, 2023
1. MEETING
The meeting was called to order at 6:33 p.m. by Chairperson Albanese at the
Nederland City Office Building, 207 N. 12TH Street, Nederland, Texas.
The following statement was posted:
"PURSUANT TO SECTION 30.07, PENAL CODE (TRESPASS BY LICENSE HOLDER
WITH AN OPENLY CARRIED HANDGUN), A PERSON LICENSED UNDER
SUBCHAPTER H, CHAPTER 411, GOVERNMENT CODE (HANDGUN LICENSING
LAW), MAY NOT ENTER THIS PROPERTY WITH A HANDGUN THAT IS CARRIED
OPENLY."
2. APPROVAL OF MINUTES
A motion was made by Trustee Root and seconded by Trustee Austin to approve the
minutes of the May 9, 2022 meeting of the Employee Benefits Trust as written.
MOTION CARRIED.
Ayes: Chairperson Albanese, Trustees Austin, Root, Sonnier, and Guillot.
Noes: None.
3. HEALTH INSURANCE
Mr. Duque, said the City's health insurance provider is Blue Cross/Blue Shield of Texas
(BCBST) which expires on June 30th. The current plan year (July 2022 - March
2023) loss ratio (total paid medical and prescription claims over paid premiums) is
150%. Bids were opened on April 20th.
Currently the City provides a three-option plan design (Standard Plan, High
Deductible Health Plan and a Health Maintenance Organization Plan) with varying
levels of dependent coverage (employee-only, employee + spouse, employee +
children, and family) and differing monthly premiums. The City utilizes two defined
contributions: one for the Standard Plan and the HAS Plan and another for the HMO
Plan.
Due to the high loss ratio, the submitted bids were high. The City's insurance
consultant (HUB International) negotiated a best and final offer from Blue Cross/Blue
Shield of Texas with a rate reduction renewal (BCBS is also providing a $50,000 one-
time premium credit that further reduced the best and final renewal) while
maintaining the same standard plan design (a $1,500 deductible and $6,500
maximum out of pocket benefit) and blended rates (active employees indirectly
subsidize retiree insurance). The HSA plan was revised to reflect the latest IRS
requirements (in-network deductible increased from $2,800 to $3,000). BC/BS of
Texas will continue to offer the HMO plan utilizing the "Blue Essentials" network that
has minimal disruption from the existing PPO network. Two defined contributions are
recommended: one for the Standard Plan and the HSA Plan and another for the HMO
Plan.
The recommended Standard Plan/HSA Plan and HMO Plan Defined Contributions will
reduce the City's annual costs by $28.44 (0.00224%) and will reduce the employees'
dependent coverage costs. Across all tiers of coverage, the defined contributions were
increased by approximately $11. The increased defined contributions and premium
decreases result in the employees' costs decreasing at varying amounts based on their
selected dependent contribution and the existing dependent coverage percentage
decreasing. The recommended funding results in approximately $28,000 in annual
savings for the City employees with dependent coverage.
A motion was made by Trustee Root and seconded by Trustee Sonnier to award a bid for
employee health insurance to Blue Cross/Blue Shield of Texas. MOTION CARRIED.
Ayes: Chairperson Albanese, Trustees Austin, Root, Sonnier, and Guillot.
Noes: None.
4. DENTAL INSURANCE
Mr. Duque, stated the City utilizes Blue Cross/Blue Shield of Texas as its dental
insurance provider. Under the dental insurance plan design, the City pays 100% of the
employee premiums and 0% of dependent premiums, regardless of whether the
employee chooses the HIGH or LOW plan. The majority of City employees and
retirees utilize the HIGH plan.
The BCBS of Texas renewal offer is a rate pass (no increase) from the current
premiums. The City annually spends approximately $35,000 on dental insurance
premiums. In addition, the BCBS of Texas bid included a bundling discount with their
health insurance. Therefore, the recommendation is to renew the dental insurance bid
to BCBS of Texas maintaining the same plan design and contribution model.
A motion was made by Trustee Root and seconded by Trustee Guillot to award a bid
for employee dental insurance to Blue Cross Blue Shield Texas. MOTION CARRIED.
Ayes: Chairperson Albanese, Trustees Austin, Root, Sonnier, and Guillot.
Noes: None.
5. LIFE/AD&D/LTD
Currently, the City utilizes Blue Cross/Blue Shield of Texas for basic life/accidental
death and dismemberment and long-term disability coverage. Staff recommends
renewing the basic life/AD&D and LTD bid with BCBS of Texas; the rate increase is
8.6% or $4,482 annually. There are no revisions to the existing benefit terms. In
2013, the City began to offer a voluntary life insurance product employees could
purchase; BCBS of Texas offers a similar product.
A motion was made by Trustee Sonnier and seconded by Trustee Root to award a bid
for employee Life/AD&D/LTD insurance to Blue Cross/Blue Shield of Texas. MOTION
CARRIED.
Ayes: Chairperson Albanese, Trustees Austin, Root, Sonnier, and Guillot.
Noes: None.
6. ADJOURN
There being no further business a motion was made by Chairperson Albanese and
seconded by Trustee Root to adjourn the meeting at 6:42 p.m. MOTION CARRIED.
Ayes: Chairperson Albanese, Trustees Austin, Root, Sonnier, and Guillot.
Noes: None.
Dan Alban e, airperson
City of Nederland Employee Benefits Trust
ATTEST:
Talmadge Austin, Secretary
City of Nederland Employee Benefits Trust
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