Item 4E ITEM 4E
CITY OF
SOUTHLAKE
MEMORANDUM
July 26, 2017
TO: Shana Yelverton, City Manager
FROM: Stacey Black, Director of Human Resources
SUBJECT: Approve a contract renewal with Aetna to provide employee health
insurance benefits for Plan Year October 1, 2017 through September 30,
2018.
Action
Requested: Approve a contract renewal with Aetna to provide employee health
insurance benefits for Plan Year October 1, 2017 to September 30,
2018.
Background
Information: In June, the City received its health insurance renewal from Aetna, the
current health insurance provider. Aetna's renewal proposed a 3%
rate increase with no benefit changes.
Aetna offers three plan options: a "base" EPO plan, "buy-down" High
Deductible HSA Plan, and a "buy-up" POS Plan. The table below
provides a brief comparison of the plans offered.
HDHP HSA EPO POS
Ded. + 10% $30 Office Visit $25 Office Visit
Office Visit Copay Copay
90% 70% 80%
Coinsurance Coinsurance Coinsurance
$3,000 $1,500 $1,000
Indv. Deductible Indv. Deductible Indv. Deductible
$6,000 $5,000 $3,000
Individual Out Individual Out Individual Out
of Pocket Max of Pocket Max of Pocket Max
(incl.deductible) (incl.deductible) (incl.deductible)
Aetna became the City's health insurance provider on October 1, 2016
following a competitive bidding process. The City's experience with
Aetna has been favorable and very few service complaints have been
Shana Yelverton, City Manager ITEM 4E
July 26, 2017
Page 2
received from employees. After a review of the claims data and given
the favorable experience, Staff recommends Council approve the
proposed renewal.
Financial
Considerations: The estimated annual cost of health insurance premiums is $2,959,265
for the City's portion of the premiums. The total If the contract renewal
is approved, the annual estimated increase is $60,974 for FY 2018.
The proposed health insurance plan costs will be included in the
proposed budget for Fiscal Year 2018.
Strategic Link: Performance Management and Service Delivery: attract, develop and
retain a skilled workforce.
Citizen Input/
Board Review: N/A
Legal Review: N/A
Alternatives: Deny contract with Aetna and seek alternative options.
Supporting
Documents: The following supporting documents are attached:
• Aetna Renewal
Staff
Recommendation: Approve a contract with Aetna to provide employee health insurance
benefits for Plan Year October 1 , 2017 to September 30, 2018.
A Renewal
Presented to
City Of Southlake
Financial Renewal Overview:
October 01 , 2017 through September 30, 2018
Control Number - 229323
t tT-
M �
I
Catherine Walsh
MMA Sr Account Manager
2777 Stemmons Freeway
Dallas,TX 75207
Phone:214-200-8550
Fax:214-200-8916
June 2, 2017 WaIShC1(a)aetna.com
City Of Southlake
Stacey Black
1400 Main St, Ste 260
Southlake, TX 76092
Dear Ms. Black:
Thank you for allowing us to serve your health insurance and health benefit needs over the past year.
We are hopeful that this package will provide you with the information you need in order to develop your
company's future benefits program.
As we approach the October anniversary of your program with our company,we are pleased to present
you with our renewal for the 2017 policy period.
We believe it is fundamental that you understand the full financial picture of your benefit plan.
Therefore,the enclosed package provides the following important information about the cost of your current
program and the value that Aetna brings to you and your company.
■ Future Program Costs
This section illustrates the cost projections to operate your current benefit program for the
period 10/1/2017 through 9/30/2018.
■ Fully Insured Medical Plans
For the period 10/1/2017 through 9/30/2018 the cost to operate your current Medical plans will increase
3.0%compared to the current rate.
This increase reflects both the Aetna premium and the producer service fee.
■ Caveats
Our renewal offer is contingent upon the parameters outlined here. It is important to note that
deviations from these assumptions may result in additional charges and/or adjustments on our
Medical quotations. Please review this section thoroughly.
In the absence of any changes impacting the conditions of this renewal as outlined in our Caveats
section,the rates will remain in effect through September 30, 2018.
If you would like to make any plan changes, please contact me by September 01, 2017. If you have any questions,
please contact me at 214-200-8550. It has been a pleasure working with you and I look forward to working with
you in the future.
Sincerely,
Catherine Walsh Saima Ghani
MMA Sr Account Manager LG Sr Underwriter
Each insurer has sole financial responsibility for its own products.
Health benefits and health insurance plans contain limitations and exclusions.
Policy form numbers include GR-9/GR-9N,GR-23,GR-29/GR-29N,GR-700-W,and/or GR-88435.
City Of Southlake
Experience Exhibit
Effective 10/1/2017
Control Number229323
•This exhibit displays the historical experience used in the development ofthe rates.
•Claims displayed are incurred claims and have been completed.
•Claims experience includes National Advantage Program access fees(for savings achieved on covered claims with
non-network providers and on high dollar,in-network facility claims).
•This exhibit may include information from other carriers.
Current Year's Experience
Total Medical
Month Members Premium FFS/Caps Rx Claims
201602 631 $268,231 $572,072 $147,147
201603 628 $269,064 $209,965 $53,871
201604 630 $270,058 $114,320 $29,184
201605 626 $269,986 $113,356 $28,792
201606 633 $273,592 $153,694 $38,839
201607 637 $274,059 $162,284 $40,801
201608 636 $272,335 $135,277 $33,836
201609 623 $268,738 $134,343 $33,256
201610 619 $282,955 $104,679 $33,356
201611 627 $286,820 $121,396 $57,193
201612 633 $290,102 $91,201 $60,979
201701 628 $287,755 $106,277 $59,880
TOTALS 7,551 $3,313,694 $2,018,862 $617,134
Current Year Incurred Claims PMPM $267.36 $81.73
Prior Year's Experience
Total Medical
Month Members Premium FFS/Caps Rx Claims
201502 608 $258,217 $109,408 $28,212
201503 613 $258,742 $141,421 $36,467
201504 618 $259,616 $184,177 $47,492
201505 606 $255,450 $122,908 $31,693
201506 608 $257,033 $158,863 $40,965
201507 598 $251,508 $114,408 $29,502
201508 599 $252,841 $238,078 $61,391
201509 605 $255,699 $119,523 $30,821
201510 618 $272,213 $164,615 $42,448
201511 620 $272,352 $199,044 $51,326
201512 623 $273,707 $150,389 $38,779
201601 619 $264,731 $84,503 $21,790
TOTALS 7,335 $3,132,109 $1,787,337 $460,886
Prior Year Incurred Claims PMPM $243.67 $62.83
Premium Development
Current Monthly Amount Due $294,199
Current Subscribers 300
Current Members 639
Current Total Amount Due PMPM $460.40
Includes Producer Service Fee 4.20
Current Premium PMPM $441.07
Rate Change Development for
City Of Southlake
Effective 101112017
•The components of your renewal rate change are detailed below.
•The current Net Adjusted Incurred Claims Per Member Per Month(PMPM)are trended Nrward to the Renewal Rate Period.
•Based on customersrze by experience rating group,calms Duero .it threshold are removed to normal-the
almeexperience In end"to
mize large yeady fluctuations.
•A large claim adjustment is added to the Incurred Claims PMPM,and blended with Manual Claims PMPM,if
applicable,to develop a blended expected claim PMPM.An adjustment for renewal benefit change is added if applicable.
•State taxes,commissions and other adjustments are then added resulting in the final required premium PMPM.
•This exhibit may arde information from other tamers.
Next contract Period. 10/1201]- 9/30/2018 Prior Year Experience Cul Year Ex rience
Experience Grouping'. Experience croup 1 Claim Basis: incurred incurred
Current Subscribers: 300 Year Experience Period. 2/1/2015-1/31/2016 2/12016-1/31201]
Current Members: 639 Paid Through. 3/31/201] 3/31201]
SubscriberMonths: 3,618 3,620
Member Month s: ]335 ]551
Experience Period Average Members:#VALUEI 629
Prior YearE rienceCun'ent YearE rience
Medical Rx Total Medical Rx Total
PMPM PMPM PMPM PMPM PMPM PMPM
1Incurred Claims $243.6] $62.83 $30651 $26]36 $81]3 $34909
2 Deductible Supression 0.882] 0.8940
3 Incurred Claims x Deductible Suppression Factor $21509 $62.83 $2]]93 $2 39 03 $81]3 $320]6
4 Pooled Claims $2023 $2023 $0.00 $0.00
5 Pooling Charge
a.Pooling Point $200,000 $200,000 $200,000 $200,000
b.Pooling Factor(medical claims only) ].]8% ].]8% ].]8% ].]8%
c.Pooling Charge $15.16 $15.16 $1859 $1859
6lncurred Claims w/Pooling(3-4+5c) $210.02 $62.83 $2]285 $25]03 $81]3 $33936
7 Adjustnent for Change in Network 09996 09998 09997 09999
8 Adjustment for Change in Plan 09016 09014 09041 09209
9 Adjustment for Change in Demographics 1.0218 1.0303 1.0218 1.0303
10 Underwriting Adjustment 1.0000 1.0000 1.0000 1.0000
11 Adjusted Incurred Claims(6x]x 8.9 x 10) $19341 $5835 $251]6 $23]92 $]]54 $31546
12 Trend
a.Annual Trend Factor 9.79% 14.]0% 9.79% 14.]0%
b.#of Months ofTrend 32.0 32.0 20.0 20.0
c.Projection Factor 1282] 14416 1.1684 12568
13 Exp.Based on
Claims(11 x 12c) $248.09 $84.12 $33220 $2]]98 $9]45 $37543
14 Experience Weighting 25% 25% 25% 75% 75% 75%
Blended Results
Medical Rx Total
15 Experience Blended Projected Claims $270 51 $94.12 $364.62
16 Experience Credibility 91.7% 91.7% 91.7%
1]Manual(CRC)Projected Claims $295]6 $]6.11 $3]1.86
18 Blended Projected Claims $2]2.61 $92.62 $36523
19 Large Claim Adjustment $0.00
20 Retention Charges Total Tote)
a.Administrative Component 1]25% $]836
b.Broker Commission Component 0.00% $0.00
c.Premium Tax Component 0.00% $0.00
d.H ealth l ns
Providers Fee 236% $10]3
e.Total Retention Charges(a+b+c+d) 19.61% $89.10
21Projected Premium $454 32
22 Multi Product Discount $0.00
23 Rate Adjustment $0.00
24 Proposed Premium $454.32
25 Producer Services Fee Component 42% $1992
26 Total Amount Due $474.24
27Estimated Currant Total Amount Due $46040
28 Required Rate Change(exdndes22&23) 3.0'/O
29 Proposed Rate Chane 26/2]-1 3.0'/O
City Of Southlake
Contact Information
Account Manager: Catherine Walsh Email: WaIshC1 @aetna.com
Telephone Number: 214-200-8550 Fax: 214-200-8916
Assumptions
Contract State: TX Lives: 300
Medical Pooling Level: $200,000 Sic Code: 9111
Producer Service Fee: 4.20% Mem/EE Ratio: 2.13
Control Number: 229323
'Health Insurance
Provider Fee%: 2.36%
Proposed Rates Effective Date: October 1,2017 End Date: September 30,2018
The Medical Pooling Level indicated in the assumptions above represents what was used in your pricing based on company
standards for your market and case size. This may be subject to change.
Total Amount Due Includes 4.2%Producer Service Fee*
Coverage Lives Current Rates Proposed Rates % Change
OAMC HDHP
EE 27 $465.45 $479.28 3.0%
EE+ SP 5 $1,037.97 $1,068.81 3.0%
EE+ Children 5 $916.95 $944.20 3.0%
Family 6 $1,522.04 $1,567.26 3.0%
Total 43 $31,473.99 $32,409.17 3.0%
EPO
EE 87 $555.59 $572.37 3.0%
EE+ SP 16 $1,238.97 $1,276.38 3.0%
EE+ Children 69 $1,094.50 $1,127.55 3.0%
Family 37 $1,816.76 $1,871.62 3.0%
Total 209 $210,900.47 $217,269.16 3.0%
OAMC
EE 27 $621.02 $639.45 3.0%
EE+ SP 8 $1,384.88 $1,425.98 3.0%
EE+ Children 3 $1,223.42 $1,259.73 3.0%
Family 10 $2,030.74 $2,091.01 3.0%
Total 48 $51,824.24 $53,362.28 3.0%
Total Medical Lives 300
Current Monthly Total Amount Due $294,198.70
Proposed Monthly Total Amount Due $303,040.61
Total % Change 3.0%
Proposed Annual Total Amount Due $3,636,487.32
*The proposed rates includes our premium and Producer Service Fee as requested. Producer Service Fee will be removed from Total Amount
Due if Policyholder and/or Producer do not elect our company to serve as billing and collection agent.Total Amount Due will reflect executed
Billing&Collection Agreement.
'The Affordable Care Act imposes two new fees/assessments,the transitional reinsurance contribution and the health insurance provider
fee.The fees were effective as of January 1,2014. This rate quote includes,where permitted,an estimated proportionate allocation of
expenses associated with these fees.Starting with January 1,2017 effective dates,the Reinsurance Contribution no longer applies.
City Of Southlake
Proposed Plan Designs -Fully Insured Funding Effective Date: October 01,2017
`Aetna Premier Formulary
Offers moderate savings and control.All generics are preferred plus more brands per class. Includes proven pharmacy management
techniques like precertification and step therapy. Customers can choose between Transition of Coverage or Transition Fill. Specialty drugs
must be filled at our Specialty Pharmacy Network. Coverage includes select over-the-counter drugs and certain formulary exclusions apply.
Some programs may not be available based on state regulations.
Covered drug lists can be found at:www.aetna.com/formulary
•Aetna standard policies and provisions will apply to all benefits not outlined above.
City Of Southlake
Programs and Services-Fully Insured Effective Date:October 01,2017
Program Summary
OAMC EPO OAMC
HDHP
Program/Service
Aetna Health Connections-Disease Management- Yes Yes Yes
Disease Management" Yes Yes Yes
MedQuery®with Member Messaging Yes Yes Yes
Aetna Navigator- Yes Yes Yes
Aetna's CareEngine-Powered PHR Yes Yes Yes
Beginning Right—Maternity Program Yes Yes Yes
Chronic Kidney Disease Program Yes Yes Yes
Health History Report Yes Yes Yes
24/7 Nurse Line-Informed Health Line Yes Yes Yes
Enhanced Clinical Review Yes Yes Yes
Simple Steps to a Healthier Life Yes Yes Yes
Teladoc® Yes Yes Yes
Aetna Vision"Discount Program Yes Yes Yes
Program Description
Programs/Services Description Cost
Aetna Health Connections- Unique and powerful disease management program supporting more than 35 chronic Included
Disease Management" conditions.Integrated and personalized patented technology allows Aetna to tailor each
member's interactions based on health and disease states,benefit plan coverage and personal
preferences.The Simple Steps online health assessment and Personal Health Record are
also integrated with our disease management program.
MedQuery®with Our program also includes MedQuery®with Member Messaging. MedQuery®with Member
Member Messaging Messaging is a program that uses medical claims,pharmacy claims and lab result values at a
member level,compares that against complex algorithms developed from evidence-based
standards of care to identify potential gaps in care called Care Considerations and provides
F the care considerations to physicians and members to help them improve their patients'care.
Members receive Care Consideration via letter by using the address provided by the health
plan(or employer self-insured health plan). The letter encourages the member to call his or her
doctor to discuss the Care Consideration.
Personal Health Record This online report combines detailed,claims-driven information gathered from across the Included
health care spectrum-such as physician offices,labs,diagnostic treatment and
pharmacies-with user-entered information such as family history or allergies. The result is
a health profile that the member can access anytime online,and print to share with his or
her doctor.
Beginning Right—Maternity Provides services,information and resources to help improve pregnancy outcomes.Nurse Included
Program outreach to physician for high risk members.Rewards for program completion are also
available:Mayo Guide to Healthy Pregnancy sent with completion of the Pregnancy Risk
Survey before the 16th week,baby blanket and growth chart sent when high risk outcome is
complete.
Chronic Kidney Disease Aetna and Fresenius Medical Care(Fresenius)have launched a CKD program aimed at improv- Included
(CKD)Program ing clinical outcomes and reducing medical costs by slowing the progression of chronic kidney
disease in members and facilitating gentler,less costly transitions to dialysis or pre-transplant
care. This voluntary program may include the following tools and services,telemonitoring
equipment,support from a kidney health care management team,coordination with a doctor,
24-hour access to a kidney nurse and personalized information.
Health History Report The Health History Report provides a centralized summary of a member's health-related Included
activity,such as doctor visits,tests,treatments,and prescriptions for medications.
This information is preloaded and updates automatically based on claims data,without any
effort by the member. It can then be organized according to health-related category,such as
names of doctors,medical care,prescription drugs,dental care and health assessment.
Aetna Navigator—subscribers may also view Health History Reports of their dependents covered
under their Aetna medical plan policy,subject to applicable state and federal
privacy laws and regulations.
24/7 Nurse Line- 24-hour nurse 1-800 support line-Members can call anytime and talk to a registered nurse Included
Informed Health°Line for answers to health related questions. They can also listen to information from our audio
health library on thousands of topics.
Enhanced Clinical Review Aetna's Enhanced Clinical Review Program can limit the financial impact of high cost radiology Included
services,diagnostic cardiology,sleep management studies,hip and knee arthroplasties and
cardiac rhythm implant devices by coordinating information provided by the ordering doctor.
The information is reviewed by board-certified specialists,specialized registered nurses,and
physicians to maximize savings on these high cost services. Plan sponsors can expect to see
an estimated savings of$1.50 to$1.90 PMPM savings with this program.
Simple Steps to a Healthier A personalized online health and wellness program that begins with completing a health Included
Life° assessment. Upon completing the health assessment,the participant receives a Health
Summary Report to keep and record their results over time,which can also be printed and
shared with a health care provider. Based on information gathered in the health assessment,
the participant receives a personalized HealthMap,containing online coaching program
recommendations to help them achieve and maintain good health. The Health Assessment also
is designed to assess participants'level of health risks,their readiness to change certain
health behaviors and their impact of health on productivity. Plan Sponsors have access to
aggregate results and can utilize information to design a wellness program and measure the
success of the programs.
Teladoc® Teladoc®is a national network of board-certified physicians who provide quality health care Included
to members through the convenience of phone or online video consultations.Teladoc
physicians can diagnose,treat and write prescriptions for routine medical conditions.
Benefits of Teladoc®include:
The convenience of 24/7 access online or by phone
Reduction in absenteeism and increased productivity
Less time spent away from work
Increased employee satisfaction
Lower claim costs
Our standard implementation allows Teladoc®to verify eligibility directly with our systems.
Teladoc®will submit a claim charge for each consultation. The member's coinsurance or
deductible will be applied when appropriate. Charges for consults will be submitted as any
other medical claim and processed through the claims system. The member's cost share
is the same as a physician office visit. In some cases,a custom member cost share can be
implemented. In these custom cost share cases,updated eligibility files are provided to
Teladoc at least monthly.
Teladoc°operates subject to state regulations:
• Not available for HMO-based plans in New Jersey
Teladoc°is temporarily suspended in Arkansas due to state regulatory considerations.
Aetna Vision"Discount The Aetna Visions"Discount Program helps members save on many eye care services and Included
Program products,including eye exams,LASIK surgery,eyeglasses,contact lenses,nonprescription
sunglasses,contact lens solutions and other eye care accessories--at no additional premium
cost.
Aetna Healthy Commitments'"Program Cost
Premier Wellness Package has been included in our offering. Please refer to the Aetna Healthy Commitments"Packages Included
section included within this proposal.
Choose Generics Cost
Choose Generics promotes the use of clinically-effective,cost-saving generic drugs. If a generic is available and a brand- Included
name drug is dispensed,the member always pays their applicable copay plus the difference in cost between the brand and
generic drug.
NAP Flex Cost
Your plan and your employees can save money with the Facility Charge Review(FCR)and Itemized Bill Review(IBR) Included
components of Aetna's National Advantage—Program(NAP).FCR provides reasonable charge allowance review for most
inpatient and outpatient out-of-network facility claims. IBR's review of large facility charges which meet certain criteria
(including certain in-network,inpatient claims)often results in eliminating certain types of charges prior to claim adjudication.
These programs not only save money on eligible claims for your plan but also can help your employees see lower co-
insurance and deductible charges. In addition,the Contracted Rate component of NAP provides similar benefits when
members receive out-of-network services involuntarily(e.g.,emergencies). The claim experience shown below for your
uoted products also includes NAP access fees which area percentage of NAP savings achieved).
Step Therapy Cost
Step therapy promotes the appropriate use of equally effective but lower-cost medications first. For any given condition, Included
there are many therapy choices.We help members navigate their choices and find the most effective option,by starting with
prerequisite medications. Trying one or more prerequisite medications is required before a step-therapy medication will be
covered.Prerequisite medications are FDA-approved and treat the same condition as the corresponding step-therapy
medications. Members currently taking a step therapy medication should contact their physician and ask for an equivalent
medication that does not require step therapy. The prescriber can ask for exception if it is medically necessary to use a
medication on the step-therapy list.
24/7 Call Service Cost
In addition to the robust suite of technology resources that we offer members,members can speak with a customer service Included
representative for our middle market medical plans 24 hours per day,7 days per week(24/7).Representatives are able
to assist members at any time,day or night.The service is available every day except select holidays.
Employer Representation
Aetna medical products are underwritten by:
Aetna Life Insurance Company
Application attachment when selecting any HSA-compatible plan(s).
Name of Employer Group: City Of Southlake
Policy Holder Number(s): 229323
Employer Representation
I have selected the HSA-compatible high deductible health plan described in the application tc
which this representation is attached. I understand that, in determining the premium to be
charged for this plan, Aetna has assumed or will assume that the deductible will be funded only
by payments from the HSA or by the member, and that I will not create or purchase a separate
arrangement or policy to fund the payment of all or any portion of the deductible
I further agree that, in the event I create or purchase a separate arrangement or policy to func
the payment of all or any portion of the deductible, I will notify Aetna, and Aetna reserves an(
has the right to adjust the premiums that are due for this policy. Failure to communicate this
information may result in premium adjustments, retroactive premium adjustments and/or
termination.
Company Officer Signature Print Name
Title Date
GR-68528 (3-09)
Aetna Healthy Commitments"-Premier Package
City Of Southlake
Aetna Healthy Commitments-Fully Insured Funding Effective Date:October 01,2017
Wellness Programs Included to Help Members Stay Healthy and Improve Productivity
We believe that a workplace wellness strategy is essential to successfully motivate subscribers and sustain engagement in their health and well
being. The Aetna Healthy Commitments program is designed to help improve our members'overall health by offering easy access to an online
health assessment,Online Wellness Programs,online self-help tools,onsite biometric screenings,and a variety of member incentives.
Healthy Lifestyle Coaching
Outreach Telephonic Coaching focused on Telephone coaching and support from professional Health Coaches.Healthy Lifestyle Coaching
all categories covering areas such as tobacco (HLC)is a high-touch,all-inclusive,unlimited-session coaching program delivered by experienced
cessation,stress management,exercise& highly trained wellness coaches.It helps all members from low to high risk quit using tobacco
weight management manage their weight,deal more effectively with stress,learn about proper nutrition and physical
fitness,high risk reduction and preventive health. High risk members receive weekly phone
appointments with a coach for 12 months,moderate risk up to 8 calls and low-risk up to four calls.
Included are educational materials and if the member's goal is to get tobacco-free,we provide an
8-week supply of Nicotine Replacement Thera NRT.
Onsite Biometric Screenings
Quest Diagnostics We work with Quest Diagnostics to bring health screenings directly to the worksite to help
employees decrease their risk for health concerns.Fingerstick or Venipuncture options are
available as well as Fasting or Non Fasting screenings,all screening options offer a convenient
online scheduling system.Additional options for testing include Home Test Kits,Primary Care
Physician Results Forms,and Patient Service Centers(venipuncture only).
Results are generated by a single fingerstick test at the time of the event.A nurse will discuss
results and health risks to the participant at that time along with an online report through the Ques
scheduler.A minimum of 30 participants are required per event location.
Venipuncture
Blood draw performed on-site or at a patient service center and sent to the lab for processing.
Results are available online and mailed to the participant's home. The onsite Venipuncture
screenings require a minimum of 20 participants per event location.
Health Assessment(Supported by Incentives
Simple Steps To A Healthier Life®(SSHL) A personalized online health and wellness program that begins with completing a health assess-
Aetna's Health Assessment ment. Upon completing the health assessment,the participant receives a Health Summary Repor
to keep and record their results over time,which can also be printed and shared with a health
care provider. Based on information gathered in the health assessment,the participant receives
a personalized HealthMap,containing online coaching program recommendations to help them
achieve and maintain good health.The Health Assessment also is designed to assess partici-
pants'level of health risks,their readiness to change certain health behaviors and their impact of
health on productivity. Plan Sponsors have access to aggregate results and can utilize infor-
mation to design a wellness program and measure the success of the programs
SSHL Health Assessment Completion/Update Subscribers and their spouses can each earn a$50 gift card after completing both the Health
&Completion of One Online Health Coaching Assessment and a minimum of one Online Health Coaching Program Journey.
Program
Online Wellness Programs The Online Health Coaching Programs("Journeys")will personally invite subscribers who com-
plete their Compass Health Assessments to join the program most likely to appeal to them,based
on the information provided in their Health Assessments.Your subscribers will embark on a
Journey that is tailored to their unique needs& preferences. Journeys are developed to max-
imize engagement and positive outcomes through use of:
•Adaptive Technology
•Gaming Mechanics
•Proven behavior science methodology
Available programs include:Be Tobacco Free,Blood Pressure in Check,Diabetes Life,Eat
Healthier,Get Active,Healthy Back,Heart Healthy Cholesterol,Living Well with Asthma,Sleep
Well,Stress Less Weigh Less and Health In A Hurry
JAdvocacy&Outreach Pro rams
2417 Nurse Line-Informed Health Line 24-hour nurse 1-800 support line-Members can call anytime and talk to a registered nurse for
answers to health related questions. They can also listen to information from our audio health
library on thousands of topics.
Neighborhood Well-being Services Provides members easy access to face-to-face lifestyle and preventive coaching support in their
neighborhood CVS MinuteClinics.
Communications Campaigns and Toolkits
Member Wellness Message Program Electronic communications for employees that address general health and wellness topics,
available in English and Spanish.
Fitness Challenge with Social Networking
Get Active," Get Active,"is an online health and wellness program with a unique social approach that
encourages employees to connect with one another to reach their health goals.Plus,it's
powered by ShapeUp,Inc.,a leader in global social wellness solutions.
Get Active"is based on a year-round curriculum of fun team challenges.It uses online tools to
help participants charttheir progress.By motivating each other,employees get healthy together,
and your company can save money on health care costs.
Get Active•^^has three main components:
1. Self-assessment and goal setting:The Get Active•^^platform and online tools help
participants identify and set achievable health goals.Whether employees are
seasoned athletes or first-time exercisers,we help them define and reach their particular
goals.
2. Healthy challenges:Employees are invited to join quarterly team-based fitness challenges
focused on walking,exercise,nutrition and weight loss.
Challenges use the latest medical research and social gaming mechanics.Friendly
competitions focus on fitness,nutrition,lifestyle balance and preventive care.Weekly bonus
challenges focus on well-being.User-generated challenges keep engagement high among
participants.
3. Progress tracking and milestones:Our intuitive tracking interface allows participants to chart
progress towards healthy goals.Tracking is convenient and accessible to all employees.
Online Self-Help Tools
Aetna Navigator- A secure member website that is an online resource for personalized health and financial
information. Subscribers can access their personal health benefits,find claims status and
details,find cost of tests and medical visits,view health history report,receive wellnesE
discounts,take the health assessment,participate in the Online Wellness Programs,locate a
doctor,and self refer into available disease management programs and much more.
Health Decision Support Health Decision Support is an online training tool that helps members understand their conditions,
treatments,procedures and surgery options.
Healthwise®Knowledqebase This feature on Aetna Navigator-is a decision-support tool that gives members access to
powerful information resources in order to make better health decisions. Members have access
to clinical information on 1,900 health topics,600 medical tests and procedures,500 support
and 3,000 medications.
Preventive Health Care Schedule This informational schedule will guide members according to age and gender of preventive
screenings needed and steps to take to live a long and healthy life.
Aetna Discount Programs
Our discount program helps members save money on a wide variety of products and services
for themselves and their family. Members can save on gym memberships,weight loss programs,
eyeglasses,LASIK laser eye surgery,massage therapy and much more!
Re ortin
A variety of reports are available to plan sponsors via Navigator and Simple Steps,and may vary
based on participation levels.
This material is for information only.Health information programs provide general health information and are not a substitute for
diagnosis or treatment by a physician or other health care professional.Health benefits and health insurance plans contain
exclusions and limitations.Not all health services are covered.See plan documents for a complete description of benefits,
exclusions,limitations and conditions of coverage.Plan features and availability may vary by location and are subject to
change.The Aetna Personal Health Record should not be used as the sole source of information about the member's health
conditions or medical treatment.Discount programs provide access to discounted prices and are NOT insured benefits.The
member is responsible for the full cost of the discounted services.Information is believed to be accurate as of the production
date;however,it is subject to change.
For information about Innovation Health plans,refer to: www.innovation-health.com.
City Of Southlake
Caveats-Fully Insured Funding Effective Date: October 01,2017
Assumptions
Prospective Quoting
The quoted insured medical rates are offered on a prospectively rated basis. No policy year accounting balance will be
calculated for these coverages.
Billing and Payment of Premium
Amount due is payable on the first day of the month covered by the invoice.If the amount due is not paid in full within 30
days,we reserve the right to terminate the contract and/or assess late premium payment charges.
Commissions
Commissions have been excluded from our quoted rates.
Producer Service Fee
• Producer Service Fee of 4.2%of the total amount due as defined in the Billing and Collection agreement.
• Negotiated directly between Policyholder and Producer for services provided in connection with the Group
Medical benefit plan. Producer Service Fee is not a component of the premium but is included in the total
amount due. Producer Service Fee will be removed from Total Amount Due if Policyholder and/or Producer do
not elect our company to service as billing and collection agent. Total Amount Due will reflect executed Billing&
Collection Agreement.
Contract Period
Our policies provide for automatic renewal upon the completion of each contract period unless either party invokes the
termination provision requiring 31 days advance written notice of termination to the other party. This provision may be in-
voked at any time during the continuance of the contract(that is,not just limited to termination occurring on the renewal date).
Contributions
Our rates assume compliance with our standard guidelines on employer contribution strategy. We standardly require that the
employer contribute 75%of the employee cost,or 50%of the total employee and dependent cost. Employer contributions
may not favor other medical plans over that of the Aetna plans. Our plan will have neutral to favorable employer contributions
after adjusting for plan design,compared to other medical plans,including consumer directed plans(HRA and/or HSA
models). In option situations,employer contributions must not disadvantage our offering.
Eligibility
Eligibility applies to:
• Permanent full-time employees working 25 hours or more per week,on a regularly scheduled basis.
• Eligible dependents include an employee's spouse and children up to the limiting age of the plan or as mandated
by legislative requirement.
• Individuals cannot be covered as an employee and dependent under the same plan.
• Children eligible for coverage through both parents cannot be covered by both under the same plan.
Participation
For Full Replacement sales at least 75%of eligible employees excluding spousal and parental waivers must enroll in the plan,
but not less than 50%of all eligible employees regardless of spousal and parental waivers. For Option Sales at least 75%of
eligible employees excluding spousal and parental waivers must enroll in the employer's plans.
Financial Condition
Plan Sponsor is a legitimate business and meets underwriting approval for acceptable financial strength. We reserve the
right to request additional supporting information in order to evaluate financial status.
High Deductible Health Plan
We reserve the right to change the quoted rating for coverage,or to decline to offer coverage if the Plan Sponsor funds
the deductible in excess of 50%.
Mandates
Benefit provisions are subject to state,local,and federal mandates.Future mandates will be incorporated in the plan(s)as of
the date required by law and may require rate adjustments.
Medicare-based Out of Network Reimbursement
Please note your plan's out-of-network benefits. Your plan will cover out-of-network care based on what Medicare pays
doctors and hospitals for a service. Typically the allowed amount is-10 percent less than Medicare pays doctors and other
health care providers. It is 0 percent more than Medicare pays hospitals and other facilities. This helps to control rising
health-care costs.
Our Medicare-based payment generally is less than our previous payment for out-of-network services which was based
on prevailing charges. This means members will pay more if they choose to go out-of-network. This applies to out-of-
network doctors,behavioral health professionals,dentists,hospitals,ambulatory care centers,and other health care
providers and facilities.
This does not apply to emergency care. It also does not apply to services provided by out-of-network doctors working at
in-network facilities,such as radiologists,anesthesiologists and pathologists.
Plan Design
This renewal is based on the current benefit plan designs,plus any noted deviations. Our standard provisions,contract
wording and claim settlement practices will apply for items not specifically outlined.
Network Re-Contracting
In addition to standard fee-for-services rates,contracted rates with network providers may also be based on case and/o
per diem rates and in some circumstances,include risk-adjustment calculations,quality incentives,pay-for-performance an(
other incentive and adjustment mechanisms.These mechanisms may include payments to organizations that may refer b
themselves as accountable care organizations("ACOs")and patient-centered medical homes("PCMHs"),in the form o'
accountable care payments(ACP)and incentive arrangements based on clinical performance and cost-effectiveness.Th(
ACP amount is based upon an assessment for each member who is already accessing providers in an ACO,and is
assessed retrospectively on a quarterly basis and collected through established claim wire.Each ACO will have a differer
ACP based on the clinical efficiencies targeted and network negotiations.The ACP assists the ACO in funding transformatioi
of the health care system to improve quality,reduce costs and enhance the patient experience by
•Identifying and engaging patients at risk for health crises sooner through more data-sharinc
•Increasing patient engagement in best-in-class care management programs through doctor-driven outreaci
•Delivering better health outcomes through increased collaboration between the health plan and ACO provider:
We reserve the right to revise the premium or terminate if:
Member/Subscriber Ratio
The enrolled member to subscriber ratio increases or decreases by more than 10%from the 2.13 ratio assumed in this quote.
Enrollment
The actual enrollment in total or by plan changes by more than 10%compared with what was proposed.
The plan sponsor offers coverage to employee previously not covered under the plan without prior notification.
Participation and Contribution Rules
Under Affordable Care Act(ACA)and state insurance regulations,a group health insurance policy may be non-renewed for
certain reasons.We reserve the right to non-renew for failure to comply with certain requirements such as participation
and/or contribution rules.
Contract Provisions
The final benefit provisions,account structure,claim payment requirements or services change from those proposed.
Quoted Benefits
A material change in the plan of benefits offered,or a change in claim payment requirements or procedures,or a change in
state premium taxes or assessments,or any other changes affecting the manner or cost of providing coverage that is
required because of legislative or regulatory action.
Additional
Primary Care Physician Referrals
Because of certain provider contractual arrangements with some Independent Provider Associations(IPAs)and medical
groups,we will permit specific exemptions to the requirement that a member obtain a referral from their primary care
physician(PCP)before receiving care from other providers.
Federal Mental Health Parity
The Federal Mental Health Parity and Addiction Equity Act of 2008(MHPAEA) applies to fully-insured Traditional and HMO
Middle Market(MM),Public and Labor(P&L) &National Accounts(NA)commercial plans for plan years beginning on or after
October 3,2009. Please speak to your Account Manager if you would like additional information.
Medical EOBs
We make EOBs available through our secure Navigator website for subscribers who have registered to use Navigator and
for whom we have a valid email address. We send members an email when a new EOB is available. All other members
receive paper EOBs. If a member receiving EOBs electronically prefers paper EOBs,they can get them by telling us that is
their preference. Please note that unless required by state law we do not produce EOBs for claims when there is no
member liability.
Medical Disclosure Information
At the time of annual enrollment,your plan participants should be provided with the Medical Disclosure information related to
their plan of benefits.Go to our corporate website and enter the state followed by the word'Disclosure'in the search field
Please provide the applicable Medical Disclosure document and any required Addendum to your plan participants. If you have
any questions,please contact your broker or account management team.
State/Federal Mandates
Texas
Texas Optional Benefits Mandate
Texas state law requires insurers to offer plan sponsors the option of covering the following:
•In vitro fertilization
•Speech and hearing impairment therapies for children with developmental delay
•Home health care
•Non-serious mental illness
Should a plan sponsor decline to cover all or some of these benefits,they must notify Aetna in writing by using the TX
Rejection Form.
Health Care Reform Caveats
Healthcare Reform Disclosure
This renewal is intended to be compliant with health care reform.
March 23,2010,the Federal government released regulations related to grandfathering of health plans in existence under
the health care reform legislation,health plans existing prior to the enactment of the legislation may be"grandfathered"
and not subject to some of the mandated benefits and reform provisions. Changes in your benefit design as well as your
contribution strategy may affect grandfathering. Plan sponsors are required to notify us if their contribution rate changes
for a grandfathered plan at any point during the plan year.
This renewal offer assumes your plan is not grandfathered.
As a non-grandfathered plan,the plan will include Preventive care as defined by regulation without cost sharing on In Net-
work services.
This renewal includes the women's preventive care coverage requirements,e.g.,coverage for contraceptive methods and
counseling,breastfeeding support and equipment,and prenatal care.
Certain religious employers and organizations may be exempt from contraceptive services coverage requirements,or may be
eligible for a religious accommodation.If you qualify and want to be exempt from including ACA contraceptive services
benefits in your policy,please work with your Account Manager/Account Executive to provide the required documentation to
us so that we can administer accordingly. We have the right to treat insured plans as subject to the ACA contraceptive
services coverage requirements without an executed certification document.Applicable state laws requiring coverage of or
related to contraceptive services benefits still may apply.
Except for specific and limited scenarios described as transitional rules in the health care reform legislation,if a plan's grand-
fathered status has been lost,it cannot be regained. If,after reviewing the grandfathering rules with your benefit consultant
or counsel,your determine that your coverage could be or is grandfathered,and you want to retain grandfathered status,
please contact us for further instructions.
We reserve the right to treat an insured plan as non-grandfathered.
The Affordable Care Act(ACA)prohibits insured group health plans that are not grandfathered from discriminating in favor
of highly compensated employees as to benefits and eligibility. This rule will become effective after additional regulatory
guidance is issued in the future. Employer penalties for violating the rule include a$100 per day penalty multiplied by the
number of those individuals"discriminated against." If you think your plan may be discriminatory under ACA,we urge you to
monitor the rulemaking process and contact your benefits attorney or tax counsel for further guidance. We do not conduct
discrimination testing and are not responsible for an employer's compliance with this ACA non-discrimination rule.
The benefits and rates within this proposal are subject to change pending any required approvals or future guidance from
state or federal regulatory agencies. If you have questions,please contact your Account Executive.
We reserve the right to modify its products,services,rates and fees,in response to legislation,regulation or requests of
government authorities resulting in changes to plan benefits and to recoup any material fees,costs,assessments,or taxes
due to changes in the law even if no benefit or plan changes are mandated.
Retiree Only Plan Status Certification
Guidance issued by the Internal Revenue Service("IRS"),Department of Labor("DOL"),and Department of Health and
Human Services("HHS")has indicated that"retiree only"plans are exempt from the benefit mandates under ACA including
Medical Loss Ratio("MLR")and rebate requirements for insured plans(Retiree only plans are subject to certain ACA fees
and assessments). In order to demonstrate the establishment of a retiree only plan,a plan should maintain,separately from
the plan for current(i.e.,active)employees,a separate plan document and Summary Plan Description(SPD)and file a
separate Form 5500. If you have a retiree only plan,and want to be considered exempt,please provide the required
documentation to us. We have the right to treat insured plans as subject to ACA without an executed certification document.
Affordable Care Act—fees and assessments
The Affordable Care Act(ACA)imposed several fees/assessments,including the Health Insurance Provider Fee,the
Transitional Reinsurance Contribution and the Patient-Centered Outcomes Research Institute Fee.
• Health Insurance Providers Fee(HIF)is a recurring,annual,industry fee assessed based on each insurer's
share of the fully insured market,as determined by the IRS. A total of$11.3 billion will be collected across the
industry for 2016. The total assessment will increase each year,to an estimated$14.3 billion in 2018 and will
then increase at the rate of industry premium growth thereafter. The Omnibus Bill,signed into law on 12/18/15
includes a one year suspension of the HIF for calendar year 2017.HIF will be reinstated for calendar year 2018.
• Transitional Reinsurance Contribution—This assessment is in effect from January 1,2014 through December 31,
2016 and will no longer apply as of January 1,2017.
• Patient-Centered Outcomes Research Institute Fee(PCORI)—This fee is in effect for plans or policy year ending
after September 30,2012,and before October 1,2019.
This rate quote includes,as applicable,an estimated proportionate allocation of expense associated with the Health
Insurance Provider Fee and the Patient-Centered Outcomes Research Institute Fee.We reserve the right to modify these
rates,or otherwise recoup such fees,based on future regulatory guidance,subsequent state regulatory approval,or if
estimates are materially insufficient.
Member Out of Pocket Limit
For non-grandfathered plans renewing on or after January 1,2014,all in-network medical,behavioral health,and pharmacy
member cost sharing,which includes all copays,coinsurance and deductibles,must apply to a member's out-of pocket(OOP)
maximums.The OOP maximum limit cannot exceed the limits set by the Department of Health and Human Services,or under
the tax law for high deductible health plans paired with Health Savings Accounts(HSAs).
For non-grandfathered plans renewing on or after January 1,2016,an individual members OOP maximum cannot exceed the
individual limit set by the Department of Health and Human Services. This is regardless of whether the individual is enrolled i
self-only coverage or non-self only(family)coverage.
A plan may maintain separate OOP maximums for different benefit categories,as long as the combined totals do not exceed
the statutory limit.For plans renewing on or after January 1,2015 plans will have two options to maintain compliance:
• Integrated medical and pharmacy OOP maximum that does not exceed the statutory limit
• Non-integrated medical and pharmacy OOP maximums that collectively do not exceed the statutory limit—this
option is not available for high deductible health plans paired with HSAs
We recommend that you review your pharmacy OOP maximum to ensure compliance.Please contact your Aetna Account
Executive to inform us of any required changes that you will make to these plans to ensure compliance or with questions on
this requirement.
High deductible health plans paired with HSAs are still required to integrate all accumulators for medical,behavioral health an
pharmacy benefits. Integration support is not available for fully insured business.
The rates provided may include an adjustment in order to bring your plan into compliance with the member payment limit
requirements.
Waiting Period Requirement
When renewing your plan(s)with us,you represent that:
• You will give us effective dates for your employees and their dependents that take into account all state and
federal eligibility conditions and waiting period requirements,including a reasonable and bona fide orientation
period.
• If this information changes,you will inform us immediately.
Essential Health Benefits
The ACA prohibits the application of annual dollar limits for any Essential Health Benefits for all plans effective on or after
January 1,2014(the prohibition of lifetime dollar limits on Essential Health Benefits has been in effect since 2010). To the
extent that your current benefit plan includes such limits,this renewal includes the removal of those limits.
Summaries of Benefits and Coverage(SBC)
For applicable plans and policies with effective dates of January 1,2014,and later,the SBC must include statements about
whether the plan or coverage provides minimum essential coverage(MEC)and if the coverage meets minimum value(MV)
requirements.
Under the Affordable Care Act(ACA),minimum value and minimum essential coverage determinations are associated with
the employer shared responsibility provisions.We will review the minimum value standard for each plan based on the MV
calculator criteria provided by the Department of Health and Human Services(HHS)and will indicate within the SBC whether
the plan meets or does not meet the MV standard based on this review.We do not provide legal or tax advice,and
recommend that plan sponsors consult with their own legal and tax counselors when reviewing MEC and MV
determinations.We have no responsibility or liability regarding the minimum value or minimum essential coverage evaluation,
regardless of the role we may have played in reviewing/producing the SBC documents.To the extent you disagree with our
evaluation,we will make changes to reflect your determination,as you are responsible for the final determination of these
SBC elements.
HIPAA Certificates of Creditable Coverage
After 12/31/14,non-excepted health plans are no longer required to issue HIPAA Certificates of Creditable Coverage.The
certificates are no longer needed because,for plan years on or after 1/1/14,insurers are prohibited from imposing pre-
existing condition exclusions under the Affordable Care Act. Final rules have amended the HIPAA provision that required
these certificates to reduce pre-existing condition periods for new enrollees in plans.As a result,we will not produce and
distribute HIPAA Certificates of Credible Coverage as of 1/1/15.
Employer Reporting Requirements
Under Internal Revenue Code(IRC)Section 6055 health insurance issuers,certain employers,government agencies and
other entities that provide Minimum Essential Coverage(MEC)to individuals must report to the IRS information about the type
and period of coverage and furnish related statements to covered individuals.This information is used by the IRS to administe
the individual shared responsibility provision and by individuals to show compliance with the individual shared responsibility
provision.
For insured group health plans,the reporting obligation under Section 6055 is our responsibility. We will report the required
information to the IRS about the type and period of coverage provided to each individual member enrolled in our insured plans
and will furnish the required statements to subscribers.We will send these statements either by first class mail.
We must report the entire Social Security numbers(SSN)to the IRS for each sub-
scriber and dependent in order to complete our required reporting. However,the final rules allow the use of truncated social
security numbers on statements furnished to individuals(for example,give only the last four digits of the SSN). If we don't
receive the SSN through the employer,the law requires we reach out to each subscriber up to three separate times to
request the information.
IRC Section 6056 requires applicable large employers(those having employed an average of 50 or more full-time employees
during the preceding calendar year)to report to the IRS information about the health care coverage they have offered and
also furnish applicable statements to employees. The purpose is to allow the IRS to enforce the employer responsibility
provisions.
To satisfy the 6056 employer reporting requirements,an applicable large employer must file the required returns with the IRS
by no later than February 28 of the year following coverage(if filing on paper)or March 31 (if filing electronically),and
furnish a statement to all full-time employees by January 31 st of the year following the calendar year to which the return
relates(i.e.,January 31,2016 for the 2015 calendar year).