Loading...
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).