PRM Health Trust FY 19-20 One Boca Place 561-995-6708
2255 Glades Road I Suite 200E www.ajg.com
Boca Raton,FL 33431
Gallagher USA
Insurance Risk Management I Consulting
July 26,2019
India Riedel
Finance Director
City of Okeechobee
55 SE 3rd Avenue
Okeechobee, FL 34974
Re: Group Health Rates for Plan Year 2019-2020
Dear India,
We are pleased to provide you with your Group Health rates for the new plan year beginning October 1, 2019. The
rates illustrated below represent an increase of 6.7% over your current medical rates. The increase in the medical
rate is 2%higher than the pool average due to a loss ratio of 110.3%. There was a decrease in the Dental rates
and no change to the Vision, Life or Disability rates. We believe that you will find this renewal very reasonable in
light of current market conditions.
Medical—PRM Plan PPO 0727
Funding Rates
Coverage Medical Medical COBRA Medical Reduced
Retiree
Employee $850.70 $867.71 $647.32
Additional for Spouse $1,273.11 $1,298.57 $891.16
Additional for Child $847.55 $864.50 N/A
Additional for Family $1,858.25 $1,895.42 N/A
Medical—PRM BlueOptions 05901
Funding Rates
Coverage Medical Medical COBRA Medical Reduced
Retiree
Employee $669.40 $682.79 $509.28
Additional for Spouse $1,001.76 $1,021.80 $701.18
Additional for Child $666.85 $680.19 N/A
Additional for Family $1,462.17 $1,491.41 N/A
Dental
High PPO Low PPO
Coverage Funding Rate Funding Rate
Employee $33.99 $27.19
Employee Family $88.70 $70.97
Page 2
Vision
NVA,Voluntary
Coverage Funding Rate
Employee $5.24
Employee Spouse $9.83
Employee Child(ren) $8.18
Employee Family $16.19
Basic Life
Coverage Funding Rate
Basic Life per$1,000 $0.32
Basic AD&D per$1,000 $0.02
Voluntary Life
Coverage Funding Rate
Voluntary Life per$1,000 Age Rated
Voluntary Spouse Life per$1,000 Age Rated
Voluntary AD&D per$1,000 $0.03
Voluntary Child Life $2.00
Disability
Coverage Funding Rate:
Short Term Disability-Voluntary $0.37
Long Term Disability—Non-Contributory $0.61
We appreciate the opportunity to serve you and your employees and look forward to working with you over the new
plan year.
Should you have any questions, please contact Yvonne Blackford or me at 561-995-6706,
Sincer ,
Paul Hebert
Area Senior Vice President
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F cf,„_ Exhibit 4
1 •!24' �y °et City of Okeechobee July 16, 2019
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i Memo
Date: for July 16 meeting
TO: Mayor and City Council
FR: Admin Marco Montes De Oca and India Riedel, Finance
Dept
RE: PRM Group Health Insurance
The City's current premium structure for plan 0727:
Employee Only $ 797.29 Empl & Spouse $1,990.46
Empl & child(ren) $1,591.62 Empl Family $2,538.86
The City has had another year of large payout of benefits for our
employees and dependents. ($110.00 paid out for every $100.00
premium (apprx $67,000), based on the months used for renewal
rates. As per the bylaws of the PRM group the maximum premiums
will increase is 6% over the Group. The Group (PRM members)
experience base rating is @ a 4.7% increase effective 10/01/2019.
PRM and the broker Arthur J. Gallagher have provided an additional
1% decreased (already included in percentages) based on the Board
of directors (us), approval to renegotiate contracts with
Pharmaceuticals. This is one of the strong points of being within a
pool the members have control of.
The city's claims experience rating is higher than the groups average
of 4.7%, therefore the current PPO 0727 plan premium increase for
this fiscal year is at 6.7%, or a $41,670 increase.
The city is continuing to take a long term approach regarding the
health of its employees by continuing the current benefits including
the Clinic. (Currently a 2 year contract without an increase for
2019/2020 FY)
1I
PPIFPF- City of Okeechobee
Memo
Current plan, 0727
City Cost Deduction
Premium Per Employee per
per Month Employee
Pay Check
Employee Only $850.70 $850.7 $0.00
Add'l for Spouse $1,273.11 $150.00 $518.35
Add'I for Child (ern) $847.55 $150.00 $321.94
Add'l for Family $1858.25 $150.00 $788.42
Affordable Care Act required option, 05901
City Cost Deduction
Premium Per Employee per
per Month Employee
Pay Check
Employee Only $669.40 $669.40 $0.00
Add'I for Spouse $1,001.76 $150.00 $393.12
Add'l for Child (ern) $666.85 $150.00 $238.54
Add'I for Family $1,462.17 $150.00 $605.61
2
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FLORIDA * Faueided 1415
PRM Health Trust and
City of Okeechobee
Paul Hebert and Katrina Bouthot I July 16, 2019
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About PRM Health Trust Gallagher
Insurance Risk Management Consulting
The City of Okeechobee joined effective August 1 , 2010
• Health Trust established in December 1989
• Has grown from 7 members to 55 member as of July 2019
• Formed pursuant to an Interlocal Governmental Cooperative
Agreement under Florida Statute §112.08
• Each Health Trust Member names a Board Member who has 1
vote on the Health Trust Board
• The PRM Health Trust has a surplus of approximately $21 million
as of September 30, 2018
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F u n d i n g Status Gallagher
V Insurance I Risk Management Consulting
Low Administrative Expenses allow for richer benefits
The PRM Health Trust is self-insured. Funding is used to pay the
administrative costs of operating the Health Trust and to pay the
claims incurred by the participating employees and their family
members, with no profit margin.
0% 1% 1% 0%
4% �l. 0%
6%
W Net Paid Claims
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u Specific Premium @$300,000
w Aggregate Premium
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Medical Rates Gallagher
Insurance Risk Management Consulting
PRM's renewal methodology provides for rate caps
• Gallagher is the broker/consultant for the Health Trust and sets
"premium equivalent" rates each year for each member
The premium rates are fixed for the full plan year so the program
feels like a fully insured program
The City would never be asked for additional dollars to make up for a
funding shortfall
• Gallagher determines a Pool Average — which is the average
increase needed to meet projected claims and expenses for the
upcoming plan year
For employers that have been in the Health Trust 3 years or more, the
renewal is based on a deviation schedule tied to the Pool Average,
with a maximum deviation (up or down) of 6%
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City of Okeechobee tar)
Medical Renewal History
Gallagher
Insurance Risk Management Consulting
The City has received significantly lower renewals each year
than it would have in the fully insured market
Year Loss Ratio PRM Gallagher Projected
Renewal Fully Insured Increase
2019/2020 110.3% 7.7% 25%+
2018/2019 108.6% 10.0% 25%+
2017/2018 176.7% 11 .0% 25%+
2016/2017 132.2% 14. 1 % 25%+
2015/2016 113.4% 8.3% 25%+ f;!tom ; .
2014/2015 185.2% 10.0% 25%+
2013/2014 134.6% 11 .6% ._ =`-"` }.h 25%+ ti } x` w,l
2012/2013 172.5% 9.4% 25%+
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`P\SKMA"46. 2011/2012 146 9%-, 7.5% .- 25%+ *6
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Gallagher
The C i ty s Other Coverages Insurance Risk Management Consulting
Rates for the City's Ancillary Benefits have remained unchanged -
and even reduced in some cases - through the years
Dental Insurance: High and Low Plans
Florida Combined Life
Rates have not increased in years. 5% rate reduction effective
October 1 , 2019.
Vision Insurance:
National Vision Administrators
Rates have not increased in years. Remain the same for October
1 , 2019 with no increase.
Life, Short and Long Term Disability:
The Standard
Basic Life and AD&D, and Short Term Disability reduced effective
October 1 , 2018. Rates remain the same for October 1 , 2019 with
no increase.
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Other Value-Added Benefits Gallagher
Insurance Risk Management Consulting
At No Additional Cost to the City
• Customer Service: Multiple layers of dedicated support through:
— PRM Administrative staff, with 2 dedicated professionals to the PRM
members
Florida Blue, with 2 dedicated professionals to the PRM members
— Gallagher, with 2 dedicated professionals to the PRM members
Benefits Administration System
• COBRA Administration
• Compliance Support
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Advantages of PRM Gallagher
<J Insurance I Risk Management Consulting
PRM stand Alone
Program
Predictable/Stable Renewals 0 ❑
National Account Status 0 0
Offer Employees 1-10 Plans 0 0
Dedicated Customer Service 0 0
Two Tiered Prescription Drug Program` 0 0
Customized Benefits 0 0
Determine Plan Benefits 0 0
Annual Educational Conference n r+
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Electronic Enrollment&Bill 0
Reconciliation
Actuarial Support 0 .>
Legal/Compliance Support 0
'Avalable with the PPO Plan 0702,0727 and HMO 55
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Thank you !
Paul Heb-
561 .998.6746
paul_hebert@ajg.com
2255 Glades Road, Suite 200E Gallagher
Boca Raton, FL 33431
Insurance I Risk Management I Consulting
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