Recommend approval to renew an annual contract with Humana Inc. for the group Medicare Advantage Plan to provide group Medicare Advantage Plan for City retirees and their spouses who are Medicare primary.

Changes in governmental accounting standards require recognizing the cost of post-employment benefits over the working career of an employee.  In order to reduce this liability while maintaining retiree medical benefits, the best solution is a group sponsored, fully insured Medicare Advantage Plan.  Based upon 100 percent enrollment, the estimated annual cost for the approximately 748 covered retirees and spouses equals $2,112,121.00, of which the City will pay on average 52 percent of the premium.  This premium is reflective of an increase of approximately 4.165 percent from the prior year.

This is a sole source because our current employee benefits consultant, USI Insurance Services, conducted a market assessment and determined that this is the most cost effective plan.

Approval