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HomeMy WebLinkAbout2008 09 22 Regular 602 ADD ON Insurrance Issue Related to Fire ConsolidationCity of Winter Springs Regular Meeting September 22, 2008 092208_COM M_ADD-ON-602_Insurance_Issue_Fire_Con solidation Page 1 of 2 COMMISSION AGENDA ADD-ON ITEM 602 Consent Informational Public Hearin Re ular X September 22, 2008 MGR. ~~/DEl'T. Regular Meeting Authorization REQUEST: The City Manager requesting the City Commission to review the facts surrounding an insurance issue related to Fire Consolidation. PURPOSE: This agenda item is needed for the Commission to decide what, if anything, it desires to do regarding the health insurance issue raised at the Wednesday, September 17, 2008 Budget Workshop by members of the Fire Department. CONSIDERATION: At the September 17, 2008 Commission Workshop one of the Winter Springs' Firefighters being consolidated with Seminole County raised an issue regarding health insurance with the County. As I understand it, the firefighters conveyed that they were going to have to pay double for one month's coverage. If understood correctly this contention is not accurate. THE PROBLEM: Both the County and the City offer health insurance to the employee after one month of employment. However, the timing by which the County and the City deduct the employee portion of that health insurance premium differs as outlined below: 1. Citv -The City deducts the employee's portion of the health insurance premium in the same month coverage is provided. For example, if you begin work with the City in October, the first month of coverage would be November and the payroll deductions for the employee portion of the premium would not begin until November. 2. County -The County deducts the employee's portion of the health insurance premium in the month rip or to the month of coverage. For example, if you begin work with the County in October, the first month of coverage would be November but the payroll deductions for the employee portion of the premium would begin one month prior in October. We conferred vigorously with the County to demand that the County begin coverage immediately in October, the first month of consolidation. The County had to work out special arrangements with their carrier to make this happen. The carrier agreed to do the following: City of Winter Springs Regular Meeting September 8, 2008 092208_C OMM_ADD-ON-602_Insurance_Issue_Fire_Consolidation Page 2 of 2 Employee Coverage - Since the County pays the full premium for the employee the County agreed to begin coverage in October, the first month of consolidation. Family Coverage -Since employees are required to pay a portion of the premium for dependent coverage it will be necessary for those employees electing such coverage to pay their share of the premium for all the months of coverage. Contrary to the City's deduction method, the County deducts for insurance premiums one month in advance. Accordingly, this will result in the employee having to pay their dependent portion for October and November coverage in October. It should be noted that the County has agreed to allow any firefighters with dependent coverage who would have a difficult time paying for their portion of two months of dependent coverage to stretch it out over several pay periods. CONCLUSION: 1. The County has responded to the City's concern that employees being consolidated with the County must have health insurance coverage in October. 2. Due to the difference in the timing of the County's and the City's health insurance deductions, the County is willing to extend special payment arrangements for the first month of dependent coverage. The employees with dependent coverage are not being required to pay for coverage twice but due to the timing difference will have deductions for two months of coverage. In the final analysis, the firefighters are merely getting ahead one month in their dependent premiums. To pay further would extend additional benefit ONLY to those firefighters selecting dependent coverage. The City of Winter Springs has no place in this situation, and certainly no responsibility to pay for premiums which the employee is obligated to pay under the County's plan. Such an action on the part of the City would be a prime example of a misuse of taxpayer funds. The property owners of Winter Springs are alreadypaying for this dependent coverage via the County's MSTU levy. For the City to offer to pay additionally for October's dependent coverage would be charging Winter Springs' property owners yet again for this health benefit. FUNDING: 1. Not Applicable 2. If the City were to pay for this coverage the cost is estimated to be around $10,000. RECOMMENDATION: There is no basis for the City to get involved in this matter since the County has already agreed to absorb the employer cost for the October dependent coverage. Therefore, it is recommended that the request for the City to pay such a redundant expense be denied. ATTACHMENTS: COMMISSION ACTION: