Agenda - 03-01-2012 - 2 - Laserfiche WebLink

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2 I Like every Part D plan, the BCBSNC Part D plan does not cover every medication prescribed for all retirees. Medicare has made severai changes in the past few years, as has BCBSNC. Whenever possible, the County has reduced costs for Plan F and Part D by making administrative changes that did not affect the post-65 retiree benefits. The average cost of the County's cost for post-65 retiree Medicare coverage is less than half of the cost of the group health insurance individual premium. As of February 2012, more than 12% (more than 100 individuals) of current Orange County employees are eligible to retire. As more baby-boomers retire and live longer, retiree health insurance will become a greater cost to the County. In 2011, approximately 100 employees were eligible to retire and receive retiree health insurance, and in 2012, the number of employees eligible to retire will exceed 120. Orange County's benefits exceed the average health insurance benefit in North Carolina in terms of co-pays and deductibles. As a comparison, the following information is included: • Attachment 1 - Summary of employee health care benefits from other of local government employers throughout the state. • Attachment 2 - Summary of Comparative Retirees Health Cost and Liabilities • Attachment 3 — Projected Post-Employment Benefit Analysis through Fiscal Year 2017 ' • Attachment 4 — Current Monthly Retiree Health Insurance Cost Staff has previously identified a variety of options that lower the cost of employee and retiree health care. These options were presented at the May 10, 2011 work session. Attached is an article from GOVERNING that describes the best practices in reducing retiree health costs. Each option has varying impacts on both retirees and the County. FINANCIAL IMPACT: There is no financial impact associated with receiving information and providing feedback on options related to employee and retiree health care. RECOMMENDATION(S): The Manager recommends that the Board receive information on employee and retiree health care and provide feedback regarding options related to employee and retiree health care benefits. The FY 2012-13 proposed budget does not include any specific changes at this time, but does expect to have to budget projected increases (up to 15%) in premiums/costs. We will discuss various approaches to addressing these issues as outlined in the GOVERNING article. Each has a varying impact. As outlined in the article some of the options may not be applicable in North Carolina.