Agenda - 09-09-2008- 4 - Laserfiche WebLink

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Flexible Compensation Plan The County provides a Section 125 Flexible Compensation Plan administered by Tucker Administrators. This Plan consists of a tax sheltering of health and dental premiums and two Flexible Spending Accounts (a medical spending account and dependent/child care spending account). These accounts enable employees to save money and increase their take home pay by eliminating income taxes and Social Security taxes on contributions employees make to the Spending Accounts. It also allows the County to reduce payroll taxes on employee contributions. Employees effect these reductions in taxes by setting aside a specific amount of funds into a spending account that are used for health related and/or dependent care expenses, resulting in a tax savings for both the employee and the County. The maximum contribution employees may currently make to the Medical Spending Account is $2,600 each benefit year. Federal regulations allow employees to contribute $3,000. Maximizing the amount of potential contributions allows Orange County to take full advantage of all possible tax savings. The County maximum allowable contribution to the Dependent/Child Care Spending Account is already at the Federal maximum of $5,000 per year. An enhancement to the 2009 Plan incorporates a new debit card feature which enables employees to pay for expenses at time of service with the funds from their accounts. This enhancement will increase employee participation in the Flexible Compensation Plan. Employee Assistance Program (EAP) Magellan Behavioral Health provides the County's EAP for County employees and their dependents. This benefit includes a number of services such as confidential assessment and counseling services, 24/7 emergency services, and legal consultation. Several changes that would greatly enhance the EAP can be made with an increase in cost of 7 cents per month per employee which would bring the overall cost to $1.61 per employee per month. The 2009 recommendation includes increasing the number of counseling sessions from three to five, the removal of the LifeManagement Resource and Referral Service, and the addition of financial consultation services to the legal consultation services. The Resource and Referral Service provides members with referrals for dependent or senior care, and is duplicated by County departments. Increasing the number of counseling sessions will allow employees more treatment and a greater continuity of care in dealing with personal, emotional and financial issues. The EAP is a complement to services provided through the County Health Plan at no cost to employees. Health Currently the County offers two fully insured health insurance plans. Both health plans are contracted through the NCACC Health Insurance Trust and administered by CIGNA. One plan is a Health Maintenance Organization (HMO) that requires participants to use a vendor network of physicians and facilities. The second plan is a Preferred Provider Organization (PPO) that allows both in and out of network services. When using out-of-network services,. the employee pays a higher portion of the cost. Both plans offer an in-network wellness benefit at no cost, which includes physicals, health screenings and immunizations. The current number of employees enrolled in each plan, rate changes, and plan changes to the health insurance are shown on Attachment 3. Staff has considered several options for the 2009 plan year that will stay within .the 8% increase budgeted for FY 08-09. The health care trend (percentage increase in claims costs that actuaries expect to see in the next 12-month period) would require a premium increase of 10-