Agenda - 09-22-2008 - 3 - Laserfiche WebLink

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3 $50,000. An employee also has the option to purchase additional coverage. Effective January 2008, Metl_ife became the carrier for athree-year contract. The Plan design for 2009 has no changes. The County pays 22.5 cents for every thousand dollars of coverage per month for life and accidental death and dismemberment insurance. Dental Insurance The County provides aself-insured dental plan with Delta Dental of N.C. serving as the third party administrator. Premiums earned in FY 07-08 were $443,500 and claims and fees paid were $368,800. The dental plan's fund balance at the end of FY 2007-08 was in excess of $300,000. There is no increase in Delta Dental's administrative fee of $2.00 per member per month. All claims are paid based on a Table of Allowances (TOA) which Orange County establishes. Although the County reimburses preventive services at 100% of the TOA, the current Table has lagged behind standard rates of reimbursement, causing employees to pay an increasing amount for services. This has reduced the value of the benefit and only a third of employees are taking advantage of the preventive and diagnostic care. Staff reviewed the TOA and identified the most common preventive and diagnostic services that could be reimbursed at the Maximum Payable Amount (MPA). Attachment 3 provides a comparison of the current and proposed TOA. Based on experience, this change will increase the County's claims by approximately $48,000 annually and can be absorbed by the current funding over the next several years. Attachment 4 is a projection showing that the Dental Fund will continue to be adequately funded over five years. Staff will continue to regularly monitor the dental fund. 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 affect 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 employees and the 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.