HomeMy WebLinkAbout06-17-13 Council PacketWORK SESSION AGENDA
CITY OF LINO LAKES
Monday , Ju ne 17 , 201 3
SPECIAL CITY COUNCIL WORK SESSION
Community Room (not televised)
5:30 P.M.
1. 2014 Budget Preparation
2. Legislative Actions
a. Sales Tax Exemption
b. Levy Limits
c. PERA Police & F ire Pension Fund
3. Job Vacancies
4. Up date on Health Care Reform
5 . Next Steps
Adjourn
WS – Item #4
WORK SESSION STAFF REPORT
Work Session Item No. 4
Date: June 17, 2013
To: City Council
From: Jeff Karlson
Re: Update on Health Care Reform
Background
Staff has been trying to stay abreast of the health care reform act by particip ating in various
seminars. As expected, implementing the new law has presented unique challenges and
opportunities for employers.
In particular, an individual coverage mandate, the creation of insurance exchanges, and the
availability of federal premium s ubsidies for low -income workers in 2014 require employers to
decide whether to “play” (sponsor a health benefit plan that meets specific minimum
requirements) or “pay” (forgo plan sponsorship, pay a penalty and require employees to secure
coverage for them selves through the Minnesota Exchange).
However, the decision is more complex than simply “play” versus “pay.” There are a number of
approaches to help employers reshape their health benefits programs. In the weeks ahead, the
Council will need to select the approach that provides the optimal value in terms of both cost and
talent. In other words, finding the “sweet spot” whereby the City offers adequate benefits to
retain the talent we currently have.
Understanding the Affordable Care Act (ACA) and h ow to implement it is further complicated
by the fact that the IRS has not defined the meaning of several provisions in the mandate.
Another consideration is state law regarding the “aggregate value of benefits” that applies to
union contracts. This stat e law provides that “the aggregate value of benefits provided for
employees covered by a collective agreement shall not be reduced unless the public employer
and appropriate bargaining unit agree to a reduction in benefits ” (Minn. Stat. Sec. 471.6161).
Th is means that contributions toward premiums, HSA’s, and waiver of coverage will continue to
apply. T he City cannot get out of the insurance game like a private company can .
Health plans must provide a Summary of Benefits and Coverage to participants and
beneficiaries. Employers must provide employees a written notice of the ACA’s health
insurance exchanges by October 1, 2013.
Staff will arrange for Johnson -McCann Benefits to present information about the ACA at a
f uture work session.