10-21-25 City Council Meeting Packet

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City of Lake Elmo September 26, 2025 Page 2 The PEIP program continues to be in a strong financial position. However, we have seen claim costs increase significantly over the last 12 months. While the claims costs have varied across the groups in the program, a large driver of the increased claims cost came from prescription drugs, in particular GLP -1 weight loss drugs (increased over 30%). Because of these increased claims costs, the program wide premium increase needed for 2026 is a bit higher. There will be minimal changes to the PEIP plans for 2026: 1. Effective 1/1/2026, the mental health copayment for Cost Level 3 and Cost Level 4 for both High and HSA will decrease by $10 2. The Value plan is no longer offered in PEIP PEIP continues to offer unique features to public employer groups such as an individual choice of two network providers for each employee, along with two plan design options. Our administrative costs remain low by leveraging with the State of Minnesota employees’ contracts with the two network carriers. PLEASE READ CAREFULLY: The group enrollment commitment in PEIP statute 43A.316 has changed. Previously enrollment in PEIP required a two-year commitment, with an early termination option if a group received a renewal of 50% or more. The revised statute extends the enrollment commitment to four years, with an early termination option if you received a renewal of 20% or more. The goal of this change is to bring more stability to the pool. More stability helps to decrease volatility in renewal increases. In the first 10 years of the current pooling methodology, the plan had very high stability which resulted in average increases of approximately 3%. When the pool saw increased movement from our groups, the rate increases became higher. This return to stability will allow the plan to pool claims at a higher level which we anticipate will help keep rate volatility down. Your group is in year two of your two-year commitment so you will be automatically renewed under the new four year commitment statute, unless a termination notice is rec eived by 11.30.2025. During open enrollment, your insurance eligible employees have the opportunity to change health plans and carrier networks. Please have your open enrollment completed by November 16, 2025. The updated summaries and other enrollment information are included in your email. Forms can also be found on PEIP’s website at www.innovomn.com. Individual Medicare Advantage and Cost policies are available for your retirees over age 65. Please call Innovo Benefits Administration at 1-800-829-5601 or visit our website at www.innovomn.com.