AgdaPkt 2005-08-22 - Laserfiche WebLink

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REPORT ..s. / To the Honorable Mayor and City Council From the City Manager August 22, 2005 Subject Resolution adopting a Plan Document and Administrative Services Agreement between the City of Redwood City and Flex Plan Services, Inc. Recommendation Approve a resolution adopting the Plan Document and authorize the City Manager to enter in to an Administrative Services Agreement between the City of Redwood City and Flex Plan Services, Inc. for the administration of the Flexible Benefits Plan for City employees, effective January 1,2006 through December 31,2007. Background The Flexible Benefit Plan allows employees to pay for certain health care and dependent care expenses with pre-tax dollars. Each month, the City makes a contribution to the plan on behalf of each eligible employee at a set rate (the Kaiser Family rate). Employees elect which health plan they want to use and what other health care or dependent care options they want. Some of the plans they choose may be more costly on a monthly basis than what the City has allocated. Employees can then elect to set their own money aside to cover the difference using pre-tax dollars. Employees can put pre-tax dollars into one of these three types of accounts: 1. Premium Contribution Account - Allows employees to pay their share of health care premiums on a pre-tax basis. 2. Health Care Reimbursement Account - Employees can be reimbursed for the cost of a wide variety of health care cost not covered by the City's medical benefit plans and certain pre-approved out-of-pocket expenses such as deductibles and co-payments. 3. Dependent Care Reimbursement Account- Employees can be reimbursed for the cost of eligible work-related dependent care expenses. Currently there are 541 employees utilizing the Premium Contribution Account; 298 employees utilizing the Health Care Reimbursement Account; and 50 employees utilizing the Dependent Care Reimbursement Account. The Lipman Company, Inc. (TlC) has been the administrator of the City's Flexible Benefit Plan since 1992. However, in the last two years there has been a noticeable decline in communication and service levels. As the Department of Human Resources continues to evaluate the City's employee benefits programs to ensure the best possible service at the most effective cost, staff found it to be in the City's best interest to explore other options for Flexible Benefit Plan administration. In May of 2005, with the assistance of our broker ABD Insurance Services, the City received