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City of Nashua

Administrative Services Division Phone (603) 589-3260
229 Main Street - Nashua, NH 03060

June 9, 2020

To: Mayor Jim Donchess
Members of the Board of Aldermen

From: Kim Kleiner, Director of Administrative Services
Re: Health Insurance Fund

The following information on the benefits self-insurance fund is provided in response to a request
from the Budget committee on June 2, 2020.

Workplace Benefit Solutions (WBS) estimates the self-insurance benefit fund balance to be $8,934,229
at fiscal year-end.

Balance as of 6/6/20 (Exhibit 1) § 14,034,229
Estimated Addtl Claims ($2,100,000)
Annual Budget True-up for participant shifts ($2,000,000)
Loss Ratio (due to employees for realized savings) ($1,000,000)

S 8,934,229

We recommend, in consultation with WBS, to maintain a fund balance of $8,934,229. The estimated
year-end balance of $8,934,229 reduced by the FY20 costs of 2.5M, to be realized in FY21, would leave
the fund at $6,434,229, Three factors to consider when projecting health care costs for FY21 include:

1. F¥24 Claims will be higher due to rescheduled and delayed procedures due to the COVID19
pandemic. Projections show costs for FY20 will be realized in FY21 (see exhibit 2).

2. Cost of medical care continues to increase. Industry trend projects a 9% increase each year.

3. Only one of the city’s 18 employee groups, the unaffiliated employees, has accepted health care
plan redesign to date.

We believe the FY21 benefits budget of 36.5M can be reduced by $348,334. The city expects a savings
of $348,334 which represents the employer savings due to the shift of participation in the high
deductible health plan of $297,334 and a reduction of $51,000 in administrative fees.

The open enrollment process for FY21, July 1, 2020 - June 30, 2021, resulted in the following shift in
plan participation:

FY20 FY21 Change
HMO (Traditional Plan) 1,371 1,281 (90}

HMO (Plan redesign — Unaffiliated) 59 28 (31)

High Deductible-Health Savings Acct 603 724 121

The participant shifts will result in a reduction of $74,331 in employee cost, and $297,334 in employer
cost (see Exhibit 3).

The city has also entered into a new program offered by Anthem which provides additional auditing of
claims to prevent waste, fraud and abuse. Enrolling in the new program resulted in the city saving an
additional $2 PEPM (per employee per month) on our administrative fee effective July 1, estimated to
save approximately $51,000 for the FY21 plan year. Anthem will retain 25% of the savings achieved by
the program and estimates the city will have a net savings of $300,000 to $350,000. We will evaluate
the effectiveness of the new program at the end of FY21 and budget any realized savings into FY22.

We would like to note the increase realized in Stop Loss reimbursements. To date, we have realized
$1,221,663 in reimbursements for FY20 compared to a total of $730,952 in FY19, The city received
one bid for renewal of this policy for FY21, which resulted in an increase premium cost of $150,000
annually.

FY2020

Revenue: Jul-19 Aug~19 Sep-19 Oct-19 Nov-19 Dec-19
Balance Manthly Ches. Ending Balance Monthly Ches. Ending Balance Monthly Chas. Ending Balance Monthly Ches, Ending Balance Monthly Ches. Ending Balance
Stop Loss Revenue § 38,721.53 $ 34,862.11 4 73,583.64 $§ - $ 73,583.64 $ : $ 73,583.64 $ 357,913.58 $ 431,497.22 § 87,980.76 § 519,477.98
Crug Rebates $ - $ 20.00 $ 20.00 $ ~ $ 20.00 $ - § 20.00 $ 38,955.26 $ 38,975.26 $ 210,651.97 $ 249,627.23
Trf From General Fund (Leg} S$ 2,000,000.00 $ . $ 2,000,000.00 § ~ § 2,000,000.00 $ - $ 2,000,000.00 $ - § 2,000,000.00 $ 990,000.00 $ 2,900,000.00
Expenses:
Stop Loss Expense 3 73,816.89 $ 73,713.36 5 147,530.25 $ 73,885.91 § 221,416.16 $ 73,678.85 § 295,095.02 § 73,713.35 $ 368,808.37 $ 73,851.40 $ 442,659.77
Ciaims Administration $ 97,299.79 $ 123,763.92 §$ 223,063.71 $ 146,209.38 $ 367,273.09 $ 96,586.30 $ 464,159.35 $ 121,494.33 § $85,653.72 $ 321,705.65 $ 707,359.37
Claims Health $ 4,043,902,72 5 3,243,931.30 $ 7,287,834.02 $ 2,810,659.17 $ 10,098,493.19 $ 3,739,82548 $ 13,898,318.67 $ 3,125,759.94 $ 16,964,078.61 $ 2,812,236.14 $ 19,776,314.75
Dental Claims $ 238,953.75 § 499,375.37 § 738,329.12 $ 373,610.14 $ 1,111,939.26 $ 226,071.84 $ 1,338,011.10 § 372,388.01 5 1,710,399.12 $ 315,511.20 $ 2,025,910.31
Fund Balance: $__6,128,139.63 $ 6,140,459.46 $ _ 6,564,989.52 § _6,682,241.52 $7,248, 348,18 § 9,032,949.50
Change in Fund: § 12,315.83 $ 424,524.06 $ 117,258.00 S 566,106.66 S$ 1,783,601.32
F¥202G6
Revenue: fan-20 Feb-20 Mar-2¢ Apr-20 May-20 June-20 thru 6/6
Monthly Ches. Ending Balance Monthly Chgs. Ending Balance Monthly Chgs. Ending Bafance Monthly Ches. Ending Balance Monthly Ches, Ending Balance Monthly Chgs. Ending Balance
Stop Loss Revenue § 3242107 § 550,899.95 $ 104,258.75 § 655,158.70 $ 74,229.89 $§ 729,388.59 $ 434,354.43 § 1,163,743.02 $ $9,406.65 $ 1,263,349.67 $ 28,514.26 $ 1,291,663.93
Drug Rebates 5 - $ 249,627.23 $ 177,868.86 $ 427,496.09 5 - $8 427,496.09 § - §$ 427,496.09 § ~ § 427,496.09 § - $§ 427,496.09
‘Trf From Genera! Fund {Leg) 5 - $ 2,900,000.00 § - § 2,900,000.00 $ : $ 2,$00,000.00 $ - S$ 2,900,000.00 $ ~ § 2,900,000.00 $ - $ 2,900,000.00
fxpensep:
Stoo Loss Expense $ 74,092.97 $ $16,752.74 $ 74,679.64 § 591,492.38 § 74,527.48 4 665,559.86 §$ 74,127.48 5 739,687.34 3 74,195.50 $ 813,883.84 § - § 813,883.84
Claims Administration $ 122,097.81 $ 823,457.18 5 122,973.57 § 952,430.75 $ 147,190.09 $ 1,095,620.84 § 97,476.24 $ 1,397,097.08 § 122,360.60 $ 4,319,457.68 § 24,875.55 $ 1,344,393.23
Claims Health § 3,739,828.08 § 23,516,142.83 $ 3,068,610.38 $ 26,584,753.21 $ 3,840,117.05 $ 30,424,870.26 $ 2,757,110.67 S 33,181,980,93 § 2,469,523.59 § 35,651,504.52 $ $02,704.77 $ 36,154,209.29
Dental Claims $ 270,035.31 $ 2,295,945.62 $ 259,125.95 $ 2,555,071.57 § 791,274.01 $ 2,846,345.58 § 28,833.04 S$ 2,875,178.62 § 60,757.37 $ 2,935,935.99 § 30,858.63 $ 2,966,794.62

Fund Balance:
Change in Fund:

$ _9,860,336,78
§ 828,367.28

$ _10,475,949.29
3 615,632,512

$ 9,972,149.61
5 {503,799.63}

$_11,743,754.60
$ 1,771,604.99

5 12,859,064.45
$ _1,115,309.85

$ 14,034,229.37
S$ 1,175,164,92

Exhibit 1

Trends in the Health Fund by Month:

FY¥2019
dubia Aug-i8 Sep-18 Oct-12 Nov-18 Dec-i8
Revenue: Balance Menthty Ches. Ending Batance Monthly Ches. Ending Balance Monthly Chgs, Ending Balance Monthly Chgs. Ending Bafance Monthly Chgs. Ending Bajance
Stop Loss Reventie $ : $ - $ - 5 51,898.53 $ 54,298.53 - 8 $1,998.53 $ - § 51,898.53 4 - $ 51,898.53
Drug Rebates 5 - § - 8 - $ - § - - § - $ 211,876.01 5 211,876.01 4 - $ 211,876.01
Trf From General Fund (Leg) $ - 5 - 5 - $ - $ . $ - $ - - $ - 3 - $ -
Top Four Expenses:
Stop toss Expense $ 65,034.99 § - § 65,034.99 § 67,498.58 $ 132,533.67 $ 137,138.21 $ 269,671.88 § 67,379.19 § 337,051.07 $ 67,315.69 $ 404,366,76
Claims Administration $ 105,341.80 $ 89,264.02 § 194,605.82 $ 102,352.91 § 296,758.73 5 101,432.85 § 398,191.58 $ 107,032.04 § 500,223.62 $ 114,162.83 § 614,386.45
Claims Health 3 2,756,957.69 $ 3,943,757.58 $ 6,700,715.27 $ 3,240,004.49 $ 9,940,719,76 $ 3,586,502.23 $ 13,527,221.99 $ 3,208,485.51 $ 16,795,707.50 $ 2,761,511.74 § 19,497,219.24
Dental Ciaims $ 916,429.05 $ 329,633.28 4 646,062.33 5 317,640.42 § 963,702.75 $ 313,625.71 3% 1,277,328.d5 § 335,993.71 $ 1,613,222.17 § 302,339.88 $ 1,915,562.05
Fund Balance: $ 7,040,140.30 5 6,638,660,.38 § 6,465,865.33 3 5,B52,706.97 § 6,348,119.66 § 6,725,758.93
Change in Fund: 4 (401,479.92) § {168,795.05} 3 {617,358.36) 4 495,442.69 § 377,639.27
F¥2019
Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jur19
Revenue: Monthly Chgs. Ending Balance Monthty Ches. Ending Balance Monthly Ches. Ending Balance Monthly Chgs. Ending Balance Monthly Ches. Ending Balance Monthly Ches- Ending Balance
Stop Loss Revenue 5 - $ 51,898.53 $ - $ $3,898.53 § 51,898.53 5 - 5 51,898.53 - s 51,898.53 $ 679,053.57 5% 730,952.10
Drug Rebates , § 32,243.95 § 244,119.96 $ 244,088.13 $ 488,208.09 § - 488,208.09 $ - 3 488,206.09 § 286,069.22 $ 774,277.31 $ 284,342.80 5 1,056,420.11
Tsf From General Fund (Leg} s - s * $ - 5 - $ - - $ - - - $ - $ 1,000,000.00 $ 1,000,000.00
Top Four Expenses:
Stop Loss Expense $ 67,495.69 $ 47136245 § 67,466.04 § 539,328.49 § 67,419.02 606,747.51 $ 66,952.70 $ 673,700.21 $ » $$ 673,700.21 $ 134,072.23 § 807,772.44
Claims Administration 3 89,050.94 $ 703,437.59 $§ 102,764.70 § 805,202.09 $ 101,989.13 907,191.22 § $25,954.23 5 1,033,145.45 § 77,576.18 § 1,110,721.63 § 115,033.55 §$ 1,225,755.18
Claims Health 5 3,788,558.37 $ 23,285,777.61 $ 3,659,817.92 §$ 26,945,595.53 $ 3,628,248,47 30,573,844,00 §$ 3,331,20182 § 35,905,045.82 § 4,113,774.98 § 38,018,820.80 § 3,327,845.38 § 41,346,666.18
Dental Claims $ 223,323.72 $ 2,258,885.77 $ 261,178.64 $ 2,900,064.41 § 361,099,06 2,761,163.47 365,708.46 $ 43,126,871.93 4 286,276.95 $ 3,413,098.88 $ 305,136.91 $ 3,718,235.79
Fund Balance: $ _7,288,349.62 § 6,991,969.39 6,350,433.58 $ 6,015,734.45 $ 5,670,276.02 $ 5,755,322.07
Change in Fund: 5 542,590.69 3 (296,380.23) (641,535.81) 5 (334,699.13) $ (345,458.43) 5 85,046.05

$ (914,953.95) Wout trf.

REGULATION, OR ORDER OF THE SECRETARY OF LABOR, OR AS OTHERWISE
PROVIDED BY LAW.

(8) THE CONTRACTOR WILL INCLUDE THE PORTION OF THE SENTENCE
IMMEDIATELY PRECEDING PARAGRAPH (1) AND THE PROVISIONS OF PARAGRAPHS
(1) THROUGH (8) INEVERY SUBCONTRACT OR PURCHASE ORDER UNLESS
EXEMPTED BY RULES, REGULATIONS, OR ORDERS OF THE SECRETARY OF LABOR
ISSUED PURSUANT TO SECTION 204 OF EXECUTIVE ORDER 11246 OF SEPTEMBER 24,
1965, SO THAT SUCH PROVISIONS WILL BE BINDING UPON EACH SUBCONTRACTOR
OR VENDOR. THE CONTRACTOR WILL TAKE SUCH ACTION WITH RESPECT TO ANY
SUBCONTRACT OR PURCHASE ORDER AS THE ADMINISTERING AGENCY MAY
DIRECT AS A MEANS OF ENFORCING SUCH PROVISIONS, INCLUDING SANCTIONS

FOR NONCOMPLIANCE:
PROVIDED, HOWEVER, THAT IN THE EVENT A CONTRACTOR BECOMES INVOLVED IN, OR IS
THREATENED WITH, LITIGATION WITH A SUBCONTRACTOR OR VENDOR AS A RESULT OF SUCH
DIRECTION BY THE ADMINISTERING AGENCY, THE CONTRACTOR MAY REQUEST THE UNITED
STATES TO ENTER INTO SUCH LITIGATION TO PROTECT THE INTERESTS OF THE UNITED STATES.

rie

06/0

City of Nashua - GRAND TOTAL including MERIT, POLPATROL & TEACHERS
Estimated Impact of Enrollment Shift to HSA

1/2026

FY21 Estimated Costs Without Enrollment Shift

Fy21 Es timated Costs With Enrollment Shift : :

PY21 Estimated Savings

Prior |: Eshployes Employer “yotai Cast. | Enrolment | (Employee Employer Employee Employer ay
‘) Burollment | Contributions. Contributions 22s eerr | EAL 9/1/20 | Contributions Contributions Changes Changes ° .
a $782.00 0 SLIT Ad 4 s7a20 2 ST AI7 A
20 |: SLS7L21 Sos $9348.87. 20 | $674.06 SU STL2D 22 $2248,87
1s}: $2,108.05 9 SOTTO 5] Re $2,108.05 2 $3,050 oe
76 |: $1,142,003 © 76 [$489,428 $1,142,003 81,631,432 $0 2 st
$806.54 450 [ES $201.63. gROiS4 25 St ONkaT
$1,624.78 © 325 Po s406.207 $1624.78 920-7 $2,030.08"
$2,172.46 ng [oe $54 S22 Oo SFT RET
$25,616,036 ::. 1,281 | $23,883,135 2 $29,853,881 GENRE id bee toby
$621.64 0 |: $021.69 |
$1251.49 of: $125 149
$1675.90 UO]: SL675.90 - “$2504.14:
$0 a |: $0: oy $t 30
$641.20 25 8 S64 LW Lo SBGLBO
$1,291.70 7 SL 291.70 8 S614 8
$1727.10 B SU2221) 5 SRR AS
$920,248 28 $439,486 2) $549,358 EEO IBD MOMS
SO77A7 235 SOTTAT
$1,360.96 162 $1360.96 :
SL75 1.48 27 SLZ5 148 8 : o
39,5 12,050 724 $11,428,979 $479,083 581,916,329 $2,395,412
$575.11 21 $575.11
$£,158.60 4 $1,158.60
SE540.42 u SI 549,12 | Toads. -
$405,024 36 os : $405,024 0-7 $506,281 $0 80
. $9,602,886 $37,595,962“) $47,198,948° 2,145 [2° 9935285555 $37,298,628 2° -$46:827, 183° (SPL ERE STAG

Exhibit 2

ei Make Up.-Claims
COVID-19 Claims:

_ . vn fe — | Sav actual Claims:

7 Faecal ened anand bauer tH ecg i a

sub 2e Auge20 Sep-20 Oct-20 Nav-20" Dec-20 - Jon-21Feb-2i--Mor2i Apr-21 May-21 fun-21 Jubzt

Nates:

i. Actual claims are those claims we expected to see prior to the outbreak of COVID-19 claims. Claims decrease belaw the average monthly expected amount due to the short term elimination of non-essential
services. We are currently projecting @ 25% reduction in normal claims activity.

2, COVID-19 claims are those claims we expect to see due ta the COVID-19 pandemic and include both testing and treatment. This model assumes an infection rate of 0.37% based on current city-wide data. Since
CON hos a large population of first responders, this estimate may be lower then actual, We are estimating the cost per patient at $20,000.

3. Moke up claims are those non-essential services that are rescheduled for the future. This model assumes 80% of the deferred services will be rescheduled.

4, Prior to COVID-19, expected claims for the second half of Fiscal Year 2020 were $18,933,102. With the impact of COVID-19, we expect claims to be $16,413,059. This represents an 13.3% reduction in claims.

June 10, 2620

FY21 Health Insurance Enrollment by Union

City/PD/School Union

City
City
City
City
City
City

City - PD
City - PD
City - PD
City - PD
City - PD
City - PD
City - PB
City - PD

NSD
NSO
NSD
NSD
NSD
NSD
NSD
NSD
Retirees

AFSCME DPW

Fire

Library

UAW Clerical- Technical
UAW Professional
Unaffiliated

Police Ist Year

Police Animal Control
Police Chief Executive
Police Communications
Police Patrolmen

Police Staff (Captains)
Police Supervisors
Police UFPO

Administrators & Supervisors
AFSCME School Custodians
Clerical

Food Service

Paras

Principals

Teachers

Unaffiliated

Grand Total

% of total Membership
Health Insurance Waived
Total Eligible Employees

% of insured

NewtoHDHP Employee Employees in
HMO/POS WAIVED INS. HDHP Total Insured FY21 Grand Total HDHP
71 12 26 97 3 109 27%
60 9 97 157 4 166 62%
20 6 8 28 0 34 29%
40 9 25 65 7 74 38%
23 1 a5 38 4 39 39%
25 18 90 115 31 133 78%
3 4 9 12 1 16 75%
1 0 0 1 0 1 0%
0 0 3 3 1 3 100%
4 1 12 16 8 17 75%
46 8 59 165 19 113 56%
0 0 7 7 1 7 100%
4 1 27 31 5 32 87%
7 0 9 16 4 16 56%
30 12 & 38 0 50 21%
94 14 9 103 2 117 9%
49 17 8 57 0 74 14%
V7 48 5 22 0 70 23%
114 228 51 165 1 393 31%
22 5 12 34 2 39 35%
616 197 202 818 24 1015 25%
24 73 17 41 4 114 41%
108 0 69 177 4 177 39%
1378 663 768 2146 125 2809 36%
24% 76%
663
2809

Board of Aldermen

City of Nashua
229 Main Street
Nashua, NH 03061-2019

(603) 589-3030

MEMORANDUM

TO! Board of Aldermen

FROM: Donna Graham, Legislative Affairs Manager \ ~ | chen —
DATE: June 17, 2020

SUB! Communications Received from the Public

Attached please find communications received from the public as follows:

From: Laurie Ortolano
Re: Public Input

From: Dave Villiotti
Re: River Casino/School Street Lot

From: Laurie Ortolano
Re: Charter Change

From: Laurie Ortolano
Re: Complaint

From: Laurie Ortolano
Re: Follow Up Complaint

From: Laura Colquhoun
Re: Public Comment

From: Carole and David Barker
Re: Public Comment

From: Ramesh Reddy
Re: Public Comment

From: Wayne Saya
Re: Masks

Graham, Donna

From: Laurie Ortolano <laurieortolano@gmail.com>

Sent: Thursday, June 04, 2020 5:07 PM

To: Board of Aldermen; Board of Assessors

Ce: Dean Shalhoup; Heather Henline; Gerry, James; Stepp, Lindsey
Subject: Re: Community Input

CAUTEON: This email came from outside of the organization. Do not click links/open attachments if source is
unknown.

Laurie Ortolano

41 Berkeley St
Nashua, NH 03064
June, 4, 2020

Lori Wilshire,

I would like this email placed as part of the public record in the Board of Aldermen meeting. From this point
forward, all my Board of Assessor email concerns are coming back to the Board of Aldermen for public input.

Board of Assessors Public Barricade

Dan,

I am very confused by your email. Here is what I now understand.

The Nashua Board of Assessor is not accepting any form of public input, email or otherwise.

Your board has not voted since the beginning of the pandemic on how input would be accepted.

On Aprill5, I sent an email to you and asked if your board planned on voting on how to handle input.

I received no response but did get an answer in that no action was taken in a public meeting further indicating
that no public input, of any form, would be allowed.

On May 27, 2020 1 requested that an email I wrote be placed in community input, but it was not because the
Board is not accepting email community input.

In today's meeting, you stated that you believe that the Board of Assessor should foliow the lead of the Board of
Aldermen when accepting input.

This is where it becomes confusing.

Your two other Board members agreed that the Board of Assessor would operate as the Board of Aldermen
does.