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Staff Report
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Report To: Council
Date of Meeting: October 18, 2021 Report Number: LGS-026-21
Submitted By: Rob Maciver, Director of Legislative Services
Reviewed By: Andrew C. Allison, CAO Resolution#: C-324-21
File Number:
By-law Number:
Report Subject: Health Benefit Program 2021 Renewal to November 1, 2022
Recommendations:
1. That Report LGS-026-21 and any related communication items, be received;
2. That the Health Benefit Program be renewed with Sun Life, to November 1, 2022 at
an overall net increase of 1.4% and that the Stop Loss and Out of Country Pooling
level be increased from $15,000 to $20,000 effective January 1, 2022; and
3. That the Library be advised of the renewal program, and that they continue to be
invoiced for their portion of the benefit program as applicable.
Municipality of Clarington
Report LGS-026-21
Report Overview
Page 2
The annual renewal of the Health Benefit Program is presented for approval for the period of
November 1, 2021 to November 1, 2022.
1. Background
Existing Program for Health Benefits
1.1 The Extended Health (EHC) and Dental Benefits program with Sun Life remains under
an Administrative Services Only (ASO) funding formula. The non-ASO benefits which
include Life Insurance, Long Term Disability (LTD) and Accidental Death &
Dismemberment (AD&D) continue under the traditional funding formula.
1.2 The Stop Loss and Out of Country Pooling level is currently at $15,000 per person. This
protects the EHC plan against claims in excess of $15,000 and such claims are
removed from the claims experience.
2. The 2022 Program Renewal
2022 Rates and Overall Impact
2.1 Mosey and Mosey has undertaken negotiations with Sun Life to reduce the proposed
benefit program rate increase of 10.4%. They have provided two separate options for
consideration. The first option involves keeping the current level of Stop Loss and Out of
Country Pooling at $15,000. This would result in an overall rate increase of 4.0% as
detailed in Attachment #1. The second option is to increase the Stop Loss and Out of
Country Pooling to $20,000. This would result in an overall increase of 1.4% for both
ASO and non-ASO benefits as detailed in Attachment #2. This is the option
recommended by Mosey and Mosey with an effective date of January 1, 2022.
2.2 The impact of COVID-19 on services such as dental and paramedical services was less
prevalent in 2021 than in 2020 with service providers able to provide their services with
less closures and additional safety precautions in place.
2.3 The overall rate increase is also impacted by an increase to LTD benefit premiums
which is based on claims experience.
Municipality of Clarington Page 3
Report LGS-026-21
3. ASO Funding Status
3.1 The Municipality has established the ASO Benefits Reserve Fund which can be used to
fund fluctuations in actual benefits and stabilize the tax impacts of health benefits.
3.2 At January 1, 2021 the opening balance in the ASO Benefits Reserve Fund is
approximately $1.2 million. This balance came from the initial $500,000 contribution and
the unspent surplus from the 2020 fiscal year (where we saw a surplus due to benefit
usage).
3.3 The Director of Financial Services/Treasurer will consider the appropriateness of using
the Reserve Fund to offset increases as part of the 2022 Draft Budget preparation.
4. Recommendation
4.1 Staff recommend that the 2022 Health Benefit Program be renewed with an increase in
the Stop Loss and Out of Country Pooling to $20,000 thus benefiting from Mosey and
Mosey's negotiations of an overall 1.4% increase.
5. Concurrence
This report has been reviewed and contributed to, by the Director of Financial
Services/Treasurer who concurs with the recommendations.
6. Conclusion
It is respectfully recommended that the renewal of the Health Benefit Program be
approved as outlined in this report.
Staff Contact: Lisa Wheller, Human Resources Manager Iwheller(u)_clarington.net or Kerri
McMullen, Compensation and & Benefits Supervisor kmcmullen(a_clarington.net.
Attachments:
Attachment 1 — Mosey and Mosey Monthly Renewal Rates and Cost Summary, with $15,000
Stop Loss
Attachment 2 — Mosey and Mosey Monthly Renewal Rates and Cost Summary, with $20,000
Stop Loss
Interested Parties:
The following interested parties will be notified of Council's decision:
The Clarington Library
Attachment 1 to
Report LGS-026-21
THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON
All Divisions Combined
November 1, 2021 Renewal
Benefit
Basic Life Insurance
Volume
88,816,500
$
Current
Cost
Monthly
Premium
23,236.91
Renewal
bUn Lite eroposea
Cost Effective
November 1, 2021
Monthly
Premium
%
Adj.
Renewal
$
Negotiated
Cost Effective
November
Monthly
Premium
20,459.50
%
Adj.
-12.0%
$ 21,581.75 -7.0%
Supplemental Life Insurance
14,403,000
1,641.94
1,526.72
-7.0%
1,440.30
-12.0%
Dependent Life
355
2,415.63
2,415.63
0.0%
2,415.63
0.0%
AD&D
88,816,500
1,687.51
1,687.51
0.0%
1,687.51
0.0%
Long Term Disability
1,719,106
66,226.21
77,480.50
17.0%
70,196.23
6.0%
Extended Health Care
Single
56
8,033.56
8,917.26
8,499.37
Couple
134
38,624.03
42,872.37
40,864.40
Family
225
83,968.85
93,205.66
11.0%
88,838.79
5.8%
Dental
Single
56
3,597.63
3,957.47
3,766.67
Couple
134
17,236.18
18,959.74
18,046.70
Family
225
45,356.60
49,892.15
10.0%
47,488.76
4.7%
TOTAL MONTHLY PREMIUM
$
292,025.05
$
322,496.76
$
303,703.86
TOTAL MONTHLY COST INCLUDING
PST
$
315,387.05
$
348,296.50
$
328,000.17
TOTAL ANNUAL COST - ALL BENEFITS
$
3,784,644.60
$
4,179,558.00
$
3,936,002.04
Variance To Current Cost
$
394,913.40
10.4%
$
151,357.44
4.0%
Mosey And Mosey Benefit Plan Consultants
Attachment 2 to
Report LGS-026-21
THE CORPORATION OF THE MUNICIPALITY OF CLARINGTON
All Divisions Combined
November 1, 2021 Renewal
Benefit
Basic Life Insurance
Volume
88,816,500
$
Current
Cost
Monthly
Premium
23,236.91
Renewal
bUn Lite eroposea
Cost Effective
November 1, 2021
Monthly
Premium
%
Adj.
Renewal
$
Negotiated
Cost Effective
November
Monthly
Premium
20,459.50
%
Adj.
-12.0%
$ 21,581.75 -7.0%
Supplemental Life Insurance
14,403,000
1,641.94
1,526.72
-7.0%
1,440.30
-12.0%
Dependent Life
355
2,415.63
2,415.63
0.0%
2,415.63
0.0%
AD&D
88,816,500
1,687.51
1,687.51
0.0%
1,687.51
0.0%
Long Term Disability
1,719,106
66,226.21
77,480.50
17.0%
70,196.23
6.0%
Extended Health Care
Single
56
8,033.56
8,917.26
8,033.56
Couple
134
38,624.03
42,872.37
38,624.03
Family
225
83,968.85
93,205.66
11.0%
83,968.85
0.0%
Dental
Single
56
3,597.63
3,957.47
3,766.67
Couple
134
17,236.18
18,959.74
18,046.70
Family
225
45,356.60
49,892.15
10.0%
47,488.76
4.7%
TOTAL MONTHLY PREMIUM
$
292,025.05
$
322,496.76
$
296,127.74
TOTAL MONTHLY COST INCLUDING
PST
$
315,387.05
$
348,296.50
$
319,817.96
TOTAL ANNUAL COST - ALL BENEFITS
$
3,784,644.60
$
4,179,558.00
$
3,837,815.52
Variance To Current Cost
$
394,913.40
10.4%
$
53,170.92
1.4%
Mosey And Mosey Benefit Plan Consultants