HomeMy WebLinkAbout4.03 Select Dental Plan~ oo- ~
CITY OF DUBLIN
AGENDA STATEMENT
CITY COUNCIL MEETING DATE: September 25, 1989
SUBJECT . Selection of New Dental Insurance Program ._
Q~ Prepared by Paul S. Rankin, Assistant City Manager ~~~
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EXHIBITS ATTACHED . o Proposal received from Delta Dental
o Proposed Resolution
RECONII~DATION ~f~~` Adopt Resolution .and authorize Staff to execute any
~i documents required to implement the new program
effective October 1, 1989
FINANCIAL STATEMENT: The new program will have increased premiums as
discussed below. The 1989-90 budget was based upon
full family coverage. Given the current dependent
status of the City's employee pool, the increase
should be accommodated without any adjustment to the
budget.
DESCRIPTION . The City currently obtains dental insurance coverage
for employees from the ABAG Benefits Trust. This is a self-insured program~,,
comprised of several public agencies. The City of Dublin only participates
in the dental program, although the Benefits Trust also offers health
insurance coverage.
ABAG Benefits Trust (ABT) Status
As a self-insured program, ABAG Benefits Trust (ABT) has been strugglin.g
with soaring medical costs within the health program. In order to cover
these costs, premiums had to be increased. Many of the employees covered ~iy
this health insurance selected less costly plans offered by their employer.
If this scenario were to continue, ABT's costs would continue rising without
an adequate premium base to support the expenses. Therefore, the ABAG Boar~d
of Directors elected to discontinue the program effective September 30,
1989.
At one point, there was consideration of continuing the dental program an
its own. However, the consultants hired by ABT indicated that th.e
administrative costs would impact the feasibility of a dental only program.
The City received the final notification of the discontinuation in earl.y
September.
Proposals
Staff requested proposals directly from three providers and one broker. The
size of the City's Staff limits the number of programs which will present a
program.
Staff reviewed three proposals. One was developed by a Joint Powers
Authority in Southern California. This program had a high deductible ($SO
for an individual and $150 for a family) and the coverage did not provide
100~ payment of preventative services. This is the benefit level under the
City's current program.
The City also received a proposal from California Dental Health Program
(CDHP). This proposal has two components, one where the employee selects
their o~an dentist and a second where the employee chooses a"panel
provider". The locations of the panel providers were extremely limited.
Staff was also concerned that the company refused to cover any orthodontia
treatments currently underway. In addition, all future covered orthodontia
patents would be required to obtain services from a panel provider. The
nearest location for orthodontia is currently Castro Valley. Based on a
review of the proposal, it appeared that neither one was consistent with the
coverage being replaced and the one presented by the Joint Powers Authority.
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ITEM N0. ~ °~ ' y
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AGENDA STATEMENT: Selection of New Dental Insurance Program
Page 2
Delta Dental Plan of California
The proposal submitted by Delta Dental and attached to this report most
closely represents the coverage being replaced. This program will also
present the least amount of change to the City's current employees. Delt~a
is a significant provider of these benefits with 5.5 million enrollees and
16,000 dentists who pre-file their fees with the company.
Delta has also agreed to assume any remaining orthodontia liability fo:r
employees who have dependents currently undergoing treatment. For e•r.ample,
the City's current coverage has a$1,000 lifetime benefit for orthodonti~3
services. (Only dependents under age 19 are eligible for this benefit.) I:E
the City's current insurance has already paid $400 on a case, Delta will pa:y
the remaining $600 as costs are incurred. This is extremely important a;s
several employees have dependents currently undergoing treatment. Delta ha;~
also agreed to credit any deductibles already met by employees.
Differences
Delta has established two requirements which were not part of the AB'P
program. The first requirement is that 100$ of the premium must be paid b:~
the employer, This is a condition which is placed on all groups smalle:r
than 100 employees. If the employee is required to contribute the industr~~
has found that the participation rate drops and the premium may not cove:r
expenses. ~
The second requirement is that for all new employees, they will not be
eligible to submit a claim until after 3 months of continuous enrollment.
This requirement has been waived for current employees.
A feature included in the Delta proposal is a rate guarantee for a two yea_c
contract period. This would assure the City that the rate will not chang~:
until October 1, 1991.
Delta Proqram
Staff is recommending implementation of Program II outlined in the Delt~3
proposal. This program has the following features:
Deductible: Individual $25/year - Family Maximum of $75/year
Diagnostic & Preventative: 100~ covered with no deductible
Other Basic Services: 80~ covered
Crowns & Cast Restorations: 50~ covered
Prosthodontics: 50~ covered
The monthly rates for this program compared to our current ABT coverage are
as follows:
ABT DELTA
One Party $ 17.67 $ 25.61
Two Party 41.22 48.36
Three Party + 55.07 81.93
The major cost difference is incurred with the family coverage. The
differences in the first two categories are Iess than $8.00 per month. The
current make up of the City's organization will minimize the significant
cost difference in the family rate.
Implementation
In order to implement the program,
Employee Benefit Plan. Staff
accomplish this task. The primary
from $55.07 to $81.93 per month.
allow coverage to be extended t~
anticipates that these costs can bE
the City Council will need to amend the
has prepared a Resolution which will
change modifies the maximum contribution
The Resolution has also been modified to
> members of the City Council. Staf.f
accommodated in the approved budget.
Recommendation
Staff recommends that the City Council adopt the Resolution and authorizE~
Staff to implement the new Dental Insurancz Program with Delta Dental Plaii
effective October 1, 1989.
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Delta Dental Plan of California ~; ~ C~ ~ V L- D
Augvst 23, 1989
~U G 2 5 1989
c~+'r c~F ~ua~i~
ldr. Pavl S. Rankin
Assistant City Manager
CITY OF DDBLIN
P.O. Box 2340
Dublin, CA 94568
RE: CITY OF DITBLIN
PRQSPSCT
DB3T Mr. Rankin:
Thar_k you for your interest in De1ta Dental Plan of California. It is a plea-
sure to send the enclosed proposal in response to uour recent request.
De1ta will assume coverage of an y orthodontic treatment in progress. A case
h?story wi11 be required and the amounts, if any, paid towards the patient`s
lifetime maximum wi11 need to be documented by the previous carrier. If the
lifetime maximum has not been met by the previous carrier, De.Zta wi11 assume
the remainin g balance.
Treatment plans, other than orthodontics, commenced prior to termination or
coverage with the previous carrier, wi11 be the responsibility of the previous
ca rri er .
Credit wi1.Z be given for deductibles met in 1489 under prior carriers, when
pac.-ment of those deductibles can be documented.
De1ta's stan dard Zimitations & excZusions wi11 be appZied to this contract.
For example, fu11 mouth x-rays wi11 have a five uear limitation instead of the
current 2 year limitation.
Please ca1l if you have an y questions or concerns.
Sincerely,
DSLTA DENTAL PLAN OF CALIFORNIA
/'/L~~-~jl /~~------
Karen London
Account ExecUtive
Northern California
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DELTA
P ROP O SAL
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CITY OF DaBLIN
Delta Dental Plan of California .
DELTA DENTAL PLAN OF CALIPOIiNIA
11-Point Guarantee
1) Delta guarantees the pattent portfon as well as the amount the program will pay. This
unique program feature [s available because more than 18,000 participating member
dentLsts prefile their usual fees with Delta.
2) When you sign a contract with Delta, we guarantee rates will not change during the
contract period, including the portion of your rates charged for administration.
3) Delta will guarantee a one- or two-year term of rates for new groups.
4) Our De1ta programs guarantee that your employees can visit any dentist in the world
and expect coverage. This dilfers from some other carriers, which may require that
patients attend only panel dentists, who may not be conveniently located.
5) If a patient wents to Imow his or her tinancial responsibility in advance of proposed
treatment (especially it the work will be extensive), the dentist can send a form to
Delta tor predetermina[ton of benefits. Delta guarantees payment based o~ the
computations.
6) Delta subscribers who visit one of our member dentists (more than 90 percent of
Calitornia's dentists belong to Deita) will not have to fill out a treatment form-the
dental office does it for them. Also, we guarantee they will not be charged for forms
completion.
7) Delta programs ensure quality dental care through the routine use ot dentist
evaluation of treatment plans as an integrai part ot payment processing. Also, our
regfonal dentist consultants regularly conduct pre- and post-trentment clinicni
examtnat(ons of pattents selected at random, as another way of assuring qunltty enre.
8) Another aspect ot our quality assurnnce ls the Peer Revtew process. if e peUent
questlons the quallty of cace prov[ded or disagrees with treatment provided, we will
reLer the dispute to a review committee o[ a locnl dental society to impartially
resolve any differences and will abide by the final descision of Peer Review.
9) Fligibility control is guaranteed through our on-line patlent eligibility system. Your
monthly list of eligible employees is all we need to assure full eligibility control with
no further paperwork for you.
10) Our history cross-check procedures are a way oP guaranteeing that the payments we
make out of group Punds are compared to our on-line history for each group subscriber.
This system identifies duplicate services or those outside the terms oP the contract.
11) Unlike its competitors, Delta guarantees it will pay the same copayment percentage
whether you see s participating member specialist or a general dentist, even though
specialists frequently charge more for their services.
C~
DELTA DENTAL PI.AN OF CALIPOBIdIA
... a not-tor-profit servtce organization founded in 1955
... nearly 5.5 million Cnlifornians slready enrolled
... more than 16,000 member dentists
... recognized by the American Dental Association as the leader in
prepaid dental care
. . . can be used worldwide
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WTfH A DELTA PROGRAM, YOII CAN EXPECT:
iT CONTAIZiMENT - Thmugh ihe jolIowing mea,wrex
1) Exact filed fees: Delta has current fees - NOT a profile
2) Patient guarantee: Delta guarantees patient copayment percentage
3) Total costs: Delta cuts total costs instead of inerely shifting them. to the
patient
4) Computer history: Designed to identify duplicate services or those outside the I'I
terms of the contract
5) Employer dc employee costs: No fee for forms. No handling of forms for
employer and employee.
ALITY ASSIIRANCE - Through our:
1) Professional review: Full time dentists review claims ,
2) Regional consultants: Pre- and post-treatment cllntcal screenings by 350 i
dentists throughout the state i
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3) Regular qunlity surveys: Letters sent to dentists and patients ~
4) Peer review: By Peer Review Committee of local dental societies '
5) Dental office audits: Regular audits in the field.
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ADVANTAGES OF DELTA PROGRAMS
TO THE EMPLOYER:
Cost Control
Multi-choice/flexibility in program design
Time-tested rate structures
More than 30 years actuarial experience
No claim Porms; simple billing
Quality care
Less loss of work time because of better dental health
Recruitment incentive
Increases employee satisfaction and morale ~
Alternate delivery of benefits from one company
TO TIiH EMPLOYEE:
Free choice of dentist
Strong quslity assurance program
Fees prefiled; preapproved for member dentists
Guaranteed copayment - both sides
Dentist completes claim forms - no charge
Predetermination - voluntary
Notice of Payment - sent directly to patient
Fewer financial worries because of smaller bills
Alternnte delivery programs avnilable
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FACTS OF IN'.^EREST
DELTA DENTAL PLAN OP CALIFORNIA
A SUERMARY
Under Delta's fee-for-service programs, we pay the uppropriate copayment to the
ntist, based on his own fees Por each covered service provided. Ne assume the risk of
tential losses i[ morr_ pntients thnn nnticipated require extensive work. Undcr n closed
nel program, the administrntor usunlly pnys the dentist a fee for cach fnmily to covcr the
sts oP all services which muy be incurred, making the dentist himself nssume the risk.
ould more patients than expected need treatment, dentists then must either 1) nbsorb the
tra costs, °) perform fewer services, or 3) use less expensive procedures and mnterials.
Delta is in a unique position to help prevent the prnctice of overbilling, which occurs
~en a dentist bi1Ls higher than his actual fees, knowing thnt a dental carrier will pay the
1. The dentist then will for~ive the putient's portion of the bill, acceptin~ the cnrrier's
^tion as payment in full. Overbilling cnn incrense utilization of [he dental plnn, thereby
~pardizing a group`s esperience. Because of Delta's progrum of dentnl ofCice Qudits, it can
tect when a dentist is overbilling, and take approprinte action under its membership
-eements to control the problem.
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^ Our cost control features ensure the most coverage for your benefit dallars.
^ By offering tailor-mnde benefits we give you the flexibility to design s prr ~~ to
meet your unique needs.
^ Our thirty years of experience offer a realistic basis for your budget planning.
^ Through our extensive quslity assurance mechanisms, we provide you with the highest
level of employee satisfactton.
^ Our slmpie billing procedures and the freedom we offer from filling out claim iorms
mean easy administration for you.
^ We guarantee copayments, and issue predetermination and notices of payment so there
will be no confusion or unpleasant surprises for subscribers.
^ With [he most value for the dollar and maximum employee satisfaction, it's no surprise
that Delta is the nation's largest dental plan and the leader in dental benefits
administration.
^ Alternutive dcIIvery (Dual Choice) nvAilnble through Ph1i.
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PROPOSED PROGRANS
AHD lfONTHLY RATES
PROP0.SED PROCRAtLS
Program I Usual, Customary and Reasonable Fee Concept
Co-Payment - Diaqnostic 6 Preventiva: IOOZ"
Othoc Uasir: DO/20
Crowns s Casc Restorations: 50/50
Prosthodontics: 50/50
'S25 deductible per patient per calendar year
.~ith a S75 aggregate maximum deduc:ible per
family per calendar year
51,000 maximum per patient per calendar year
Program II Usua1, Customary and Reasonable Fee Concept
Co-Payment - Diagnoscic 6 Preventive: 1000'
Other Basic: 80/20
Crowns 6 Cast Restorations: 50/50
Prosthodontics: SU/50
"Prosthodontics only following 12 months of
continuovs enraZlment
"525 deducti6le pez patient per calendar year
with a S75 aggregate maximum deductible per
family per calendar year
51,000 maximum per patient per calendar year
~~lo deductibZe on Di~gnostic 6 Preventive
"'Waived for initial enroIlees
NOHTKLY RATES ONE PJIRTY TNO PIIRTY THREE P11RTY+
Program Z 525.6I 598.08 $76.39
Program ZZ 525.38 $47.64 S75.93
PROP0.5~D ORTHODqYTIC PR~iXS
PROPQSSD PROGRAXS
Pmgram I Usua1, Customary and Reasonable Fee Concept
Orthodontics for nligible dQpeaden[ children
Co-Ya ~ent - Orthodontics: 50%
S1,000 lifetime ma.rimum per patient
Program ZI Usual, Customary and Reasonable Fee Concept
Orthodontics for eligible dependent children
Co-Payment - Orthodontics: 50~
51,000 lifetime maximum per patient
Orthodontics only following 12 months of continuous
enrollment (waived for initial enroI2ees) - No
deductible
XQ4T9LY RATES A9S PAR17 2Sr0 PARTY THRSS PARTY+
Program I SD.00 50.82 56.83
Program II $0.00 50.72 56.00
ELIGIBILITY: No Change
S72S CATECORY: 25 - 49 &mployees
NQA1-V07.DIVTARY DBPSNDENTS
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RATES APD SLZGIBIISTY
RATSS
The rates are guaranteed for a two year contract period and are contingent
upon the employer contributing the entiro cost for a1Z eligible employees and
dependents.
SLrGrarrzrr
A11 Permanen[ fu11-time empZoyees and their eligible dependents are covered on
the first of the month folZowing three (3) months of continuous enrollment with
a minimum of 32 hours per week. These terms of eligibility apply for a group
of 25 - 49 employees.
These rates Zisted aze vaZid if a contract ~s signed wi[h ninety (90) days.
A fuZ1 description of benefits, Zimitations and exclusions is available in a
sample contract.
SCOPE OF BENEFITS
Z. DIAGNOSTZC AND PREVENTIVE BENEFITS
Diaqnostic: oral e:camination
x-rays
study models
biopsy/tissue examination
emergency palliative treatment
specialist consultant
Preventive: prophylaxis (cleaning)
fluoride treatment
space maintainers
II. BASIC BENEFITS
Ora1 Surgery - e~ctractions and certain other surgical pro-
cedures, including pre-and post-opezative
- ' care.
Restorative - amalgam, synthetic porcelain and plastic
restorations (fillings) for treatment of
carious lesions (visible destruction oi
hard tooth structure resulting from the
process of dental decay).
Endodontic - treatment of the tooth pulp.
Periodontic - treatment of gums and bones supoorting t 'i.
III. CROWNS, JACKETS AND CAST RESTORATION BENEFIT
Crowns, Jackets and Cast Restorations for treatment of cs-
rious lesions (visible destruction of hard tooth structure
resulting from the process of dental decay? whic`~ cannot be _
restored with amalgam, synthetic porcelain or plastic res-
torations.
IV. PROSTHODONTIC BENEFITS
Procedures for construction or repair of fixed bridges,
partial or complete dentures. ~
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RESOLUTION NO. - 89
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF DUBLIN
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AMENDING SECTION 3 OF THE BENEFIT PLAN
ADOPTED BY RESOLUTION NO. 75-89 (DENTAL INSURANCE)
WHEREAS, on June 26, 1989, the Dublin City Council
adopted Resolution No. 75-89, Adopting a Benefit Plan; and
WHEREAS, Section 3 of said Resolution identified the
maximum contribution by the City towards employee dental
insurance; and ~
WHEREAS, the amount contributed represented 100g of the
cost for family coverage provided by ABAG Benefits Trust (ABT);
and
WHEREAS, ABT has announced that they will be
discontinuing the coverage effective September 30, 1989; and
WHEREAS, the City Council recognizes that the provision
of certain benefits is important to the retention of quality
personnel.
NOW, THEREFORE, BE IT RESOLVED that Section 3 of
Resolution No. 75-89 shall be modified to read as follows:
Section 3. Dental Insurance: Beginning with the
October, 1989 premium, the City will contribute on behalf of each
employee scheduled to regularly work at least 30 hours per week,
or any member of the City Council, a maximum of $81.93 per month
to a dental insurance plan selected by the City.
PASSED, APPROVED AND ADOPTED this 25th day of September,
1989.
AYES:
NOES:
ABSENT;
Mayor
ATTEST:
City Clerk
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