DEPARTMENT: Human Resources
FILE TYPE: Consent Action
TITLE
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Authorization To Approve Vendors And Rates For 2027 Group Short-term Disability, Long-Term Disability, Life Insurance, Family And Medical Leave Act, And Vision
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RESOLUTION
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WHEREAS, Minn. Stat. § 471.6161 requires public sector employers to request proposals for group insurance plans; and
WHEREAS, proposals were received from three carriers for group life insurance, Family and Medical Leave Act (FMLA) administration, and Short and Long-term Disability benefits; and
WHEREAS, proposals were received from five carriers for group vision insurance; and
WHEREAS, together with Deloitte Consulting, staff have reviewed the proposals received and related financial implications of each proposal; and
WHEREAS, Standard Insurance Company offers a 36.8% premium reduction in County paid basic life insurance benefits and held current employee-paid voluntary supplemental life insurance rates with a three-year rate guarantee; and
WHEREAS, Standard Insurance Company offers an 18.4% premium reduction, and rates are guaranteed for three years for the employee-paid Long-term Disability Plan; and
WHEREAS, staff recommend continuing to contract with Standard Insurance Company to administer the FMLA administration, employee paid Short-Term Disability, Long- Term Disability; and
WHEREAS, Standard Insurance Company offers a three-year rate guarantee holding current rates for county paid FMLA and Short-Term Disability administration; and
WHEREAS, Deloitte consulting performed an actuarial valuation of the Short-Term Disability reserves vs. claims and is recommending holding current rates for the employee paid Short-Term Disability premiums into 2027; and
WHEREAS, staff recommend continuing to contract with VSP Vision Care to administer the employee paid vision benefit; and
WHEREAS, VSP Vision Care offers a five-year rate guarantee holding current rates until December 31, 2030.
NOW, THEREFORE, BE IT RESOLVED, That the Dakota County Board of Commissioners hereby authorizes the County Manager, or delegate, to contract for 2027- 2029, Life Insurance, FMLA administration, Short-Term and Long -Term Disability administration with Standard Insurance Company; and
BE IT FURTHER RESOLVED, That the Dakota County Board of Commissioners hereby authorizes the County Manager, or delegate, to contract with VSP Vision Care for 2027-20231 vision plan benefits.
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BACKGROUND
Minn. Stat. § 471.6161 requires public sector employers to request proposals for group insurance plans every 60 months. Last request for proposal process was in 2021 for 2022 benefit year. Together with Deloitte Consulting, staff have reviewed the proposals received and related financial implications of each proposal and made a specific recommendation.
Group Life and Disability
Together with Deloitte, staff recommends renewing contract with Standard Insurance Company for life insurance, FMLA administration, short-term disability administration, and long-term disability insurance.
Short Term Disability Plan
The County offers one employee-paid Short-Term disability plan. The Short-Term Disability plan is designed to offset the Minnesota Paid Leave (MNPL) payments and provide up to 60% partial wage replacement for up to 6 months, if medically necessary.
The recommendation is to continue to contract with Standard Insurance Company to administer this benefit. The Standard Insurance Company administrative fees are not increasing and being held for three years. Deloitte has completed an actuarial analysis of the Short-Term Disability self- insured plan reserves vs. claims; recommendation is to continue the current employee premium rate for 2027.
Vision
Together with Deloitte, staff recommend renewing the contract with VSP Vision Care, employee premiums are being held at current rate for five years.
RECOMMENDATION
recommendation
Staff recommends approval.
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FINANCIAL AND STAFFING IMPACTS
County costs are reflected in the County Manager recommended 2027 budget.
PREVIOUS BOARD ACTION
None.
ATTACHMENTS
Attachment: Deloitte Consulting 2027 Short-Term Disability Renewal Letter
Attachment: 2027 Vision Summary and Rates
Attachment: RBA Contract Summary Sheet Standard Insurance Company
Attachment: RBA Contract Summary Sheet VSP Vision
CONTACT
Department Director: Andy Benish
Author: Shannon Welle