Explanation
BACKGROUND: To maintain the insurance programs in accordance with the negotiated labor contracts, it is necessary to modify and extend the existing contract with United Health Care of Ohio, and to provide additional appropriation for the continuation of the medical insurance program. Additional appropriation is needed due to higher than projected medical claims.
In February 2003, $37.2 million was appropriated to United Health Care; however, to date claim costs have exceeded $27.4 million thereby necessitating additional appropriation to meet anticipated annual expenses. Total projected expense is $41.2 million for 2003, year to date $37.2 million has been appropriated, therefore an additional $4 million is needed. The additional appropriation and modification of contract does not require additional cash funding. Cash funding is available in the total Employee Benefits Fund for all insurance subfunds.
FISCAL IMPACT: No fiscal impact; funding is available to modify and extend the existing contract with United Health Care of Ohio, to increase the maximum obligation liability, and to authorize the expenditure of $4 million for United Health Care of Ohio through January 31, 2004, and to provide additional appropriations for medical claims expenses. Funding is available for this modification in the Employee Benefits Fund. This ordinance is an emergency measure to ensure insurance coverage as negotiated by union contracts.
Title
To authorize the City Auditor to appropriate $4 million from within the unappropriated balance of the Employee Benefits Fund; to authorize the Human Resources Director to modify and extend the contract with United Health Care to provide all employees with medical insurance coverage through January 31, 2004, and to authorize the expenditure of $4 million from the Employee Benefits Fund, or so much thereof as may be necessary to pay the costs of said contract; and to declare an emergency. ($4, 000,000.)
Body
WHEREAS, it is in the best interest of the City of Columbus to modify and extend the contract to provide all eligible employees medical insurance through January 31, 2004; and
WHEREAS, it is necessary to authorize the expenditure of $4 million ; or so much thereof as may be necessary to pay contract costs for group medical coverage; and
WHEREAS, it is necessary to authorize the appropriation of $4 million; or so much thereof as may be necessary to pay contract costs for medical coverage from the unappropriated balance of the Employee Benefits Fund; and
WHEREAS, an emergency exists in the usual daily operation of the City of Columbus in that it is immediately necessary for aforementioned purpose for the preservation of the public health, peace, property, safety, and welfare; Now, Therefore,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS
SECTION 1. That the City Auditor is hereby authorized and directed to appropriate the sum of $4 million to the Employee Benefits Fund, from the unappropriated funds in the Employee Benefits Fund and all monies estimated to come into said fund from any and all sources, and unappropriated for any other purpose.
SECTION 2. That the Human Resources Director is hereby authorized to modify and extend the contract with United Health Care of Ohio (EA017197), to provide all eligible employees medical insurance coverage through January 31, 2004.
SECTION 3. That the expenditure and appropriation of $4 million, or so much thereof as may be necessary for coverage from the Employee Benefits Fund 502, Subfund 208, Department of Human Resources 46-01, OL1-- 03, OL3-- 3363, OCA 461024, Amount $4,000,000.
SECTION 4. That for the reasons stated in the preamble hereto, which is hereby made a part hereof, this ordinance is declared to be an emergency measure and shall take effect and be in force from and after its passage and approval by the Mayor or ten days after passage, if the Mayor neither approves nor vetoes the same.