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HomeMy WebLinkAbout2002-004 Health Insurance for the City CITY OF CHUBBUCK, IDAHO RESOLUTION No. 4 -2002 WHEREAS, The health insurance coverage for the City was converted to a self-insurance arrangement effective April 1, 2002; WHEREAS, certain employees within the City qualify for Medicare supplemental coverage provided they are not otherwise covered by a insurance plan; WHEREAS, some individuals desire to waive coverage under the City's self insured plan because they desire Medicare supplemental coverage; WHEREAS, the City desires to provide some benefit for those individuals that waive the City's self insurance. NOW, THEREFORE, BE IT RESOLVED by the Mayor and City Council of the City of Chubbuck as follows: The Medical Expense Reimbursement Plan - Limited attached hereto is ratified and adopted by the City of Chubbuck effective April 1, 2002. The City Clerk and Treasurer is designated as the Medical Expense Reimbursement Plan Administrator, PASSED BY THE COUNCIL AND APPROVED BX THE MAYOR ON NOVEII/IBERl,92002. John O. Cotant, Mayor ATTEST: Ron C, Conlin, City Clerk RESOLUTION __ - 2002 -Page 1. chubbuckl 1,14z CITY OF CHUBBUCK MEDICAL EXPENSE REIMBURSEMENT PLAN - LIMITED This MEDICAL EXPENSE REIMBURSEMENT PLAN - LIMITED (the "Plan") is adopted by the City of Chubbuck (the "Employer"), effective April 1, 2002. SECTION 1. REIMBURSEMENT. Upon the effective date, any Eligible Employee (as defined in Section 3 hereof) shall be eligible for reimbursement by the Employer for cost of other medical insurance paid for by the employee or the employee's dependents if the employee has waived coverage under the medical insurance plan offered by the City to that employee for that employee or that employee's dependents. The benefit shall be limited to reimbursement of a maximum of One Hundred Fifty Dollars ($150) per month for an Eligible Employee if that Eligible Employee has waived coverage under the City's medical insurance plan and/or $150 per month for the dependents of an Eligible Employee (taken as a group and not individually) if the Eligible Employee has waived coverage for those dependents under the City's medical insurance plan, had those dependents been eligible to participate in that insurance plan offered by the City. SECTION 2. DIRECT PAYMENT OPTION. The Employer may, in its discretion, reimburse costs directly to the person or company providing such alternative medical insurance, in lieu of reimbursing the eligible Employee after his or her payment thereof. In such event, the Employer shall be relieved of all further responsibility with respect to that particular medical premium. SECTION 3. ELIGIBILITY FOR EMPLOYEE COVERAGE. Notwithstanding any other provisions of this plan, an Eligible Employee must be a citizen or a resident alien of the United States of America. All current employees are "Eligible Employees" if, on the date the plan is adopted, the employee has completed 36 months of service with Employer and is 25 years of age or more. Any employee of the Employer hired subsequent to the date of adoption of this Plan shall become an "Eligible Employee" on the first day of the corporation's taxable year coinciding with or next following the date Employee has both attained age 25, and has completed 36 months of continuous full-time employment with the Employer. An employee shall thereafter remain an "Eligible Employee" until the first of the following events occurs: (A) The employee's status as an employee terminates; (B) The employee leaves the Employer's employ for any reason. MEDICAL EXPENSE REIMBURSEMENT PLAN - LIMITED - Page 1 blj chubbuck06.111 .wpd For purposes of this Section, "employee" is defined to include all common law employees of the Employer who customarily work at least 35 hours per week and at least 9 months per year. Additionally, to be an Eligible Employee, the employee must have waived coverage under the medical insurance plan offered by the City to its employees and the dependents of those employees. If the waiver is for the employee, then that employee is eligible for reimbursement of the cost of alternative medical insurance paid for or procured for that employee. If the waiver is for the dependents of the employee, then that employee is eligible for reimbursement of the cost of alternative medical insurance paid for or procured for those dependents. SECTION 4. SPOUSE AND DEPENDENT COVERAGE. The medical insurance expense incurred by the spouse and dependents of an Eligible Employee (as defined in Section 152 of the Internal Revenue Code of 1986, as amended) shall also be covered by this Plan, subject to the limitations described in Sections 1 and 8 hereof. SECTION 5. ADMINISTRATION. A person designated by Employer shall be the Medical Expense Reimbursement Plan Administrator (the "Administrator") who shall be responsible for administering the Plan. The Administrator's actions in connection with the Plan shall be binding on all persons. SECTION 6. REIMBURSEMENT CLAIM PROCEDURE. (A) The Administrator, upon request, shall make claim forms available to all Eligible Employees which shall require the filing of such pertinent information, documentation or evidence of medical expenses as the Administrator deems necessary, which information, once submitted, shall remain in the files of the Employer and shall remain confidential. The only grounds for disallowance by the Administrator of any claim made by an Eligible Employee hereunder shall be that the charges are insured (as defined in Section 8 hereof) that they are unreasonably high (in which case the reasonable part shall be allowed), or that the annual benefits limitation has been reached. Claims must be submitted to the Administrator no later than four months following the calendar year in which the expenses were incurred. Expenses in excess of the annual benefits limitation may be carded forward for only one taxable year of the Employer beyond the year in which the limitation was reached, and shall be charged against the annual limitation for the year to which they are carried. (B) Reimbursement by Employer shall be made periodically as determined by the Administrator; provided, however, reimbursement amounts shall be paid no less than annually. MEDICAL EXPENSE REIMBURSEMENT PLAN - LIMITED - Page 2 blj chubbuck06.111 .wpd SECTION 7. EMPLOYEE CONTRIBUTIONS. No contributions are required of any Eligible Employee to assure his or her coverage or that of his or her spouse and dependents hereunder. The City shall pay the entire cost of all reimbursements allowed by the Administrator and all expenses arising in connection with the administration of the Plan. However, this Section shall in no way preclude the adoption by the Employer of a program of insured accident and health benefits for its employees, and their spouses and dependents, to which the employees may be required to contribute. SECTION 8. REIMBURSEMENT ONLY FOR THE COST OF INSURANCE Reimbursement will be made hereunder only to the extent that cost of the insurance coverage for medical care is not provided for-under any self-insured or insured plan of the Employer or any other employer, or under Medicare or other Federal or State law. In addition, an Eligible Employee shall seek to collect under any such other program first, if possible, before applying for reimbursement from the Employer hereunder. To the extent of coverage under any such other program, the Employer shall be relieved of all liability hereunder with respect to such expenses. SECTION 9. REIMBURSEMENT AFTER DEATH. Any amount payable hereunder to an Eligible Employee who dies prior to payment may be paid in any one or more of the following ways as the Administrator, in his or her sole discretion, elects: (A) To such person's surviving spouse; (B) To such person's duly appointed legal representative; (C) To such person's heirs (pursuant to a statutory affidavit, if appropriate). SECTION 10. NONASSIGNABILITY OF BENEFITS. Any amount payable to or on behalf of an Eligible Employee hereunder may be applied by the Employer towards settlement of any debt of such individual to the Employer, but shall not be subject to the claims of any- other creditors of the Eligible Employee, and shall not be subject to assignment or encumbrance by the Eligible Employee. SECTION 11. QUALIFICATION INTENDED. It is the Employer's intention that benefits payable hereunder be eligible for exclusion from the gross income of the Eligible Employees on whose behalf they are paid, as provided in Section 105 of the Internal Revenue Code of 1986, as amended. In the event such an exclusion is disallowed by the Internal Revenue Service with respect to a particular Eligible Employee, the non-excluded sums reimbursed on his or her behalf hereunder shall be considered to be additional compensation to such Eligible Employee. MEDICAL EXPENSE REIMBURSEMENT PLAN - LIMITED - Page 3 blj chubbuck06.111 .wpd SECTION 12. NO EMPLOYMENT GUARANTEE. This Plan shall in no event be construed to constitute a contract of initial or continued employment with the Employer or an assurance of any benefit not contained expressly in this Plan. SECTION 13. AMENDMENT AND TERMINATION. The Employer reserves the right to amend and/or terminate this Plan at any time or times; provided, however, that any such amendment or termination shall not affect an Eligible Employee's right to reimbursement for expenses filed prior to such amendment or termination. IN WITNESS WHEREOF, the Employer has caused this Plan to be adopted effective April 1; 20'02: ............. CITY OF CHUBBUCK -John O, C6t/rnt, Mayor MEDICAL EXPENSE REIMBURSEMENT PLAN - LIMITED - Page 4 blj chubbuck06.111 .wpd