Title
Retiree Health Savings Plan Administrative Services Agreement with ICMA-RC (B)
This item involves a request for the City Commission to approve the Administrative Services Agreement with ICMA-RC as it applies to the City of Gainesville Retiree Health Savings Plan.
Explanation
In January 2002, the City of Gainesville began implementation of the Retiree Health Savings Plan (RHS) administered by ICMA-RC. The ICMA-RC Vantagecare Retirement Health Savings Plan was developed by ICMA-RC as a vehicle to allow employees to accumulate assets in a tax-free plan to pay for post-employment medical, dental and vision expenses including the retirees' portion of the health insurance premium. The plan was implemented to help employees prepare for the increased cost of health care as a retiree.
Each account holder pays an administrative fee from his or her account balance, to ICMA-RC. The administrative fees are part of the Administrative Services Agreement. ICMA-RC has requested that the City update the Administrative Services Agreement to include a new fee structure. The new structure will lower the annual account fee to those account holders with lower account balances by five dollars per year. In addition, the annual account fee will not be applied to any account holder who is not benefit eligible. The current plan allows benefit eligibility at retirement or age 55.
Fiscal Note
There is no fiscal impact to the City of Gainesville, as account fees are paid for by each account holder.
Recommendation
The City Commission: 1) authorize the City Manager or his designee to negotiate and execute the Administrative Services Contract with ICMA-RC subject to approval from the City Attorney as to form and legality.
Alternative Recommendation:
The RHS plan is a proprietary product of ICMA-RC and therefore utilizing another vendor is not an option at this time. Theoretically, the City could design its own plan and go through a private letter ruli...
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