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June 25, 2002
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SUBJECT: |
Renewal of Employee Assistance Program/Work Life Contract for Fiscal Year 2002/2003 |
REPORT IN BRIEF
This report recommends the renewal of the existing contract between the City of Sunnyvale and Managed Health Network, Inc. (MHN) for employee assistance program (EAP) and work/life services to be effective July 1, 2002 for one year. The new rates propose a combined increase of nine percent (9%).
BACKGROUND
As part of its employee benefit package, the City of Sunnyvale provides full-time and part-time regular employees including those in the Reduced Time Job Status Program with an employee assistance and work/life program. The contract expires on June 30, 2002. Market surveys to find alternative providers have consistently shown that the cost and level of service provided by MHN has been superior.
DISCUSSION
Marsh Risk and Insurance Services (Marsh) is the City's benefits insurance broker and is charged with negotiating benefit contract rates, including the one for EAP and Work/Life Program, on behalf of the City Of Sunnyvale.
Marsh reviewed the initial proposed rates at 12.5% for EAP and 5% for work-life. These rates were being proposed to trend impacts, largely due to the September 11 events and the increase in the utilization noted at a 19.8 intake activity, up 9% up from 18.2%, the norm is 8%. The utilization also noted a 15.3% open case activity, up 6% from the former 14.6%, the norm is 5.5% an the usage of other supplemental services such as brown bag seminars, job performance referrals and critical incident debriefings. Due to the long relationship of the City with MHN, Marsh was able to negotiate a combined increase of 9% for one year.
This is a program, as demonstrated by the high demand, that is utilized by employees and is an important benefit which addresses issues/problems that can affect employee performance, productivity, attitude and morale. and attitude.
The EAP program provides for up to 7 sessions per employee and for each dependent with marital, family, alcohol/drug, financial/credit concerns, tax assistance, legal issues and emotional problems including those found at work.
The Work Life program, provided in conjunction with the EAP provides access through the internet or by phone and includes online assessments and interventions, personal assistance, nutrition, childcare referral services and information in other areas that affect the employee balance of life and work.
FISCAL IMPACT
The current number of employees covered is 911, the current monthly rate is $5.68 for the Employee Assistance Program increasing to $6.19 and the rate of $1.40 for the Work/Life Program will remain at $1.40. A total projected annual cost for this combined program is $82,974.
Funding for this expenditure is provided in the Benefits Fund and the cost of the contract renewal has been provided for in the Fiscal Year 2002-03 Base Budget.
PUBLIC CONTACT
Public Contact was made through posting of the Council agenda on the City's official notice bulletin board, posting of the agenda and report on the City's web page, and the availability of the report in the Library and the City Clerk's Office.
ALTERNATIVES
RECOMMENDATION
Alternative #1; renew the MHN contract to continue providing the EAP and Work/ Life services.
Prepared by:
Myriam Castaneda
Human Resources Supervisor
Reviewed by:
Mark Gregersen
Director, Human Resources
Approved by:
Robert S. LaSala
City Manager
Attachments
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