COUNCIL OF THE CITY OF PHILADELPHIA JOINT PUBLIC HEARING BEFORE THE COUNCIL COMMITTEES ON COMMERCE & ECONOMIC DEVELOPMENT AND LAW & GOVERNMENT - - - Room 400, City Hall Philadelphia, Pennsylvania Thursday, May 21, 1998 11:18 a.m. - - - Resolution No. 970845 - Authorizing Committee on Commerce and Economic Development to hold hearings investigating the provisions of contract between the City of Philadelphia and the Rite Aid Corporation on the prescription drug plan for all City employees. Resolution No. 970850 - Authorizing Council's Committee on Law and Government to conduct a full and comprehensive investigation of the City's health insurance plans offered to non-represented and fair-share employees and elected officials for the 1998 calendar year. PRESENT: COUNCILMAN MICHAEL A. NUTTER, Chairman COUNCILWOMAN JANNIE BLACKWELL COUNCILMAN DAVID COHEN COUNCILWOMAN DONNA REED MILLER COUNCILWOMAN HAPPY FERNANDEZ COUNCILWOMAN MARIAN B. TASCO COUNCILMAN FRANK DICICCO COUNCILMAN ANGEL L. ORTIZ COUNCILMAN RICHARD T. MARIANO COUNCILMAN FRANK RIZZO - - - VINCENT VARALLO ASSOCIATES, INC. Registered Professional Reporters Eleven Penn Center, Suite 600 Philadelphia, PA 19103 (215) 561-2220 2 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 I N D E X Bill No. 970845 David Volpe . . . . . . . . . . . . . . . . . First Deputy City Controller of Philadelphia 6 Linda Volpe, Personnel Director . . . . . . . 31 City of Philadelphia Elliot Gurson, Senior Vice President, . . . . 88 General Counsel, Secretary, Rite Aid Corporation Edward Hushen, Regional Market Manager. . . . 109 Rite Aid Corporation Sam Brog, Independent Pharmacist, . . . . . . 174 Exec. Dir., Philadelphia Assoc. Retail Druggists Frances Gallagher, M.S. Patient . . . . . . . 213 Clerk Typist II - City of Philadelphia 3 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586
Good morning, ladies and gentlemen. This is a joint hearing of the Committees on Commerce and Economic Development, and Law and Government. I'm Councilman Nutter, Chair of the Commerce and Economic Development Committee. We're anticipating Councilman Cohen, Chair of the Law and Government Committee shortly. To my left is committee member Councilwoman Blackwell. And on the other side of the room is Councilman Ortiz. We're going to start today's hearings on Resolution No. 970845. Resolution 980152 will be held today, and we may also take testimony on Resolution 970850. What we'll do is ask the clerk of the Commerce and Economic Development Committee to read the titles of both resolutions that we're going to hear today.
Resolution No. 970845, a resolution Authorizing Committee on Commerce and Economic Development to hold hearings investigating the provisions of contract between the City of Philadelphia and the Rite Aid Corporation on the prescription drug plan for all 4 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 City employees, including but not limited to: copayment fees per prescription and any terms relating to allowable increases in these copayment fees; contract requirements related to customer service standards and customer complaint resolution procedures; and all contract terms, conditions and renewal provisions; and investigating the lack of information provided to City employees about changes made in fees, services, and contract terms, including but not limited to: copayment fees per prescription and any terms relating to allowable increases in these copayment fees; contract requirements related to customer service standards and customer complaint resolution procedures; and all contract terms, conditions and renewal provisions; and investigating the lack of information provided to City employees about changes made in fees, services, and contract terms. And Resolution No. 970850, authorizing Council's Committee on Law and Government to conduct a full and comprehensive investigation of the City's health insurance plans offered to non-represented and fair-share employees and 5 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 elected officials for the 1998 calendar year; particularly with regard to the increases that will be imposed in the 1998 plans and a variety of copay deductible and co-insurance fees over the equivalent fees contained in the 1997 plans; and with respect to widespread allegations that have been made regarding interference by managed-care providers in general and Aetna U.S. Health Care in particular with the doctor-patient relationship as it affects both members of the general public and City officials and employees; and authorizing the Committee, in furtherance of such investigation, to issue such subpoenas as may be necessary to compel the attendance of witnesses and the production of documents to the full authorized under Section 2-401 of the Home Rule Charter..
Thank you very much. Our first witness for Resolution 970845 is Mr. David Volpe Deputy City Controller. Mr. Volpe, please come to the table. (David Volpe comes forward.)
Mr. Volpe, please identify yourself for the record, and you can 6 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 begin your testimony.
Thank you, Mr. Chairman and members of the committee. My name is David Volpe. I'm the First Deputy City Controller of Philadelphia. And I'm here today in my capacity as Trustee on the Board of Pensions and Retirement, serving on behalf of the Controller, to provide testimony on Resolution No. 970845 regarding the contract between Rite Aid Corporation and the City of Philadelphia and the relationship between the City of Philadelphia and certain pension members. Two specifics issues related to --
Mr. Volpe, hold on. I'm sorry to interrupt you. We're having some kind of mechanical problem. I'm having difficulty hearing you. Why don't you bring the microphone a little closer, and we'll try to do --
Again, I'm here today to talk about the contract between the Rite Aid 7 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 Corporation and the City of Philadelphia, and the relationship between the City of Philadelphia and selected pension groups. Two specifics issuing related to Rite Aid's prescription coverage for selected groups of pensioners are of particular concern to me. These relate to: (1) the high cost of prescription coverage for pensioners no longer covered under the City-paid benefit plans; and (2) the inability of these pensioners to opt out of the Rite Aid prescription coverage and still receive health coverage from the City. Retirees receiving prescription plan coverage through the City fall into two groups: The first group is comprised of former employees retired less than four years. The City pays the full cost of health care and prescription plan coverage for this group of retirees. On the prescription side, the City pays a composite fee of $65 per month per family to Rite Aid to purchase a prescription plan. The second group is made up of former employees retired four years or more. These retirees are left on their own when it comes to 8 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 securing and paying for health and prescription coverage. There are currently 564 pensioners paying the retirement system; and, hence, the City, for post-retirement health and prescription coverage. Because these former employees have been retired four years or more, they are no 9 longer eligible for City-paid coverage. I will refer to these former employees as "post-City-credit retirees" as I go on. The post-City-credit retirees face a daunting challenge: find and pay for affordable yet comprehensive health and prescription coverage. Unfortunately, the City does not do many favors for these employees when it comes to offering affordable prescription plan coverage. I noted earlier that the City pays a composite fee of $65 per family per month to cover the cost of prescription coverage for employees retired less than four years. The cost to retirees is nothing. 96 per person -- that's per person per month. This means that a post-City-credit husband and 9 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 wife will pay virtually double what the City pays with no added benefit. For a pensioner with a wife and a dependent child. The cost could be three or even four times what the City pays the day after the four-year City-covered period ends. And it is not like these pensioners get that much for their dollar. Coverage is capped at $1500 per person per year, which is an increase from what it used to be. Three years ago, the Rite Aid plan limit was $800 per person, meaning that some families were paying in more than what they were receiving in terms of prescription coverage. And, as I note, that has changed. The other problem with the health plan offered our hundreds of post-City-credit pensioners is that these folks cannot drop out of the Rite Aid prescription plan and keep one of the City-offered health-care plans. Under the present system, the employee obtains health care through the City, he or she must pay for the prescription benefit from Rite Aid. This impact impacts retirees aged $65 and older the worst. These individuals, many of 10 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 whom rely exclusively on their City pensions and Social Security for income, could opt for a Medicare supplement with either of the City-offered HMOs which offers a prescription benefit of $1500 per person at little or no cost. However, under the present arrangement with Rite Aid, the pensioners cannot drop the Rite Aid prescription plan without also losing their health-care coverage. To me, this seems like a patently unfair way to be treating our retirees. These are people of limited means paying on their own for the cost of their health and prescription coverage. To remedy this situation, we need to do two things at a minimum.
First, negotiate a more equitable for post-City-credit retirees with Rite Aid. It doesn't seem fair to have the City pay a composite rate of $65 per family to Rite Aid one year and then make pensioners pay double this amount the next year. And it cannot cost Rite Aid that much, especially when the $1500 coverage cap is considered. Second, we need to allow employees to opt out of the Rite Aid prescription plan when 11 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 selecting coverage. Nothing I am recommending should cost the City one dime. We owe to it our retirees to offer them the best and most cost-efficient health and prescription plans their money can buy. And I thank you for your consideration.
Thank you very much for your testimony. Mr. Volpe, have you had discussions with either the personnel director or Rite Aid representatives about your concerns in the articulate way that you've laid them out today?
In the past, the Pension Board and myself have talked to the City about this. A number of years, I made reference in my testimony to the cap that was on the prescriptions of $800. That's been changed, so that was a positive. And then very recently, I talked to Linda Seyda, and she says that she does believe that there is some way to allow the pensioners to opt out of the Rite Aid prescription coverage, which would be an absolute positive, because it is very unfortunate for these people. 12 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 They must -- if they select the City's offered health-care coverage, offered health-care coverage, and pay for that, they are locked into the Rite Aid; when, quite possibly, there are cheaper plans out there, especially through the HMOs. Some of these HMOs have very affordable plans -- prescription plans.
Now, this kind of locked-in situation, is that for all retirees, regardless of what either branch of the government or representative or non-representative status they may have had when they were active employees?
This group is primarily non-represented employees. Firefighters, police etc., other union members oftentimes go through their own, the union coverage. Some drop out, and if drop out, they would go into this.
Okay. One quick item of housekeeping. Councilman Cohen has arrived, the Chair of the Committee on Law and Government. And to my right is Councilwoman Fernandez, Councilwoman Donna Miller and Councilman Mariano, who have also joined the table 13 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 here. Please continue.
Okay. Will be sure -- the personnel director and the Rite Aid representatives are here. We'll be sure to follow up on the items that you have mentioned. I don't know if you're able to stay. You might want to hear the responses. Are there any other questions for Mr. Volpe by members of the joint committees? (No questions.)
Do any of the unions representing City employees cover retirees beyond the four-year period?
Yes. Different unions have different plans for retirees. 14 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586
I have some general understanding. I don't have a list or anything like that of what the --
Do we have a right to inquire of the unions what their terms are?
Then I'd like to find that because I'd like to out how different groups of City employees fare. It seems to me to be an anarchistic system that makes no sense to have totally different rules applying for different people. And if we're going to have that, at least everybody ought to be brought up to the maximum level. Now, to what extent has the City disputed with Rite Aid the cost that they charge employees after the four-year period? Has the City taken a firm position with Rite Aid and said that under no circumstance must you charge these outrageous price; and if you do, we will not contract with you? What do you know 15 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 about that?
I really can't answer that. I do know that the City did take a proactive stance on the cap that was on the prescription limit and did get Rite Aid to -- I believe the City and/or Rite Aid did increase that, and that was a positive. On the current issue --
It used to be three, four years ago that these retirees, these post-City-credit retirees, they paid in for their prescription plan coverage. And their coverage limit, in terms of the amount of prescriptions they could purchase, was limited to $800 or something like that per person per year. That was increased to $1500 per person per year. So that was a positive. In terms of any negotiations or any conversations with Rite Aid related to the issues I'm raising, I'm not sure which have occurred. I do know that this could be as much a City issue as it is a Rite Aid issue, so that's --
Well, that's what 16 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 we're trying to establish.
Because all we know is the City kept all of its policies totally secretive so that nobody knows anything, and has permitted a system to develop where different retirees get different kinds of post-retirement benefits; despite the fact that all of them were under the illusion at one time that they worked for the City of Philadelphia and, therefore, were entitled to certain basic rights.
Now, it also seems as if the City at various times has put the responsibility on retirees rather than accepting it, but we don't know who sets the rates. When I say "we," I'm speaking of exempt people.
We know there've been a 500 percent increase in the cost of Rite Aid prescriptions in the few years, as far as the 17 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 employees are concerned, who are exempt. We started -- I guess it was a big sales pitch, please don't object to this agreement with Rite Aid, we're only going to charge $1 per prescription. It's now $5. That's a 500 percent increase. So I think it's an absolutely outrageous increase. On the other side, the cost of paying doctors has also increased, but we don't know whose fault it is. It could have been the City saying, Oh, if you gotta charge more, let's dump it on the employees instead of the City assuming an obligation. Or it could have been at Rite Aid. These hearings are for the purpose of finding out what the facts are. We don't have a final conclusion because we don't know what the fact are. So we're asking your office, which we regard as the watch dog on behalf of all City employees, we're asking that you get together the information, and perhaps be prepared, Mr. Cochairman, to present it at a subsequent hearing.
So that we'll get a firm grounding on what the situation is. And from 18 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 that, you know, we can then move forward.
Sure. We will attempt to gather the information in terms of the different union coverage that's out there. You know, this is something in the past that we recommended years ago that they collapse the different union plans into a City plan. We believe that would be much more efficient. And I think, if you're asking the personnel director, she would agree wholeheartedly with that, and she would --
Well, that may be. But in the area where the City has had responsibility, the City seems to have done an absolutely atrocious job because the City seems to have no interest in the retirees and seems to be willing to put heavier burdens on them rather than assuming its rightful obligation to people who are former employees. So I don't see -- I don't see this as a major problem, trying to compel the unions to fold into one plan. That might be good, but it may or may not be possible, you know, based upon collective bargaining standards that have been 19 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 applied. But I would like to see that at least in the area that the City has the responsibility that's kind of shared, that the employees are not kept in the dark and confronted with decisions already made as if we had no rights. Because, otherwise, I'm going to be proposing that City Council, which is a separate legislative body, develop its own plans. We don't have to go with the City, meaning the City Administration's plan. We're our own legislative body. And I don't see why our employees should be subject to a plan that seems basically unfair. So that's the reason we need all of the facts. And the problem in my mind is just to find out what the unions do because, apparently, we may gain some very valuable input. I think they've probably done a far better job than the City has insofar as the employees are concerned, you know, in protecting the rights of employees.
That's possible. I mean, these plans are private plans. We pay a per-month per-head charge to the unions for this type of 20 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 coverage. And then they basically, other than having some oversight in terms of a trust, you know, that normally is created where we normally have one or two members from the Administration or the City government in terms of oversight. It is separated; it isn't like it used to be five or six years ago when the City paid an amount, and that's what it was, and then we could go in and audit it and do certain things. We really can't do that anymore. You're paying them a per-diem charge.
Well, we'd like to know what it is because there may be legislation that we want to propose that helps everybody in this situation. Because the present situation is madness. Let me ask you one further question. Do I read your -- I'm sorry I was a bit late because of another conference, but do I read your statement correctly that for post-retirees, the post-retirees are charged by companies doing business with the City on the basis of 58.96 per person per month?
That's correct, that's 21 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 correct.
Per person? You know, if somebody still has children they're still responsible for?
If they had a dependent child -- and there are a few that have that -- they would be charged per person.
And I don't know why we'd want to do business with a company that would have a policy like that.
I actually wanted to explore that area myself, Mr. Volpe.
Thank you. Mr. Volpe, you went through the testimony and I'm literally now just understanding that fine point that you're making. For the active employee, the City pays 22 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 $65 per member per month; is that correct?
Well, that -- I'm not sure if that's the active employee. That's really the employee who the City is paying for the first four years after retirement.
Forget about retirement. I believe the current figure for the '98 contract is proposed to be $65 per member per month.
Then you go into retiree status, and it continues at the $65 per member per month for four years; is that correct?
And once you leave the four-year post-active or are now in the retirement phase of your life, if you have other members of your family at home and they want to be 23 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 covered, you would end up paying $58.96 for each covered person; is that correct?
So you could go from the City paying -- your testimony is the City pays $65 per month for the whole family while they're working and for four years post-retirement. Then the person pays out of their pocket $58.96 for them and possibly a spouse or other dependents in the household.
And you -- so, you know, $56.98 sounds like 116, 117 a month just for those two people so --
I do not know. This is 24 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 something we talked about at the Pension Board. You know, as a trustee and as the other trustees, we get feedback from the pensioners, and they're upset about this. And that's -- I'm not here to criticize Rite Aid or criticize the City; I'm here to give you information based on what I believe is inequitable treatment of these employees. I just don't feel it's fair for them.
Councilman Nutter, just a comment. I think we've found out how there's -- how the financing for the proliferation of these drug stores have occurred. I think we've gotten to the source of the money needed to finance those.
We may have. And did I also understand your testimony to be that these post-retirement people, after the four years, are -- if they continue to want to have City plan health coverage, they have to stay in the Rite Aid system?
If they opt out of Rite Aid for their prescriptions, they can not 25 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 have City coverage anymore?
Would you go over that again? I heard that the first time, and I was kind of startled by that even more so.
If a person retires and they wish to keep City health coverage with, I guess, one of the HMOs --
-- which -- do they pay for -- they don't pay for the first four years?
After the four-year period, if they wish to continue to have City health coverage, they have to participate in the Rite Aid prescription drug program. If they try COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 to opt out of the Rite Aid prescription drug program, then they cannot keep City coverage.
That's a pretty sweet deal, it seems to me -- not for the employee but for Rite Aid.
Is there anything else for Mr. Volpe? Councilwoman Fernandez.
I just want to clarify on the -- after the four years, when it --
That's why they have to keep things secret, apparently.
When it kicks in that the retiree would pay $58.96 per person per month, is that essentially their copay?
To get, then, any kind of prescriptions they want?
But then 27 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 later, when it says that coverage is capped at $1500 per person, does the coverage mean the value of the prescriptions that they buy?
Okay. Because that's different from the copay that City employees have where you pay this -- now it's the $5 for whatever prescription you get.
Councilwoman, I'm not sure what the copay is for these employees, to be perfectly honest. And I should.
The Councilwoman raises a very interesting point because I don't know whether we know or not if those people also have to pay a copay.
One question. Who dictates the plan in that sense? Is it Rite Aid or the City?
Well, it's the City's plan. The City would negotiate with whatever provider is 28 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 out there -- in this case Rite Aid -- for prescription coverage.
Well, in essence, Rite Aid's saying the City offered this plan, and Rite Aid came in and bought that plan, bought into it, offered their bid and said, We'll go along with your plan. This is the City's plan.
Could I just pursue again? I'm just having trouble with --
If after the four years, a retiree chooses to pay for the City health plan in general, the employee has to accept the Rite Aid prescription plan? Now. Is that at 56 --
You mean the City is demanding that people have to pay that amount to Rite Aid in order to maintain the City plan?
They are coupled; you can't 29 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 separate them. If you're going to take a City-sponsors HMO, for example, you must select the Rite Aid prescription plan.
It's unbelievable that the City would enter into such an agreement or make such a requirement. I don't -- if Councilman Ortiz is right, it's the City that sets the plans up, and the companies just bid on the plans proffered by the City.
Councilwoman Miller, I think, wants to ask a question.
Hi. Councilwoman Miller. I have one question. Does the post-retirement and the retirement impact all City employees, or does unions have like separate agreements?
They normally have separate plans that they sponsor for their former 30 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 employees. This is mainly non-represented City employees and union dropouts, of which there's a little under 600 currently. And it's been going down, I think it's being -- the number has been going down because I think they see that this is not the greatest plan so. . .
Well, how's the union plan working? I mean, is it different?
There are a variety of different union plans. There's -- the FOP sponsors plans through the LEHP and through PFMA. District Council 47 has plans. There are different plans that are out this.
There are a couple of outstanding -- I mean there are certainly tons of questions, but I would like to ask Miss Seyda to come up. (Linda Seyda comes forward.)
And Councilwoman Fernandez opened up a line of questioning which, I think it's unclear about retirees and per-person 31 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 per-month costs as well as the prospect of copay as well as the tie-in between City-sponsored health plans and the requirement of Rite Aid prescription drug plan participation. Miss Seyda, if you could identify yourself for the record and. . .
Good morning. My name is Linda Seyda, and I'm the Personnel Director for the City.
I don't think we heard any of that. Why don't want you -- all right.
My name is Linda Seyda, and I am the Personnel Director for the City of Philadelphia.
Good morning, Miss Seyda. I'm sure you have your own testimony, but we'd like to keep some consistency to the record. You were in the back listening. Can you provide some explanation and clarification on the per-member per-month fees that are charged for active or employees who are in their post-retirement but in the four-year window? 32 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 And then the distinction made for post-four-year employees and the per-person per-month charge as well as the requirement of City-sponsored health plan coverage tied into Rite Aid prescription plan coverage as well as any copay that the post-four-year person may to pay.
Okay. For those employees who are in the first four years of their retirement period, they are covered in the same way as active employees. And that is consistent with the City's agreement with the employee organizations, in that the City contribution for health and welfare payments to the unions for the active employees is the same for the four-year employees. So the City makes a contribution to the union for active employees and post-four-year employees.
All right, stop right there. A person retires. When they were active, the City was paying $65 per month per employee for the prescription program and THEN were making whatever contribution in the amount 33 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 they were making for health-care coverage, right?
And was the employee paying for any of their health-care coverage during the active period?
They would be paying the same thing that they would have been paying as an active employee. So if they were enrolled in a plan that required an employee contribution as an active employee, that same employee contribution would carry over into the four-year retiree period.
Okay. But if you're in an HMO, you essentially don't really pay anything, right?
All right. So you leave active service, you go into now this four-window, the City continues to make the same contribution. And if the employee was paying something as an active employee for health-care coverage, they would continue to pay the same. If they were in an HMO and they're not paying anything, they would continue not to pay anything. 34 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586
Now, what happens after the four-year window to that same employee?
After four years, the employee has the option to continue receiving coverage through the City -- through the City plan, but there is no City contribution.
All right. So what does it cost that now-retired more-than-four-year employee, what does it start to cost them for health-care coverage? On average?
The cost would be whatever the City is paying the health-care provider. That -- that varies from plan to plan. On average --
Give us an example. Take U.S. Health Care, for example.
Sure. Do you have a list that would show all of the various plans? I mean, the sheet that you're reading from is it going to go down. . .
The -- for the Blue Cross Personal Choice plan, for example, depending upon 35 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 whether the coverage is for a single person, single-plus-one, or family, the cost ranges from $241 to $693 for a family member on a composite basis. That's $$418 per member per month.
Yeah, you lost me a little bit on that. Take us back through that again. Single coverage was. . . ?
Single coverage for the Personal Choice program is $241 per person per month.
Okay. So the single employee retires, it's now four years later, they start paying $200+ a month for their health-care coverage.
And then you gave a 36 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586 -- you said something about a composite per person per month. That was the part I got lost on.
Yeah. The composite rate that the City pays for all of its employees as a group is $418 per month.
Okay, so now what exactly does the person pay? Do they pay the $200 figure, do they pay the $600 figure, do they pay the composite of 418?
If they're paying for it themselves, it's on a tiered basis. So that a single employee would pay the $240.
'Cause it just wouldn't -- it wouldn't be fair to have a single employee pay the composite rate of $418.
All right. Well, who pays $418? Does the family person pay 418??
If the City was paying the bill for the active employee -. 37 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586
All right, so you retire and you have your family -- you have family coverage, you pay the 600-some-odd dollar figure?
Okay. Now, and tied into that, you now want prescription coverage.
That would be, you know, as Mr. Volpe testified, I believe it was --
So somehow if it's four people in this family, it's $58.96 times 4?
That could happen. I mean, there's -- at that point, there are very few retirees who have dependents. But, yes, that -- you are correct.
That may be the extreme. 38 COMMERCE & ECONOMIC DEVELOPMENT - BILL NO. 970586
All right. And let's say it's $58.96 times 2, so more than likely, they are also paying for single -- they're not paying for single-plus-one health coverage, or could they?
All right, right. And that figure, again, was single-plus-one? Don't flip back. It's somewhere between two and six. All right, now --
436. All right, so it's 436 for the health coverage, and it sounds like 117 or so for the prescription coverage.