SR 10-10-2023 5G
City Council
Report
City Council Meeting: October 10, 2023
Agenda Item: 5.G
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To: Mayor and City Council
From: Lori Gentles, Chief People Officer, Human Resources Department
Subject: Approval of Agreement with Trustmark for Long Term Care Insurance
Coverage
Recommended Action
Staff recommends that the City Council:
1. Adopt a finding of no possibility of significant effect pursuant to Section
15061(b)(3) (Common Sense Exemption) of the California Environmental Quality
Act (CEQA) Guidelines; and
2. Authorize the City Manager to negotiate and execute an agreement with
Trustmark for Long-Term Care (LTC) insurance coverage for a period of 5 years
with one additional one-year option for the Human Resources Department. This
is a no cost contract to the City with an estimated value of $240,000. All services
are paid by the plan participants, who are employees that voluntarily elect to
obtain LTC coverage.
Summary
AB 567 (Calderon, Chapter 746, Statutes of 2019) established the Long-Term Care
(LTC) Insurance Task Force (Task Force) in the California Department of Insurance to
explore the feasibility of developing and implementing a culturally competent statewide
insurance program for long-term care services and support. As part of the City’s
employee benefits program, the City would like to provide Long-Term Care coverage to
staff to address the need for accessible and comprehensive eldercare services due to
an aging population with limited assets and significant Long-Term Care needs. All
premiums and fees relating to the services are voluntary and borne by plan participants,
not the City. Health and disability insurance exclude LTC services, Medicare offers
minimal coverage, and Medicaid typically requires individuals to be below a certain
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income to qualify. Very few people own private LTC coverage, and many carriers have
exited the market.
Discussion
The state of California is considering legislation to mandate long term care insurance
through a state-run program with funding from taxes (e.g., payroll tax). In 2021,
Washington became the first state to adopt a mandatory, State-run LTC insurance
program. California’s LTC Task Force mission is to explore a statewide insurance
program for LTC services and support. Plan participants who elect to receive this
benefit may have the opportunity to opt out of the payroll tax. These benefits may be
used for a range of services, including professional care at home or at a licensed
facility; training, pay and support for family members who provide care; memory care;
home-delivered meals; rides to a health care provider; adaptive equipment and
technology; home safety evaluation; and emergency alert devices.
Due to many insurers having exited the LTC market, there are few carriers who provide
this benefit. As a result, The City worked with its broker, Alliant, to assess available
carriers’ customer base, pricing, and solvency. Of those carriers, the City looked at its
employee base and cost of premiums to determine the best long-term option. Trustmark
provides two-tiers offering greater affordability and equity based on varying benefits,
including a guaranteed issue LTC benefit available for employer groups in California.
Trustmark gives employees the most cost-effective option and a Universal Life Policy
that builds equity. The fund will be supported by a premium paid by employees only.
This procedure is consistent with the City’s informal bidding process as set forth in
Santa Monica Municipal Code Section 2.24.210. The informal bidding process is
appropriate due to the estimated value of the contract not exceeding $250,000. Staff
has elected to present this agreement to the City Council for approval to ensure
maximum transparency due to the nature of the services that will result in additional
employee benefits on a voluntary basis.
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Environmental Impact
The agreement for Long-Term Care insurance coverage is exempt pursuant to Section
15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act
(CEQA) Guidelines, which states that CEQA does not apply, where it can be seen with
certainty that there is no possibility that the activity in question may have a significant
effect on the environment. The agreement would provide administrative services to the
City and would not result in physical effects. No further environmental review is
necessary.
Financial Impacts and Budget Actions
There is no immediate financial impact or budget action necessary as a result of
recommended action. All premiums and fees relating to the services are voluntary and
borne by plan participants, not the City.
Prepared By: Sasha Sargent, Executive Administrative Assistant
Approved
Forwarded to Council
Attachments:
A. OAKS INITIATIVE FORM 10.04.2023
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CITY OF SANTA MONICA OAKS INITIATIVE NOTICE
NOTICE TO APPLICANTS, BIDDERS, PROPOSERS
AND OTHERS SEEKING DISCRETIONARY PERMITS, CONTRACTS,
OR OTHER BENEFITS FROM THE CITY OF SANTA MONICA
Santa Monica’s voters adopted a City Charter amendment commonly known
as the Oaks Initiative. The Oaks Initiative requires the City to provide this notice and
information about the Initiative’s requirements. You may obtain a full copy of the
Initiative’s text from the City Clerk.
This information is required by City Charter Article XXII—Taxpayer Protection.
It prohibits a public official from receiving, and a person or entity from conferring,
specified personal benefits or campaign advantages from a person or entity after
the official votes, or otherwise takes official action, to award a “public benefit” to that
person or entity. The prohibition applies within and outside of the geographical
boundaries of Santa Monica.
All persons or entities applying or receiving public benefits from the City of
Santa Monica shall provide the names of trustees, directors, partners, and officers,
and names of persons with more than a 10% equity, participation or revenue
interest. An exception exists for persons serving in those capacities as volunteers,
without compensation, for organizations exempt from income taxes under Section
501(c)(3), (4), or (6), of the Internal Revenue Code. However, this exception does not
apply if the organization is a political committee or controls political committees.
Examples of a “public benefit” include public contracts to provide goods or services
worth more than $25,000 or a land use approval worth more than $25,000 over a 12-
month period.
In order to facilitate compliance with the requirements of the Oaks Initiative,
the City compiles and maintains certain information. That information includes the
name of any person or persons who is seeking a “public benefit.” If the “public benefit”
is sought by an entity, rather than an individual person, the information includes the
name of every person who is: (a) trustee, (b) director, (c) partner, (d) officer, or has
(e) more than a ten percent interest in the entity. Therefore, if you are seeking a
“public benefit” covered by the Oaks Initiative, you must supply that information on
the Oaks Initiative Disclosure Form. This information must be updated and supplied
every 12 months.
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Packet Pg. 359 Attachment: OAKS INITIATIVE FORM 10.04.2023 (5994 : Long Term Care Insurance Agreement)
CITY OF SANTA MONICA
OAKS INITIATIVE DISCLOSURE FORM
In order to facilitate compliance with the requirements of the Oaks Initiative, the
City compiles and maintains certain information. That information includes the
name of any person or persons who is seeking a “public benefit.” If the “public
benefit” is sought by an entity, rather than an individual person, the information
includes the name of every person who is: (a) trustee, (b) director, (c) partner, (d)
officer, or has (e) more than a ten percent interest in the entity.
Public benefits include:
1.Personal services contracts in excess of $25,000 over any 12-month period;
2.Sale of material, equipment or supplies to the City in excess of $25,000 over a
12-month period;
3.Purchase, sale or lease of real property to or from the City in excess of
$25,000 over a 12- month period;
4.Non-competitive franchise awards with gross revenue of $50,000 or more
in any 12-month period;
5.Land use variance, special use permit, or other exception to an established
land use plan, where the decision has a value in excess of $25,000;
6.Tax “abatement, exception, or benefit” of a value in excess of $5,000 in any
12-month period; or
7.Payment of “cash or specie” of a net value to the recipient of $10,000 in any
12-month period.
Name(s) of persons or entities receiving public benefit:
Name(s) of trustees, directors, partners, and officers:
Name(s) of persons with more than a 10% equity, participation, or revenue interest:
Prepared by: Title:
Signature: Date:
Email: Phone:
Permit #
FOR CITY USE ONLY:
Bid/PO/Contract #
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Packet Pg. 360 Attachment: OAKS INITIATIVE FORM 10.04.2023 (5994 : Long Term Care Insurance Agreement)