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JUNE 7, 2011 MINUTESCITY OF VIRGINIA BEACH "COMMUNITY FOR A LIFETIME" CITY COUNCIL ~ -`_ .,, ~'~ Z G~ a U~~ ._'I P MAYOR WILLIAM D. SGSSOMS, JR , At-Largm ' ~` ~: ~' u VICE MAYOR LOUIS R. JONES, Baysrde - Disrric(J o ;. : IUTASI4'EE1'BELL17"I'O,AI-Large +, ~a.~-- - mt ~s GL ENN R. DAMS, Rase Hal! - District 3 °` °°a ~~"° N~/LLIAMR. DeS7LPH, Ar-Large HAIU2Y E. DIEZEL, Kempsville - District 2 ROBERT M DYGR„ Centerville -District 1 BARBARA M HENLEY, Princess Anne - Distric( 7 JOHN F.. UHRIN, Beach -District 6 ROSEMARY WILSON, At-Large CITY HALL BUILDING JAMF;S L. WOOD, L ynnhaven -District 5 2401 COURTHOUSE DRIVE VIRGINIA BEACH, VIRG/NIA 23456-8005 CITY COUNCIL APPOINTEES PHONE: (757) 385-4303 C'1 %'Y MANAGER-.IAMESK. SPORL•' FAX (757) 385-5669 CITYATTORNEY- MARK D. STILES E- MAIL: ctycncl@vbgov.corn CITY ASSESSOR - JERALD D. BANAGAN CITYAUDITOR - LYNDON S. REMIAS CITY CLERK - RUTH HODGF.S ERASER, MMC CITY COUNCIL WORKSHOP AGENDA 07 JUNE 2011 JOINT CITY COUNCIL/SCHOOL BOARD -Building 19 - 4:00 PM A. HEALTH CARE UPDATE Linda Matkins, Director of Benefits -City/Schools Consolidated Benefits Office Ken Jeffries, Mercer II. CITY COUNCIL -Building 1, Conference Room - 5:00 PM A. AQUARIUM and OWL CREEK MASTER PLAN Lynn Clements, Director -Museums Ned Williams, Chair -Virginia Aquarium and Marine Science Center Foundation Brian Solis, Planning, Design and Development Administrator -Parks and Recreation -1- MINUTES VIRGINIA BEACH CITY COUNCIL Virginia Beach, Virginia June 7, 2011 Mayor William D. Sessoms, Jr., called to order the JOINT CITY COUNCIL/SCHOOL BOARD WORKSHOP re HEALTH CARE UPDATE in the Conference Room of Building 19, Tuesday, June 7, 2011, at 4:00 P.M. Council Members Present: Rita S. Bellitto, Glenn R. Davis, William R. "Bill " DeSteph, Harry E. Diezel, Robert M. Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Absent: None School Board Members Present: Vice Chairman William J. "Bill " Brunke, Dr. Todd C. Davidson, Emma L. Davis, Chairman Daniel D. Edwards, Dottie Holtz, Brent N. McKenzie, Ashley K. McLeod, Sam Reid, Patrick S. Salyer, Sandra Smith-Jones and Carolyn D. Weems School Board Members Absent: None June 7, 2011 -2- HEALTH CARE UPDATE 4:00 P.M. Chairman Edwards introduced Ferrell E. Hanzaker, Chief Financial Off cer and lead person on the Benefits Executive Committee. Mr. Hanzaker advised both he and Assistant City Manager Susan Walston (Retired) Co-Chaired the Benefits Executive Committee. Linda Matkins, Director of the Consolidated Benefits O~ce and Ken Jeffries -Principal Mercer Consultant, detailed the update. Agenda - Health Care Goals - Experience/Projections - Health Care Fund Update - Health Care Initiatives/Results - Health Care RFP - Next Steps Health Care Goals - Offer affordable, quality health care as part of a total compensation package - Control costs by managing the health care trend and reducing the GASB 45 liability - Maintain a healthy and productive workforce - Achieve best prices for goods and services - Focus on health risks that are significant cost drivers - Promote a culture of change and accountability - Promote health awareness, education and involvement of enrollees in their health and wellness Mr. Jeffries advised for 2010, the City's Health Plan experienced a trend of approximately 10%, which is around national averages. On a National basis, there have been trends of approximately 11 %, I1. S% for plans that do not have plan design changes for 2010. Those who had plan design changes and tried to mitigate their cost ran about 8%, 8.5%. The City's plan made no changes in 2010, so it is closer to that National level. Experience/Projections 2010 Trend - Experienced a 10% increase in trend 2011 Plan Changes - Plan Changes • Grandfathered Status • Removal of Lifetime Limits • Removal of Annual Limits for Essential Benefits • Dependent coverage extended to age 26 (f no access to other group coverage) - Contribution Strategy - No changes 2011 Projection - 10% Trend June 7, 2011 -3- HEALTH CARE UPDATE Health plan clairns cost trend - historic~l end for~c~st~d Health plan trend on rise STOo Sfi50 8600 s i g55o E U 8600 - ga60 5Y00 5]50 $]00 VA BEACH HISTORICAL AND PROJECTED TOTAL INCURRED CLAIMS PEPM ~'"'03 2003 JnD1 2004 JanDS 2D06 'bn°6 2006 ~i°T 2007 'Yn°a 2008'~n°a 2009 ~"-"' 2070•Y077 FOrtKB ~PEPM ~PEPM Aq• B%ireM -i0%TreM -1]%ireM Health Care Fund Update Total Fund Equity 06/30/2009 - $31. SM • City $14.4-Million / 45.7% • Schools $17.1-Million / 54.3% 06/30/2010 - $30.7-Million • City $12.7-Million/ 41.4% • Schools $I8.0-Million/ 58.6% 06/30/2011- Estimated $25.8-Million • City $9.2-Million / 35.7% • Schools $16.6-Million / 64.3% 06/30/2012 -Estimated $3-8-Million Enrollment as of 1/1/2011- Schools 61.5% /City 38.5% 12.0% trentl t0.0Y trend 8.D% frrnd June 7, 2011 -4- HEALTH CARE UPDATE wF> > ~vF.cr a ~vn PRF. vF.NT1ON PROGRAMS Disease and Condition Management ~~ Health Education ^ Cardiovascular Disease Management Onsite Classes Program ^ Diabetes Disease Management Program ^ Respiratory Disease Management Program ^ "Partners in Pregnancy" Prenatal Program Fitness Programs Support Services ^ Fitness Incentive Tracking Program (FIT) Care Management ^ WalkAbout Employee Assistance Program ^ Tobacco Cessation Program Screenings and Vaccinations Weight Management ^ Cancer Screening Initiatives Eating for Life ^ Flu Shot Clinics Maintain Don't Gain ^ Health Screenings Weight Watchers ^ Personal Health Profile Screenings and Vaccinations ^ Cancer Screening Initiatives ^ Flu Shot Clinics ^ Health Screenings ^ Personal Health Profile Ms. Matkins advised while changes were not made in 2012, the Wellness and Disease Management Program and helping the employees maintain or improve their health status will continue. New Initiatives Programming Created and implemented reduced copay benefit for diabetics, helping to make diabetes medication more affordable and therefore encourage better medication compliance Increased offerings for Health Screenings (cholesterol, blood pressure, BMI) including onsite opportunities and quarterly health fairs Implemented Al c screenings to follow up with employees at risk for diabetes and encouraged physician follow-up Implemented Special Events program encouraging employees to have a wellness initiative integrated into their staff programs. Examples include: Public Works Annual Picnic (800 employees), Public Works and Public Utilities Health and Safety Fair (1700 employees), Library all staff training day (250 city employees) Offered more onsite opportunities including health education classes, health screenings, and Weight Watcher programs Expanded flu shot coverage to spouses covered by our health plan and part time employees Coordinated with Occupation Health to offer Care Management onsite, twice weekly, to work with high risk employees June 7, 2011 -5- HEALTH CARE UPDATE New Initiatives (Continued) Education - Provided educational material and classes on diabetic resources and reduced copay benefit - Created new quarterly Retiree Wellness Update - Provided quarterly Health Fairs throughout the city - Included online wellness resources in 2011 Wellness Guide - Researching prenatal fitness program to offer in 2012 - Provided educational seminar on Health Equity plan - Provided Benefit Seminar Series • "You The Smart Patient" • "Understanding the Alphabet Soup - FSA & HRA " • "Medicare and You " Process Change/Implementation - Developed and utilize Dependent Certification form for 2011 • Provides continued dependent audit procedures • Requires certification of dependent status - Developed and utilize Medicare Eligibility Certification Form for retirees • Provides notification of eligibility for retirees and spouses eligible for Medicare due to disability - Created a system for employees to submit Fitness Incentive Tracking program facility requests - Enhanced Wellness Ambassador designation process - Worked with technology in online program registration for the following programs: Maintain Don't Gain, Weight Watchers and Flu Shots Collaboration - Participate on eValueB Strategic Partnership through Virginia Business Coalition on Health for health plan/employer/provider collaboration - Enhanced collaboration with Occupational health - Enhanced collaboration with Optima Case Management - Participate on the Virginia Business Coalition on Health (VBCH) Wellness Collaboration committee Recognition - Recognized in 2009, 2010 and 2011 by American Heart Association as "Gold Start! Fit-Friendly Company" - Recognized in 1997, 2004 and 2011 by the Virginia Business Coalition on Health, receiving the "Wellness in the Workplace "award. June 7, 2011 -6- CITY MANAGER `S BRIEFING HEALTH CARE UPDATE City and schools Cancer screenings 2007 % Merrrbers 39.6% 20.5% 19.8% 93.8% 6.2% 2010 % Members 91.9% 20.7% 18.8% 12.9% 5.7% 2007 Mernbers Actively Enyayed with Health Coach 176 184 265 736 467 1.8% 3.6°fo 5.4°l> 21.5% 30.2% 2010 Members Activety Engaged wittt Health Coach 430 445 654 913 765 4.1% 8.6% 13.8% 28.1 % 54.0% "-i~. June 7, 2011 Health Stratification History - city ana s~noo~5 Increasing Health Risk -~- CITY MANAGER `S BRIEFING HEALTH CARE UPDATE Ken Jeffries advised the Benefits Executive Committee was tasked with going out and soliciting Requests for Proposals for the Health Plan Administrator for 2012. This was done under the watchful eye of the Procurement office here. Proposals were requested from Aetna, Anthem, CIGNA, Optima, United Healthcare, the big National players and it was a public bid, so anybody who chose to do so could have bid. Two (2) proposals were received from Anthem and Optima (who is the City's current carrier). All other declined, stating they were non competitive in this market. Sentara has a big footprint here, many hospitals and physicians. They also own Optima Health Plan, so they are going to give Optima obviously the most favorable discounts in the market before any other carrier. HEALTH CARE REQUEST FOR PROPOSAL (RFP) RESULTS Request for Proposal Issued for 2012 Plan Year for fully and self-insured options 1 Proposal Requested from: • Aetna • Anthem BCBS • CIGNA • Optima • United Healthcare • Made available to others through advertising • Proposals Received from: • Anthem BOBS • Optima • All others declined to bid stating non-competitive in market 1 Criteria for Selection • The most comprehensive discounts and administrative fees • High quality standards of customer and member service • Quality networks with competitive financial arrangements • Network access to as many employees/retirees and their dependents as possible • Minimal provider disruption and consistent network approach • Proven medical management and disease management programs Financial Analysis Background -claims cost - Impact of the RFP on claims cost • To determine the impact of changing medical vendors, Mercer conducted a vendor discount analysis on in-network medical claims costs o Based on home zip codes for City/VBCPS employees enrolled in the health plan o Utilized Mercer's NetPic tool o Compares vendors ' discounts achieved in areas where City/VBCPS employees reside o Does not consider expected improvement or erosion in vendors 'future discounts - City/VBCPS claim costs are projected to 2012 based on incurred claim data paid through December 2010 and do not reflect any plan design changes • Pharmacy and administrative fees are included for completeness June 7, 2011 -8- CITY MANAGER `S BRIEFING HEALTH CARE UPDATE Financial Analysis Self-Insured Results Best financial proposal for self-insured health plan is Optima Optima produces the lowest medical, pharmacy and administrative costs Switching to Anthem would increase plan costs by approximately $7.1-Million or 5.9% In addition to Optima having the lowest projected medical spend based on known provider discounts in the market, Optima administrative fees are also lower when compared to Anthem Optima has achieved 99.8% accuracy in claims payments. Anthem would not agree to the claims audit as requested. Over the term of a three year contract, Optima administrative fees are approximately $3-Million less than Anthem Financial Analysis Fully Insured Options 1 Anthem and Optima fully insured rates are guaranteed for 1 year only 1 The most competitive fully insured quote was from Anthem 1 Anthem's fully insured quote was $2-Million greater than the projected self insured Optima costs - Anthem was asked to guarantee the fully insured rates for more than one year and declined Fully Insured vs. Self Insured Considerations Financials • Expected increase to current costs by moving to fully insured arrangement ($2-Million in first year) • Unfavorable impact to cash flow in year one (pay run out claims from 2011 in addition to paying full premiums) • Reduced administrative expenses (no premium tax, carrier profit or overhead charges) 1 Plan design changes • Plans would be subject to any state mandates as well as any carrier changes 1 Health care reform • Plan would lose grandfathered status June 7, 2011 -9- CITY MANAGER `S BRIEFING HEALTH CARE UPDATE REQUEST FOR PROPOSAL (RFP) AWARD 1 Health RFP (Request for Proposal) Committee selected Optima under a self insured arrangement • Lowest cost option • Flexibility in plan design • No internal switching cost o Communication o Information technology • Proven reliable partner • Proven track record of improving the health status of our members Ms. Matkins advised the Next Steps for Plan Year 2012. Next Steps 1 Plan Year 2012 - No plan design, carrier, or contribution changes • Adoption of ordinance for 2012 health care (City) -June 14, 2011 • Consolidated Benefits Office finalize materials for open enrollment -July 29, 2011 • Open Enrollment -October 10 -October 30, 2011 - Claims audit for 2010 -August/September 2011 1 Council/Board Briefing for Health Care Strategy for 2013/2014 -August/September 2011 The JOINT CITY COUNCIL/SCHOOL BOARD WORKSHOP ADJOURNED AT 4:42 P.M. June 7, 2011 -10- CITY COUNCIL `S BRIEFING AQUARIUM and OWL CREEK MASTER PLAN S: 00 P.M. Mayor William D. Sessoms, Jr., called to order the CITY COUNCIL WORKSHOP re AQUARIUM and OWL CREEK MASTER PLAN in the City Council Conference Room, Tuesday, June 7, 2011, at S: 00 P. M. The City Manager introduced Lynn Clements, Director -Museums, introduced Ned Williams, Chair - Virginia Aquarium and Marine Science Center Foundation and Brian Solis, Planning, Design and Development Administrator -Parks and Recreation. The Department of Museums is partnering with the Department of Parks and Recreation. June 7, 2011 -11- CITY COUNCIL `S BRIEFING AQUARIUM and OWL CREEK MASTER PLAN project team Lynn turned over the briefing to the Project Planner, Kona Gray - EDSA, a consultant, Museums is working with from Fort Lauderdale, Florida. Mr. Gray introduced his local, National and International team: Bob Kerr -Kerr Environmental, Bill Mackey - Kimley Horn and Billy Almond- land planner and landscape architect. This team is really led by the City of Virginia Beach and the Virginia Aquarium. ConsultEcon is a group of economics in Cambridge, Massachusetts and will assist in the method to make this plan occur. Cambridge Seven Associates are fantastic architects and were responsible for the Restless Planet Exhibit. Menditto + mann is led by Rose Mann, whom are specialists at raining money. Ms. Mann raised over $20-MILLION for the University of Miami. This is a Master Plan Study. What is this master plan study? it is not... it is... - about taking land rights. - a study looking at a district but rather an area. - about redistricting or rezoning the area. - just about the aquarium. - about changing the name of any Community in the area. / a 10 month multi-step master plan process. / about including stakeholders and residents in the process. / about the heritage and culture of the area. / about including the communities in the watershed of Owls Creek. / intended to envision enhancements and preservation for the area. / a guide for implementation of future opportunities. / about gathering your goals and objectives for the next 25 years. June 7, 2011 -12- CITY COUNCIL `S BRIEFING AQUARIUM and OWL CREEK MASTER PLAN Purpose of the study The purpose of the study is to compose a community and tourism based Master Plan providing all relevant information necessary to create an unique destination integrating land use and transit. The conceived Master Plan is intended to encourage development or redevelopment of regional significance by preserving existing community, facilitating a mix of land uses, encouraging transportation connectivity, enhancing the character, providing incentives for quality development and giving definition to the Aquarium & Owls Creek Area. consensus building Establish Vision Team Building Goals and Objectives Feasibility Community Stakeholders City of Virginia Beach Virginia Aquarium June 7, 2011 -13- CITY COUNCIL `S BRIEFING AQUARIUM and OWL CREEK MASTER PLAN placemaking & branding ^ Differentiation • Sustainability • Environmental • Cultural /Social • Economic ^ Improving Location ^ Maturity of Markets ^ Visionary Development project site Aquarium ~ C)vrls Creek area Project Site : +/- 1,200 acres Land Uses: Aquarium, Entertainment, Residential, Navy, Commercial, Light Industrial, Parks, Fisherman's Wharf, Marshes ~ ;. ~,~ NORiOIK AVE "" , -W bi. ' . ~ a ,gam iP ~ ~: >q ro ~ ~ Q . ~ 3~~' ~Y~'~ ~ ,. r w ~` Y ~ ,..+, ~,i Z i ~q;- .~ ~ ig ,~. i ~ 11~~ ;. t ~ ~ ~ ~.. ~ ~ ,"~ Ly~~' _~ r~~. 7~ ~ v t r I ~~fi>w June 7, 2011 ~~ ~~ -14- CITY COUNCIL `S BRIEFING AQUARIUM and OWL CREEK MASTER PLAN local heritage hi<;toricul l~ro~ression •Pre-colonial era •Owls creek 8 Rudee Inlet •Warof 1812 •Deadrise Fishing •First Resort Hotel •Tourism & Princess Anne Hotel •Life Saving Station •Surfing in Virginia Beach •Seatack elementary •Ice House Restaurant •Neighborhoods •Military /Naval Bases ~ ~_~ ~ ~"1~ i >A~~ a i ~~y~ll ~~ ~ planning approach • Create a sustainable framework that contributes to the success of the Community. • Place the most importance on collaboration as the key to sustaining the future growth of Virginia Beach. ^ Introduce "smart growth" principles that protect the Community, improve transportation connectivity and enhance the aesthetic character. • The design team will utilize input & expectations from stakeholders & community members to develop the vision of the project. n ~.~_.._ ~ ,,' ~. • ,_ - June 7, 2011 ~" -15- CITY COUNCIL `S BRIEFING AQUARIUM and OWL CREEK MASTER PLAN design process ~~~af~pas~ Just as importanT as what we produce is how we produce it. A Fundamental part of a successful design depends on the information we gather. As site planners, we approach design thinking in three phases: ~_ .cry; the collection of raw data and information AnC,7i'yS5: organizing the data into information that is useful C;esrrr,; creating solutions ihaT adhere to intended goals G7 =public input t~l woannAr it nnuxs I oe~vr~nue vie . . ecrov vie i ~Ner~~i.... i Public Workshop #2 Public Workshop # 1 Public Workshop #3 guiding principles "Capitalize on the essence of the "Creek" by preserving its future through conservation, progressive planning, education, and environmental stewardship that enhances the local communities serving as a legacy for future generations." Preserve and ensure the security ,tranquility ,character and sanctity of the communities within the area. F'romofe the social, environmental educational and historically significant attributes of Owls Creek. ir,tc;grate research, marine conservation and recreation along with the many facets of culture and nature found in the district to create an unparallel location to visit, live, work, learn, and play. ~<7c:i(itcat~; the connections between the Beach and the Creek to provide incentive for quality development and economic return. 1-orrnuicate a concept that enhances the vision for alternative modes of transit including access by land and water. Maximize return on investment for the area and ensure economic, social and environmental sustainability. EnFlarl<~~~ existing facilities through restoration and expansion to create continuous expectation of new improvements. June 7, 2011 -16- CITY COUNCIL `S BRIEFING AQUARIUM and OWL CREEK MASTER PLAN Focus Areas: Recreation Research and Technology Education Entertainment Economic Development Opportunities Exhibits Sustainable Development Strategies 1. Site Selection 2. Solar & Wind Orientation 3. Local Materials & Vegetation 4. Rainwater Runoff Reduction S. Transportation Systems 6. Building Operations 7. Solar Thermal & Photovoltaic 8. Gray Water 9. Environmental Education 10. Indoor /Outdoor Spaces Existing Reports Information • Resort Area Strategic Plan • Virginia Beach Outdoors Plan • Bike and Trails Plan • Virginia Beach Comprehensive Plan • AICUZ Program Procedures • Hampton Roads Joint Land Use Study (JLUS) Site Inventory Workshop Diagrams CULTURAL FACTORS • land use/zoning • land ownership • neighborhoods/districts • existing transportation • military influence ENVIRONMENTAL FACTORS • climatic impacts • natural systems • wetlands/watersheds June 7, 2011 -17- CITY COUNCIL `S BRIEFING AQUARIUM and OWL CREEK MASTER PLAN Environmental Inventory /Assessment Natural resources assessment ~ Topography ~ Watersheds ~ Soil Suitability ~ Wetlands ~ FEMA Floodplains Flora & Fauna Mammals ~ Reptiles • Raptors ~ Waterbirds • Fish • Invertebrates ~ Insects ~ Trees ~ Shrubs ~ Grasses ~ Vines • Wildflowers Infrastructure inventory /assessment Utility assessment plan Water distribution • ~ Sanitary Roadway inventory General Booth Boulevard • ~ Pacific Avenue Atlantic Avenue • Birdneck Road • Norfolk Avenue • Virginia Beach Boulevard (Route 58) June 7, 2011 -17- CITY COUNCIL `S BRIEFING AQUARIUM and OWL CREEK MASTER PLAN Kona Gray advised the study area is pretty straight forward. It is the watershed for Owls Creek and a dynamic place, comprised of 1,200 acres. Another important factor is the Navy is a very important partner for the City. The Navy has preserved this jewel, with development restrictions, obviously, but remaining is a wonderful urban park right in the middle of Virginia Beach. The Resort Area Strategic Plan was major, because it ties the beach to the area right there at Fisherman's Wharf. This is an incredible connection. The CITY COUNCIL WORKSHOP RE AQUARIUM and OWL CREEK MASTER PLAN ADJOURNED AT 5:41 P.M. June 7, 2011