A message from the Mayor

Dear employees and retirees:

Every day we read and hear about rising health-care costs, and employers facing the difficult decision of whether to continue offering health benefits to their employees and retirees. Preserving the City’s benefits plans in these tough financial times is very important to me, and I believe that by working together, we have been successful. Often times, changes must be made to our plans to help keep them affordable, but I am happy to say that for the second year, no changes to the benefits plans will occur for May 2008. This is because you continue to use your health care dollars wisely and efficiently by making cost-conscientious choices – using generic and mail-order prescription drugs, using urgent care centers instead of emergency rooms, getting annual physical exams, exercising, engaging healthy lifestyles, and eating nutritious foods.

However, the rising costs of health-care services have created an increase in the city’s medical plan costs from $248 million in FY08 to $276 million in FY09. State-of-the-art medical procedures, equipment, and specialty drugs do much to improve our quality of life, but are very costly. To keep on track with this large expense, sustain the plan’s current benefit levels, and maintain the current contribution ratio of 74 percent for the city and 26 percent for the participant, the city will share the cost increase with you. At the same time, your dental and supplemental insurance rates are locked in until April 2009, so you will not experience any cost increases or changes to these benefits. The maximum contribution to the Healthcare Flexible Spending Account will increase to $2,000 from $1,000.

Specific information about your benefits and the new rates are provided in this guide. If you have questions, please see your HR Liaison or attend an open enrollment meeting. You can obtain a meeting schedule online at www.houstonhumanresources.org.

If we continue to work together, we should be able to retain quality, accessible and affordable health-care benefits. Thank you for appreciating your valuable benefits and for continuing to use them effectively.

Respectfully,

Mayor