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Home My WebLink About _ 9.15(a)--Budget Amendment for GLP-1s GI �" Y C� F � � �- ' � ° � � i � CITY OF REDDING �� REPORT TO THE CITY COUNCIL MEETING DATE: December 2, 2025 FROM: Kari Kibler,Personnel ITEM NO. 9.15(a) Director ***APPROVED BY*** � � . , � � ��ler,Persannel T)ie��tr�r l l(?4/242� t�F�a a �, i�t � l ll?6/202;� kkibler@cityofredding.org sbade@cityofredding.org SUBJECT: 9.15(a)--Consider budget Resolution increasing appropriations for City of Reddin em loyee benefits insurance. Recommendation Authorize and approve the following: (1) Adopt Resolution approving and adopting the 18th Amendment to City Budget Resol�ution No. 2025-049 increasing appropriations by $36,000 in Fiscal Year 2025-26 and $72,000 in Fiscal Year 2026-27 due to benefit plan changes related to Glucagon-like peptide-1 (GLP-1) copayments which violate the Memoranda of Understanding with the City of Redding's (City)bargaining units; and (2) A�uthorize City staff to reimburse beneficiaries the difference paid by the City's Health Insurance plan and the copayment amount outlined in the corresponding Memoranda of Understanding for medically necessary GLP-1 medications. Fiscal Impact The Personnel Department is requesting a budget resol�ution to utilize cash reserves from the Group Insurance Fund to pay for potential expenses related to Glucagon-like peptide-1 (GLP-1) expenses. As proposed, adopting the resolution would increase appropriations for health insurance expenses by $36,000 in FY 25-26 and $72,000 in FY 26-27 to cover the reimbursement of copayments in excess of the bargained amount for beneficiaries. Currently, staff is estimating that approximately 115 beneficiaries use a GLP-1 for a reason other than diabetes management. The increase in appropriations estimates that approximately half of these will qualify for reimbursement ($150 maximum coinsurance - $50 original copayment = $100 monthly reimbursement x 60 beneficiaries = $6000/monthly). If these costs are sti11 occurring during the next budget development process they will be allocated to the respective departments based on utilization. There is no direct General Fund impact. Report to Redding City Council November26,2025 Re: 9.15(a)--Bua'getAmendment for GLP-1s Page 2 Alternative Action The City Council (Council) could decline to take the recommended actions; this is not recommended as the City of Redding (City) is bound by the provisions in the various Memoranda of Understanding. Imposition of bene�t changes may result in Unfair Practice Charges being filed by various bargaining units with the Public Employment Relations Board. Background/Analysis Public Risk Innovation, Solutions, and Management (PRISM) (formerly California State Association of Counties — Excess Insurance Authority CSAC-EIA) is one o� the largest Joint Powers Authorities (JPAs) in California. The City has participated in the PRISMHealth program since 2007, which pools claims risk and costs in order to prolnote cost control and consistency relative to health care costs. PRISMHealth operates under a governance model in which strategic decisions are made by the PRISMHealth Committee for the entire pool. Effective January 1, 2026, the PRISMHealth Committee implemented copayment changes specific to GLP-1 medications: • Beneficiaries taking a GLP-1 for diabetes management will continue to pay a $50 copayment for GLP-1 medications. (This is no change to the current coverage.) • Beneficiaries taking a GLP-1 for weight loss will only be eligible for coverage if the following conditions exist: ■ The beneficiary has a body mass index (BMI) of 40 or higher; or ■ The beneficiary has a BMI between 35 and 39 with at least one related comorbidity. o Those persons will pay a 30% coinsurance up to a maximum of$150. • If a bene�iciary does not meet the conditions above, the GLP-1 medication is not considered medically necessary and not covered by the City's insurance. The Memoranda of Understanding with the City's bargaining units specify that specialty medications will be subject to a copayment of$50. The Meyers Milias Brown Act (MMBA) reguires local government agencies in California to meet and confer in good faith with representatives of recognized employee organizations (e.g. labor unions) over changes to "wages, hours and terms and conditions of employment." As the City is in locked contracts with the different bargaining units, the City is unable to negotiat� the benefit change (inereased copayment specific to GLP-ls) until the eontracts expire and the City re-opens negotiations with each bargaining unit. As this change cannot be unilaterally imposed without violating the M:MBA, staff recommends that the Council authorize staff to reimburse beneficiaries the difference between the copayment amount paid by insurance and the amount listed in the appropriate 1Vlemorandum of Understanding �or medically necessary GLP-1 medieations until such time as the contract language can be renegotiated with each bargaining unit. Report to Redding City Council November26,2025 Re: 9.15(a)--Bua'getAmendment for GLP-1s Page 3 Envi�onmental Review This is not a project defined under the California Environmental Quality Act, and no further action is required. Council Priority/City Manager Goals � Government of the 215t Century — `Be relevant and proactive to the opportunities and challenges of today's residents and workforce. Anticipate the future to make better decisions today." Attachments ^Budget Resolution Resolution No. 2025 - A RESOLUTION OF THE CITY OF REDDING APPROVING AND ADOPTiNG THE 18th AMENDMENT TO CITY BUDGET RESOLUTION NO. 2025-049 APPROPRIATING FOR FISCAL YEAR 2026 $36,000 AND FISCAL YEAR 2027 $72,000 FOR GLUCAGON-LIKE PEPTIDE-1 (GLP-1) COPAYMENTS. BE IT RESOL VED BY THE CITY COUNCIL OF THE CITY OF REDDING THAT Budget Resolution No. 2025-049 be and is hereby amended as follows: Fiscal Year Ended 2026 FUND DNISION DESCRIPTION INCREASE DECREASE 399 3999 Group Health Claims Expense $36,000 $0 Fiscal Year Ended 2027 FUND DIVISION DESCRIPTION 1NCREASE DECREASE 399 3999 Group Health Claims Expense $72,000 $0 THAT account titles and numbers requiring adjustments by this Resolution are as follows: Fiscal Year Ended 2026 USE SOURCE OF FUNDS OF FUNDS Increase(Decrease)Beginning Balance 399-3999-2910000 Fund Balance 36,000 Increase Expenditures 399-3999-5057501 Group Health Claims Expense $ 36,000 Total $ 36,000 $ 36,000 Fiscal Year Ended 2027 USE SOURCE OF FUNDS OF FUNDS Increase(Decrease)Beginning Balance 399-3999-2910000 Fund Balance 72,000 Increase Expenditures 399-3999-5057501 Group Health Claims Expense $ 72,000 Total $ 72,000 $ 72,000 THAT the purpose is to appropriate for fiscal year 2026 $36,000 and for �sca1 year 2027 $72,000 for glucagon-like peptide-1 (GLP-1) copayments. I HEREBY CERTIFY that the foregoing Resolution was introduced at a regular meeting of the City Council of the City o�Redding on the day of December, 2025 and was duly adopted at said meeting by the following vote: AYES: COUNCIL MEMBERS: NOES: COUNCIL MEMBERS: ABSENT: COUNCIL MEMBERS: ABSTAIN: COUNCIL MEMBERS: JACK MUNNS, Mayor ATTEST: FORM APPROVAL: SHARLENE TIPTON, City Clerk CHRISTIAN M. CURTIS, City Attorney