City Council Special Meeting

AGENDA City Council Special Meeting Budget Workshop Tuesday, July 14, 2026 4:00 PM City Hall 4000 Galleria Parkway, Bee Cave, Texas 78738-3104 The City of Bee Cave council meetings are available to all persons regardless of disability. If you require special assistance, please contact City Secretary Office at (512) 767-6641 or jtouchstone@beecavetexas.gov and/or rregueira@beecavetexas.gov at least 48 hours in advance of the meeting. Thank you. 1. Call meeting to order. 2. Roll Call. 3. Pledge of Allegiance. 4. Discuss Preliminary Fiscal Year 2027 budget.  Staff report – Julie Oakley, City Manager.  Public comment. 5. Discuss and consider action on renewing the contract with Texas Health Benefits Pool 3 for employee health insurance and other benefits for fiscal year 2026-2027.  Staff report – Brooke Winburn, Director of Human Resources.  Public comment. Staff Report Presentation 6. Adjournment. Decorum Required: Any disruptive behavior, including shouting or derogatory statements or comments may be ruled out of order by the Presiding Officer. Continuation of this type of behavior could result in a request by the Presiding Officer that the individual leave the meeting, and if refused, an order of removal. Action by Council Authorized: The City Council may vote and/or act upon any item within this Agenda. The Council reserves the right to retire into executive session concerning any of the items listed on this Agenda, pursuant to and in accordance with Texas Government Code § 551.072 (Deliberations about Real Property); § 551.073 (Deliberations about Gifts & Donations); § 551.076 (Deliberations about Security Devices); §551.087 (Economic Development); §551.074 (Personnel Matters) and, § 551.071 to seek the advice of its attorney about pending or contemplated litigation, settlement offer or on a matter in which the duty of the attorney to the Page 1 of 18 governmental body under the Texas Disciplinary Rules of Professional Conduct of the State Bar of Texas conflict with the Open Meetings Act and may invoke this right where the City Attorney, the Mayor or a majority of the Governing Body deems an executive session is necessary to allow privileged consultation between the City Attorney and the governing body, if considered necessary and legally justified under the Open Meetings Act. The attorney may appear in person or appear in executive session by conference call in accordance with applicable state law. Executive Sessions Reviewed by City Attorney: This agenda has been reviewed and approved by the City’s legal counsel and the presence of any subject in any Executive Session portion of the agenda constitutes a written interpretation of Texas Government Code Chapter 551 by legal counsel for the body and constitutes an opinion by the attorney that the items discussed therein may be legally discussed in the closed portion of the meeting considering available opinions of a court of record and opinions of the Texas Attorney General known to the attorney. This provision has been added to this agenda with the intent to meet all elements necessary to satisfy Texas Government Code Chapter 551.144(c) and the meeting is conducted by all participants in reliance on this opinion. Attendance By Other Elected or Appointed Officials: It is anticipated that members of other city boards, commissions and committees may attend the meeting in numbers that may constitute a quorum of such other city boards, commissions and committees, so that notice is hereby given that the meeting is also a meeting of the other city boards, commissions and committees whose members are in attendance. The members of the other city boards, commissions and committees may participate in discussions which occur at the meeting, but no action will be taken by the other boards, commissions, and committees whose members are in attendance. Approved this 8th day of July, 2026. _____________________________________ Kara King, Mayor Certificate I certify that the above notice of meeting was posted at Bee Cave City Hall, 4000 Galleria Parkway, Bee Cave, Texas, on the 8th day of July, 2026 at 6:00 P.M. and will remain posted continuously until the meeting is convened. (Seal) _____________________________________ Jo Ann Touchstone, City Secretary Page 2 of 18  Staff Report Meeting Date: July 14, 2026 Staff Contact/Department: Brooke Winburn/Administration Background: Since 2008, the City of Bee Cave has partnered with TX Health Benefits (TXHB) through an annually renewed inter-local agreement for comprehensive medical and dental insurance. For FY26, medical premiums were projected to increase by 9% for the same plan. However, the city increased deductibles and out-of-pocket costs to offset the hike, ultimately resulting in a 1.33% decrease in premium amounts. For FY27, the City's current medical plan with TXHB received a 20% increase. Staff has reviewed alternative options and is recommending retaining our current provider. This decision necessitates a change in the plan's structure for a second year in a row, including an increase in the deductible and out-of-pocket maximums, which will result in a 13.26% increase in current premiums. FY25 FY26 FY27 Deductible $500 $750 $1,000 Out of Pocket $2,000 $3,000 $4,000 Watkins Insurance conducted a comprehensive market analysis to evaluate alternative plans. Several providers declined to submit proposals, while the remaining submissions were either the same or not financially competitive. Fiscal Impact: Assuming all employees maintain their existing coverage selections, the total projected cost for health insurance is anticipated to increase by approximately $112,204 over the current fiscal year. Timeline Considerations: The re-rate from Texas Health Benefits Pool was due June 30, 2026. Renewal of the agreement would become effective October 1, 2026 and expire on September 30, 2026, if approved. Enclosure(s): Annual Percentage Increase/Decrease Chart, Comparative City Plans, and Market Comparison. Page 3 of 18  Annual Percentage Increase/Decrease 20.00% 18.00% 15.00% 15.00% 13.26% 10.00% 10.00% 7.00% 6.99% 6.00% 5.00% 2.00% 0.00% 0.00% 0.00% FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 FY26 FY27 Average -1.33% -5.00% Comparables The next two charts show the deductible and out-of-pocket for individual coverage and family coverage. Not all cities have received their renewal for FY 2026-27. The following cities have: Boerne – 8.8% Georgetown – 0% Lakeway – 12% Marble Falls – 5% The chart shows that Pflugerville has a high deductible of $4,000, however, they have a Health Reimbursement Arrangement (HRA). The city reimburses up to $2,500 making the employee’s actual deductible $1,500. Georgetown utilizes a direct premium credit incentive ($300 annually) to drive employees to preventative primary care visits, which has helped them control over plan utilization. Boerne has a $0 copay plan, so the employee pays 100% of medical treatment until they reach their deductible. At that point, the plan covers 80%. The city provides a $300 HRA account. Page 4 of 18 Page 5 of 18 October 1, 2026 Page 6 of 18 TABLE OF Executive Overview Claims Analysis CONTENTS Medical Page 7 of 18 Executive Overview Page 8 of 18 RENEWAL OVERVIEW Texas Health Benefits Pool Medical Claims • Current 12 month loss ratio, 95%. • Previous 12 month loss ratio, 135%. • There were 2 high cost members for a total of $268K. Medical Renewal Overview • TXHB Renewal rates on current plan increased 20%. • Alternate plan option presented at 13.26% increase. • Option presented from United Healthcare and premiums very close to TXHB. Page 9 of 18 MARKETING REVIEW LIST Medical Carriers Requested Status Comments Aetna Medical Quoted Uncompetitive Angle Health Medical Declined Uncompetitive Curative Medical Quoted Uncompetitive Blue Cross Blue Shield of TX - Medical Quoted Uncompetitive Fully-insured Cigna - Level-funded Medical Declined Uncompetitive Nationwide Medical Declined Unable to write non-ERISA groups SANA Benefits Medical Declined Unable to write non-ERISA groups Trustmark Medical Declined Uncompetitive United Healthcare - Fully- Medical Quoted Option Presented – could also offer the high insured deductible plan as a dual option Page 10 of 18 Claims Analysis Page 11 of 18 Page 12 of 18 Page 13 of 18 Page 14 of 18 Page 15 of 18 Medical Page 16 of 18  City of Bee Cave Plan Group Comparison - 10/1/26 - 9/30/27 This is a brief, illustrative summary of the benefits and rates. This is not intended to be a complete comparison of contract Report as of 9 July 2026 provisions. Refer to the contract/certificate for exact benefit details. While every effort has been made to ensure the accuracy of the rates, final rates are subject to change and are based on final enrollment and underwriting approval. * = Additional details available Current Renewal Proposed Medical Plan Group TX Health Benefits Pool TX Health Benefits Pool TX Health Benefits Pool $ 858,58188 $ 1,030,30242 +20.0% $ 972,42552 +13.3% Blue Cross and Blue Shield of Texas Blue Cross and Blue Shield of Texas Blue Cross and Blue Shield of Texas Medical Plan Design Copay-750-3K ER Copay-750-3K ER Opt 7 $1,000-4K ER Single Family Single Family Single Family Deductible $ 750 $ 1,500 $ 750 $ 1,500 $ 1,000 $ 2,000 Embedded Embedded Embedded Embedded Embedded Embedded Employee Coinsurance 20 % 20 % 20 % 20 % 20 % 20 % Out-of-Pocket Max $ 3,000 $ 6,000 $ 3,000 $ 6,000 $ 4,000 $ 8,000 Employer Funding $ - 0 $ - 0 $ - 0 $ - 0 $ - 0 $ - 0 Net Out-of-Pocket Max $ 3,000 $ 6,000 $ 3,000 $ 6,000 $ 4,000 $ 8,000 Employee Annual Premium $ + 0 $ + 4,612 $ + 0 $ + 5,534 $ + 0 $ + 5,223 Employee Max Annual Cost $ 3,000 $ 10,612 $ 3,000 $ ▲11,534 $ ▲4,000 $ ▲13,223 Medical Copays Copay Copay Copay Primary Care $ 30 $ 30 $ 30 Specialty Care $ 60 $ 60 $ 60 Urgent Care $ 75 $ 75 $ 75 Emergency $ 500 + Ded + 20% coinsurance $ 500 + Ded + 20% coinsurance $ 500 + Ded + 20% coinsurance In-Patient Hospital $ -- Ded + 20% coinsurance $ -- Ded + 20% coinsurance $ -- Ded + 20% coinsurance Out-Patient Hospital $ -- Ded + 20% coinsurance $ -- Ded + 20% coinsurance $ -- Ded + 20% coinsurance Rx No Deductible No Deductible No Deductible Tiers $10, $45, $90, $150, $175 $10, $45, $90, $150, $175 $10, $45, $90, $150, $175 Enrollment 56 Prem ER EE 56 Prem ER EE 56 Prem ER EE Employee Only 21 $ 78838 100 % $ 000 21 $ 94606 100 % $ 000 21 $ 89292 100 % $ 000 Employee + Spouse 7 $ 1,60038 87 % $ 20300 7 $ 1,92046 87 % $ 24360 7 $ 1,81258 87 % $ 22992 Employee + Children 13 $ 1,38754 89 % $ 14979 13 $ 1,66506 89 % $ 17975 13 $ 1,57152 89 % $ 16965 Family 15 $ 2,32566 83 % $ 38432 15 $ 2,79080 83 % $ 46118 15 $ 2,63402 83 % $ 43528 Annual Insurance Premium $ 968,17872 $ 1,161,81912 ▲ +20.0% $ 1,096,55328 ▲ +13.3% Employer Premium Contribution $ 858,58188 $ 1,030,30242 $ 972,42552 Budgeted HRA + HSA $ + 000 + 000 $ + 000 + 000 $ + 000 + 000 Employer Annual Cost $ 858,581.88 $ 1,030,302.42 +20.0% $ 972,425.52 +13.3% Page 17 of 18  HE A DQ UA RT E RS THANK YOU! 3834 Spicewood Springs Rd, Ste. 100 Austin TX 78759 (512) 452-8877 | (800) 460-5932 www.WatkinsInsuranceGroup.com Watkins Insurance Group offers a full range of insurance programs: Personal Insurance | Commercial Insurance | Employee Benefits | Individual Life & Long-Term Care Page 18 of 18