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Item 4.b.
CENTRAL SAN
September 24, 2019
TO: FINANCE COMMITTEE
FROM: TEJI O'MALLEY HUMAN RESOURCES MANAGER
REVIEWED BY: ANN SASAKI, DEPUTY GENERAL MANAGER
ROGER S. BAILEY, GENERAL MANAGER
SUBJECT: RECEIVE UPDATE ON PROCESSING OF MEDICARE REIMBURSEMENTS
Pursuant to Central San's Memoranda of Understanding (MOUs), some retirees receive a reimbursement
of their Medicare premiums. Currently, a retiree submits proof of payment to the District and, once a
quarter, Accounts Payable processes the reimbursement and issues it directly to the retiree.
As this is a very manual and time consuming process, members of the Finance Committee asked staff if
there was a more efficient way to handle this process.
Human Resources currently has a contract with P&A Group (P&A)to administer the Section 125 Cafeteria
Plan (Health Spending Account, Dependent Care, and Commuter Benefit Program) reimbursements. As
P&A is familiar with District processes and has the capability to provide this service, staff asked for P&A to
provide a quote for the service.
P&A would be able to provide this service for approximately$3,000 a year which would reflect a significant
cost savings related to the staff time currently spent processing these reimbursements. The estimate for
staff time is $11,300. Additionally, P&A can provide services that the District cannot currently provide,
such as direct deposit of reimbursements, online submission, claims tracking, and an average three-day
turnaround time which would provide better customer service to our retirees. Central San has contracted
with P&A to process this service beginning in January 2020.
Staff will be at the meeting to answer any questions or provide additional information.
Strategic Plan Tie-In
GOAL THREE: Be a Fiscally Sound and Effective Water Sector Utility
Strategy 2- Manage costs
September 24, 2019 Regular FINANCE Committee Meeting Agenda Packet- Page 101 of 128