ACTION REQUESTED:
Title
Communication from the City Manager and Director of Human Resources with a Request to APPROVE and AUTHORIZE The City Manager to Enter into a One-Year CONTRACT with HCC LIFE INSURANCE COMPANY for STOP LOSS INSURANCE SERVICES for the City’s Health Care Plan to be Effective January 1, 2020, through December 31, 2020.
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BACKGROUND: Each year, the City’s Labor/Management Health Care Committee enters into an annual agreement for stop loss insurance for the City’s Health Care Plan. Stop loss insurance pays claims for the Health Care Plan over the specific amount of $225,000.00. The City’s Health Care Consultant, Cottingham & Butler, per the Health Care Committee’s authorization, served as the City’s broker to obtain bids from carriers. Stop Loss Vendors submitted their cost proposals and they were reviewed by the City’s consultant and the Health Care Committee. The City’s consultant and the Health Care Committee recommend HCC Life Insurance Company based on the rates and the ability to provide the required services for the City. The increase in cost is the result of two medical claims of over $1 million dollars each.
FINANCIAL IMPACT: With the approval of this contract, the City will have stop loss insurance in place to receive reimbursement for any claims over $225,000.00 and help reduce overall health care costs for 2020. The proposed cost of $683,423.88 annually is less than what was budgeted for 2020.
NEIGHBORHOOD CONCERNS: NA
IMPACT IF APPROVED: The City will have stop loss insurance in place to cover any high dollar claims in excess of $225,000.00 for medical and prescription claims.
IMPACT IF DENIED: The City would have to pay all high dollar claims under the Health Care budget.
ALTERNATIVES: None.
EEO CERTIFICATION NUMBER: 03478-190630
WHICH OF THE GOALS IDENTIFIED IN THE COUNCIL’S 2017 - 2032 STRATEGIC PLAN DOES THIS RECOMMENDATION ADVANCE?
1. Financially Sound City
WHICH CRITICAL SUCCESS FACTOR(S) FROM THE COMPREHENSIVE PLAN DOES THIS RECOMMENDATION IMPLEMENT?
1. Have an efficient government.
DEPARTMENT: Human Resources