Title
Consider and take action on a resolution approving the employee stop-loss insurance with Blue Cross Blue Shield (BCBS) for the period October 1, 2019 to September 30, 2020 and approving the final plan design changes for the City’s benefit options as a result of the movement to Blue Cross Blue Shield as the City’s medical Third Party Administrator (Director of Human Resources and Civil Service)
Background:
Approval of this item will adopt stop loss insurance and authorize the City Manager to execute all contracts related to this program. In addition, final plan design changes for the City’s medical benefit options will also be approved.
On June 25, 2019, City Council approved the selection of BCBS as the City’s medical Third Party Administrator, and RxBenefits/ESI as the stand-alone pharmacy benefit manager, for the period of October 1, 2019 to September 30, 2020. At that time, costs that were presented did not include stop-loss reinsurance as it was still in the Request for Proposal (RFP) process. Additionally, for Stop-Loss insurance, providers require claims data that is at least within 90 days. The city needed the stop-loss data to finalize the plan design changes for our employees’ medical plan.
The Stop-Loss RFP was released on Monday, May 27, 2019 and closed on Tuesday, July 2, 2019. June final claims data was not available until mid-July with best and final offers submitted and received by July 26, 2019.
Stop-Loss Insurance
Responses were received from four vendors. Two finalists were identified following a request for best and final offers (BAFO): BCBS, and Stealth/American Fidelity. HUB conducted a financial analysis comparing the current rates with Cigna (Incumbent). Cigna only provides stop-loss reinsurance to their own customers and therefore was no part of the RFP.
Following the receipt of June claims, BCBS best and final offer came in at $0.00 to the projected added cost of lasers (compared to Cigna’s current $375,00...
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