O-2004-2779 - Laserfiche WebLink

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e e REQUEST FOR CITY COUNCIL AGENDA ITEM Agenda Date Requested: 09-27-04 Appropriation Requested By: Sherri Samp~nn Source of Funds: Medical Fund Department: BURlaR Resourc:es Account Number: 014-6144-515-6061 Report: Resolution: Ordinance: x Amount Budgeted: $3,403,235 Exhibits: Ordinance Amount Requested: $3,403,23; Exhibits: Summary of Benefits Budgeted Item: YES NO Exhibits: SUMMARY & RECOMMENDATION The City of La Porte is self-funded for medical benefits for employees, retirees and their dependents To ensure the City was receiving the best rates and service for its employees, a consultant was used in March of this year to formulate a request for proposal and test the market. Additionally, our employees have had numerous customer service related problems with TML. The RFP requested services for health plan claims administration, utilization review and large case management, preferred provider network, disease management, pharmacy benefit management, COBRA and HIP AA administration. 18 Responses were received for some or all components of the RFP. After an initial evaluation by the Benefit Consultant, two companies were chosen for presentations to the Chapter 172 Board members, Aetna and Humana. Each company was asked to provide information regarding health plan claim administration, utilization review and large case management, preferred provider network, disease management, pharmacy benefit management, HIP AA and COBRA administration. Both companies had current clients and past clients that were willing to supply favorable references. Aetna and Humana both offered substantial savings on the network discounts, compared to TML and their average 30% discount. Aetna claimed to have discounts averaging over 50% and Humana claimed to have discounts averaging at 49%. Human offered new plan designs that are experiencing less than average annual increases to their health benefit costs. The Humana Plan designs also offered similar PPOs to the City's current plan design. The Chapter 172 Board of Trustees is recommending that Council authorize the City Manager to negotiate a 3 year contract with Humana, beginning January 01,2005, for Administrative Services of the City's medical plan. This proposal includes adopting the 4 plan design options Humana recommends for the City of La Porte (Coverage First 1500, Coverage First 1000, PPO 500 and PPO 300). Action Required bv Council: Authorize City Manager to award bid to Humana, to administer the City's Medical Plan and adopt 4 plan designs proposed by Humana. ~{uJ4nff&- ebra FeazeUe, Manager q-~:l-oif Date