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<br />~~ <br /> <br />REQUEST FOR CITY COUNCIL AGENDA ITEM <br />Agenda Date Requested March 19 2001 <br />Requested By: <br />Department: A~**+~^~~trative 5ervice~ <br />Report: Resolution: Ordinance: <br />Exhibits: Bid Tab <br />Exhibits: Letter from Consultant <br />Exhibits: Vendor .ist <br />Ayprooriation <br />Source of Funds: Medical Fund <br />Account Number: 014 6144 515 6012 <br />Amount Budgeted: X120,000 <br />Amount Requested: $$73,a5ct <br />Budgeted Item: YES NO <br />SUMMARY & RECOMMENDATION <br />The City's stop loss insurance is due to renew on April 1~. This insurance covers payment of all claims <br />for any one employee or dependent whose medical charges exceed $100,000. The current policy also <br />includes an aggregate amount for all employees and dependents of approximately $1.87 million. This <br />means that if all Gaims exceed $1.87 million, the insurance carrier would ,pay 100% of all claims over that <br />amount. <br />Our current carrier is Houston Casualty Corporation (HCC), with an annual premium of $107,319. HCC <br />was the only company to bid on the new contract. Their bid for specific stop loss was $146,907 and <br />aggregate stop loss is $24,515, for a total of $171,422. They also raised the attachment point from $1.87 <br />• million to $2.55 million, meaning the claims would have to exceed that amount before they pay 100%. <br />The City's catastrophic loss rate has been nearly non-existent. Although there are several employees or <br />dependents who may have catastrophic claims, none have reached the $100,000. <br />The City could save $24,515 this year by omitting the aggregate stop loss coverage. In all the years <br />since becoming self insured, Gaims have never exceeded the attachment point. Even with the premium, <br />the City would be responsible for an additional $678,093 before this coverage became effective. <br />Staff recommends opting for specific stop loss only this year, at an annual cost of $146,907. <br />Action Required by Council: Authorize approval of bid by HCC Benefits, to provide specific stop loss <br />insurance coverage at an annual cost of $146,907. <br />Aaproved for City Council Agenda <br />' ~~/ her <br />Robert T. He era, City Manager <br />-~ l G I <br />Date <br />