Finance and Audit Committee
Finance and Audit Committee RFP 17-0058 Review
Kari Jo Zika Director, Human Resources August 8, 2017
Clinic Follow Up Items
2
CareATC “Dedicated” vs. “Shared” Year One Pricing
3
Near-site Proximity to Members Homes
4
Five Year Projections – No Clinic All Subscribers - No Clinic 2016 2536
2017 2539
2018 2539
2019 2564
2020 2590
2021 2616
2017-2021 5-Year Totals 2570
Headcount % Increase
--
0.0%
0.0%
1.0%
1.0%
1.0%
1.2%
Annualized Med Trend
--
8.00%
1.57%
8.00%
8.00%
8.00%
27.95%
Annualized Rx Trend
--
12.00%
7.98%
12.00%
12.00%
12.00%
51.69%
$667.91 $145.69 $813.60
$721.34 $163.17 $884.51
$732.67 $176.18 $908.85
$791.28 $197.32 $988.60
$854.58 $221.00 $1,075.58
$922.95 $247.52 $1,170.47
$805.34 $201.36 $1,006.70
$20,325,837 $4,433,638 $24,759,475
$21,977,787 $4,971,464 $26,949,251
$22,322,990 $5,367,852 $27,690,842
$24,349,806 $6,072,065 $30,421,871
$26,560,694 $6,868,770 $33,429,464
$28,972,518 $7,769,953 $36,742,471
$124,183,795 $31,050,103 $155,233,898
Subscribers
Medical PEPM Rx PEPM Total PEPM Medical Claims Rx Claims Total Claims
5
Five Year Projections - Clinic All Subscribers - Third-Party Clinic 2016 2536
2017 2539
2018 2539
2019 2564
2020 2590
2021 2616
2017-2021 5-Year Totals 2570
Medical Decrement
--
0.00%
5.00%
5.00%
5.00%
5.00%
9.69%
Rx Decrement
--
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
$667.91 $145.69 $813.60
$721.34 $163.17 $884.51
$696.60 $176.18 $872.78
$717.50 $197.32 $914.82
$739.03 $221.00 $960.03
$761.20 $247.52 $1,008.72
$727.27 $201.36 $928.64
$20,325,837 $4,433,638 $24,759,475
$21,977,787 $4,971,464 $26,949,251
$21,224,009 $5,367,852 $26,591,861
$22,079,398 $6,072,065 $28,151,463
$22,969,353 $6,868,770 $29,838,123
$23,894,990 $7,769,953 $31,664,942
$112,145,537 $31,050,103 $143,195,640
$0
$0
-$1,098,981
-$2,270,408
-$3,591,341
-$5,077,528
-$12,038,258
$0 $24,759,475
$294,880 $27,244,131
$921,360 $27,513,221
$921,360 $29,072,823
$921,360 $30,759,483
$921,360 $32,586,302
$3,980,320 $147,175,960
$0
$294,880
-$177,621
-$1,349,048
-$2,669,981
-$4,156,168
-$8,057,938
Subscribers
Medical PEPM Rx PEPM Total PEPM Medical Claims Rx Claims Total Claims Claim Savings Clinic Cost* Net Cost Net Increase/(Savings)
* 2017 Clinic Cost represents 3 months of ongoing costs (i.e. effective 10/1/2017) + $64,540 start up costs. No build out costs.
6
RFP 17-0058 TPA for Employee Health and Insurance Services Overview and Recommendations
RFP Timeline – All Plans
- Clinic & Benefit RFPs
8
Evaluation Metrics and Team Qualifications and Experience
RFP Format and Content
Value/Cost
40%
30%
15%
References
Innovation
10%
5%
Non-Scoring Evaluation Committee Members: Kari Zika, Director, Human Resources Janice Hughes, Sr. Purchasing Agent
Scoring Evaluation Committee Members: Heather Moorhead, HR Manager – Lisa Zepeda, HR Manager Steve Hendrix, Deputy Fire Chief – Dennis John, IT Director Amber Dembroski, Business Services Manager, Parks – Anne Mott, HR Benefits Specialist Martha Woody, Police Sergeant and Police Association Representative Scott Gibbs and Brant Brinlee, McGriff, Benefits Consultants
9
RFP Responses / Lines of Coverage Vendor UHC Cigna Aetna BCBS Dearborn Navitus Connect Your Care Prudential TASC Minnesota Life/Securian CareWorks The Municipal Pool Discovery Benefits Mutual of Omaha Wageworks Symetra The Standard
Post 65 Medical RX Cobra Medicare H.S.A. X X X X X X X X X X X X X X X X X X
FSA X X X X
EAP X X X X
LTD X X X
STD X X X
Basic Life Vol life/ADD FMLA X X X X X X X X X
X
X
X
X
X
X X
X
X
X
X X
X
X
X X
X
X X
X
X
X
X X X
X X
X
X
X
X
X
X
X
X X
X X
X X
X X
X X X
X X X X
RFP Responses / Evaluation Results Evaluation Selection(s)
Line of Coverage Considered
UHC
Medical, Cobra, Post 65, HSA, FSA
Navitus
RX
Prudential
EAP, LTD, STD, Basic Life, Vol Life/ADD, FMLA
11
Medical/Rx Comparison & Recommendation
*Ancillary Services – Comparison & Recommendation Coverage/ Service
Current
Renewal
Recommendation
Basic Life
CIGNA = $150,718
CIGNA = $150,718
Prudential = $150,718
LTD
CIGNA = $278,389
CIGNA = $278,389
Prudential = $230,445
FSA
UHC = $22,194
UHC = $20,154
UHC = $20,154
HSA
UHC = $0
UHC = $0
UHC = $0
EAP
UHC = $52,154
UHC = $52,154
Prudential = $0
COBRA
UHC = $14,183
UHC = $14,183
UHC = $14,183
FMLA
CIGNA = $46,530
CIGNA = $46,530
Prudential = $39,198
TOTAL
$564,169
$562,129
$454,698
*Employer paid costs only (STD/Vol Life not Listed) (HSA Fee included in Medical ASO Fee)
13
Recommendation •
•
•
UHC Medical •
Eliminate employee disruption
•
Wellness budget increased by $225,000 and can be used for Clinic
•
Opportunity to open Clinic sooner due to less disruption
•
Offer a relatively new narrow network option, can be considered in 2019
Navitus Rx •
Increased pharmacy network
•
Decreased Rx costs
•
Improved plan management
Prudential •
Eliminate EAP cost with savings of over $50,000
•
Decreased costs overall for ancillary benefits
All recommended vendors provided 3 Year Rate Guarantee and enhanced Performance Guarantees
14
2018 Summary •
• • • • •
Benefits and Network Stays the Same Expanded Pharmacy Network Significant pharmacy savings at a time trend is increasing at a higher pace than medical Clinic Integration w/Wellness Program Minimal premium increase for Employees & Retirees Improved service level for FMLA & EAP administration
15
QUESTIONS?
Kari Jo Zika Director, Human Resources August 8, 2017
Clinic Follow Up Items
2
CareATC “Dedicated” vs. “Shared” Year One Pricing
3
Near-site Proximity to Members Homes
4
Five Year Projections – No Clinic All Subscribers - No Clinic 2016 2536
2017 2539
2018 2539
2019 2564
2020 2590
2021 2616
2017-2021 5-Year Totals 2570
Headcount % Increase
--
0.0%
0.0%
1.0%
1.0%
1.0%
1.2%
Annualized Med Trend
--
8.00%
1.57%
8.00%
8.00%
8.00%
27.95%
Annualized Rx Trend
--
12.00%
7.98%
12.00%
12.00%
12.00%
51.69%
$667.91 $145.69 $813.60
$721.34 $163.17 $884.51
$732.67 $176.18 $908.85
$791.28 $197.32 $988.60
$854.58 $221.00 $1,075.58
$922.95 $247.52 $1,170.47
$805.34 $201.36 $1,006.70
$20,325,837 $4,433,638 $24,759,475
$21,977,787 $4,971,464 $26,949,251
$22,322,990 $5,367,852 $27,690,842
$24,349,806 $6,072,065 $30,421,871
$26,560,694 $6,868,770 $33,429,464
$28,972,518 $7,769,953 $36,742,471
$124,183,795 $31,050,103 $155,233,898
Subscribers
Medical PEPM Rx PEPM Total PEPM Medical Claims Rx Claims Total Claims
5
Five Year Projections - Clinic All Subscribers - Third-Party Clinic 2016 2536
2017 2539
2018 2539
2019 2564
2020 2590
2021 2616
2017-2021 5-Year Totals 2570
Medical Decrement
--
0.00%
5.00%
5.00%
5.00%
5.00%
9.69%
Rx Decrement
--
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
$667.91 $145.69 $813.60
$721.34 $163.17 $884.51
$696.60 $176.18 $872.78
$717.50 $197.32 $914.82
$739.03 $221.00 $960.03
$761.20 $247.52 $1,008.72
$727.27 $201.36 $928.64
$20,325,837 $4,433,638 $24,759,475
$21,977,787 $4,971,464 $26,949,251
$21,224,009 $5,367,852 $26,591,861
$22,079,398 $6,072,065 $28,151,463
$22,969,353 $6,868,770 $29,838,123
$23,894,990 $7,769,953 $31,664,942
$112,145,537 $31,050,103 $143,195,640
$0
$0
-$1,098,981
-$2,270,408
-$3,591,341
-$5,077,528
-$12,038,258
$0 $24,759,475
$294,880 $27,244,131
$921,360 $27,513,221
$921,360 $29,072,823
$921,360 $30,759,483
$921,360 $32,586,302
$3,980,320 $147,175,960
$0
$294,880
-$177,621
-$1,349,048
-$2,669,981
-$4,156,168
-$8,057,938
Subscribers
Medical PEPM Rx PEPM Total PEPM Medical Claims Rx Claims Total Claims Claim Savings Clinic Cost* Net Cost Net Increase/(Savings)
* 2017 Clinic Cost represents 3 months of ongoing costs (i.e. effective 10/1/2017) + $64,540 start up costs. No build out costs.
6
RFP 17-0058 TPA for Employee Health and Insurance Services Overview and Recommendations
RFP Timeline – All Plans
- Clinic & Benefit RFPs
8
Evaluation Metrics and Team Qualifications and Experience
RFP Format and Content
Value/Cost
40%
30%
15%
References
Innovation
10%
5%
Non-Scoring Evaluation Committee Members: Kari Zika, Director, Human Resources Janice Hughes, Sr. Purchasing Agent
Scoring Evaluation Committee Members: Heather Moorhead, HR Manager – Lisa Zepeda, HR Manager Steve Hendrix, Deputy Fire Chief – Dennis John, IT Director Amber Dembroski, Business Services Manager, Parks – Anne Mott, HR Benefits Specialist Martha Woody, Police Sergeant and Police Association Representative Scott Gibbs and Brant Brinlee, McGriff, Benefits Consultants
9
RFP Responses / Lines of Coverage Vendor UHC Cigna Aetna BCBS Dearborn Navitus Connect Your Care Prudential TASC Minnesota Life/Securian CareWorks The Municipal Pool Discovery Benefits Mutual of Omaha Wageworks Symetra The Standard
Post 65 Medical RX Cobra Medicare H.S.A. X X X X X X X X X X X X X X X X X X
FSA X X X X
EAP X X X X
LTD X X X
STD X X X
Basic Life Vol life/ADD FMLA X X X X X X X X X
X
X
X
X
X
X X
X
X
X
X X
X
X
X X
X
X X
X
X
X
X X X
X X
X
X
X
X
X
X
X
X X
X X
X X
X X
X X X
X X X X
RFP Responses / Evaluation Results Evaluation Selection(s)
Line of Coverage Considered
UHC
Medical, Cobra, Post 65, HSA, FSA
Navitus
RX
Prudential
EAP, LTD, STD, Basic Life, Vol Life/ADD, FMLA
11
Medical/Rx Comparison & Recommendation
*Ancillary Services – Comparison & Recommendation Coverage/ Service
Current
Renewal
Recommendation
Basic Life
CIGNA = $150,718
CIGNA = $150,718
Prudential = $150,718
LTD
CIGNA = $278,389
CIGNA = $278,389
Prudential = $230,445
FSA
UHC = $22,194
UHC = $20,154
UHC = $20,154
HSA
UHC = $0
UHC = $0
UHC = $0
EAP
UHC = $52,154
UHC = $52,154
Prudential = $0
COBRA
UHC = $14,183
UHC = $14,183
UHC = $14,183
FMLA
CIGNA = $46,530
CIGNA = $46,530
Prudential = $39,198
TOTAL
$564,169
$562,129
$454,698
*Employer paid costs only (STD/Vol Life not Listed) (HSA Fee included in Medical ASO Fee)
13
Recommendation •
•
•
UHC Medical •
Eliminate employee disruption
•
Wellness budget increased by $225,000 and can be used for Clinic
•
Opportunity to open Clinic sooner due to less disruption
•
Offer a relatively new narrow network option, can be considered in 2019
Navitus Rx •
Increased pharmacy network
•
Decreased Rx costs
•
Improved plan management
Prudential •
Eliminate EAP cost with savings of over $50,000
•
Decreased costs overall for ancillary benefits
All recommended vendors provided 3 Year Rate Guarantee and enhanced Performance Guarantees
14
2018 Summary •
• • • • •
Benefits and Network Stays the Same Expanded Pharmacy Network Significant pharmacy savings at a time trend is increasing at a higher pace than medical Clinic Integration w/Wellness Program Minimal premium increase for Employees & Retirees Improved service level for FMLA & EAP administration
15
QUESTIONS?
