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HomeMy WebLinkAboutContract 18752-C CITY SECRET Y CONTRACIL THIRD PARTY ADMINISTRATOR AGREEMENT This Third Party Administrator Agreement ("the Agreement") is by and between Harris Methodist Select Plan, Inc. d/b/a North Texas Health Benefits, a licensed Texas third party administrator ("TPA") and the City of Fort Worth ("the City"). RECITALS WHEREAS, TPA is engaged in the business of performing administrative services for self-funded indemnity health benefit plans; WHEREAS, the City provides a self-funded indemnity health benefit plan for its employees and other covered persons; WHEREAS, the City desires to contract with TPA to provide administrative services to it in connection with the self-funded indemnity portion of its health benefit plan; NOW, THEREFORE, for and in consideration of the mutual terms, covenants, and agreements set forth below, TPA and the City agree as follows: SECTION ONE: DEFINITIONS 1.1 "Covered Person"means an employee or other person eligible for coverage under the Plan Document. 1.2 "Plan" means the self-funded indemnity portion of the health benefit plan established by the City to provide health benefits for its employees and certain other persons. 1.3 "Plan Document" means the documents that set forth the eligibility and benefit provisions of the Plan and provides for the payment or reimbursement of eligible expenses. SECTION TWO: TPA SERVICES TPA will provide the following services: 2.1 Respond to inquiries from Covered Persons and providers regarding eligibility requirements and plan benefits. 2.2 Provide telephone coverage verification on normal business days from 8:00 a.m. to 5:00 p.m. 2.3 Provide pre-cei tification for non-emergency hospital admissions and certification for emergency hospital.admissions. 2.4 Provide continuing stay and discharge planning services for Covered Persons who are hospital inpatients. G�'/0� 9Q:�4_ Contract Authorization / �/ Date T 2.5 Provide retrospective utilization review of all hospitalizations of Covered Persons. 2.6 Provide catastrophic case management services by first identifying the catastrophic medical cases and then reviewing and continuing to monitor the health care delivery plan for such patients. , 2.7 Provide utilization review services, including pre-certification and certification services, for all psychiatric services provided under the Plan. 2.8 Receive, review, and verify the eligibility of all claims from Covered Persons. 2.9 Review claims to determine that (a) the charges are necessary and reasonable, (b) the diagnosis is eligible for reimbursement, and (c) coverage is in force. 2.10 Assist Covered Persons in the filing and processing of claims. 2.11 Coordinate Plan benefits with other benefit plans,insurance plans,HMOs, and other payors. 2.12 Process and issue checks to Covered Persons or providers, as applicable under the Plan. 2.13 Notify claimants in writing of ineligible claims, indicating the reason for the denial. 2.14 Furnish upon request standard claim forms and I.D. cards. 2.15 Provide to the City the following monthly claims reports: (a) Claims analysis by line of coverage and total, (b) Claims list by participant, (c) Claims pending report, and (d) Check and deposit register. 2.16 Provide to the City quarterly claims and management reports, including contributions, income, and claims paid and expenses. 2.17 Provide the necessary data to the City and assist City with preparation of any regulatory reports and filings, including any reports required by ERISA (if applicable). 0118932 -2- 2.18 Throughout the term of this Agreement and any renewals thereof,provide two persons on site at the City's offices during regular business hours to assist in providing the services set forth in this Agreement. TPA may employ such persons or may contract with Harris Health Plan to provide such persons. 2.19 Place one or more remote computer terminals in the City's offices to facilitate communication and contemporaneous record-keeping. 2.20 Provide all other administrative services proposed by TPA or its agent in its Bid Proposal, which documents are hereby incorporated by reference into this Agreement. If there is any conflict that exists with regard to services between the Bid Proposal and this Agreement, the Bid Proposal shall control unless the City decides otherwise. This Agreement does not relate to, and is not applicable to, any benefits provided by the City to any persons covered by Harris Health Plan. SECTION THREE: SERVICE FEE The City shall pay TPA a fee of five percent (5%) of the claims paid during the previous month. In the event, however, that the amount of claims paid by the City during a month exceeds 120% of the amount of claims projected for that month by TPA ("the aggregate attachment point"), TPA shall not be entitled to any fees for claims over the aggregate attachment point. The City will pay such fees within ten (10) days of the date that the City receives such statement. SECTION FOUR: REIMBURSEMENT FOR ACTUAL EXPENSES The City shall reimburse TPA for the actual expenses incurred as follows: 4.1 Printed material, such as any special bulletins sent City employees, authorized by the City or as otherwise provided herein. 4.2 Special mass mailings (benefit booklets, insurance certificates, employee status reports, etc.) requested by the City. 4.3 Copy costs at $.15 per copy. SECTION FIVE: LIMITATION ON TPA AUTHORITY The services to be performed by TPA shall be ministerial in nature and shall be performed within the framework of policies, interpretations, rules, practices and procedures made or established by the City. The City retains all final authority and responsibility for the Plan and its operation. TPA is empowered to act on behalf of the 0118932 -3- City in connection with the Plan only as expressly stated in this Agreement. TPA shall not have discretionary authority or discretionary controls respecting management of any trust fund and shall not have authority to exercise any control respecting management or disposition of the assets of any trust fund and shall not render investment advice with respect to any money or other property of any trust fund and shall have no authority or responsibility to do so. SECTION SIX: CITY'S DUTIES AND OBLIGATIONS 6.1 Benefit and Plan Information. The City shall provide TPA current and updated (including all revisions or changes) information on its Plan and on all Covered Persons on a format reasonably sufficient to enable TPA to carry out its duties and obligations under the Agreement. The City shall notify TPA within a reasonable period of time of any changes to such information irrespective of whether such change is occasioned by an election to participate, an election to terminate participation, or eligibility requirements. 6.2 Information for Audit and Management Reports. The City shall mail to TPA all written materials necessary for TPA to complete any required monthly and/or quarterly report, as determined by TPA, which are in the possession of the City no later than the two weeks prior to the date that such audit or report must be submitted. 6.3 Responsibility for Funding of Plan and Payment of Claims. TPA does not insure or underwrite the liability of the City under Plan. The City has and retains the ultimate responsibility for funding of, and payment of claims under, its Plan and all expenses incidental to such Plan. TPA shall not be required, under any circumstances, to issue payment(s) for any Plan benefits or any other costs arising out of the subject matter of this Agreement unless the City has previously deposited sufficient funds in the Claims Escrow Account as set forth in Paragraph 7.2, to cover such payments. 6.4 Governmental Report and Tax Responsibility. All government reports including those required in connection with the reporting and payment of federal, state or local taxes are the sole responsibility of the City. TPA will assist with all filings required by State or Federal law relating to the Plan. All taxes either imposed on the Plan or relating to the administrative services provided under this Agreement or resulting from the benefits provided to Covered Persons are the sole responsibility of the City. 6.5 COBRA Responsibility. TPA shall assist the City with all notices and information that it is required to give to its Covered Persons and any record keeping relating thereto pursuant to any federal, state or local law (specifically including but not limited to those required pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985 ("COBRA"), Public Law 99-272). 0118932 -4- TPA shall be responsible for providing any notice to Covered Persons required by COBRA whenever TPA receives notice from the City stating that a qualifying event has occurred and that such notice should be provided. TPA shall assume full liability for any failure to provide adequate notice under COBRA once the City has delivered said notice to TPA. 6.6 Responsibility for Determinations and Interpretations Under the Plan. The City shall be solely responsible for determining eligibility criteria for its employees, group members, dependents and any other persons who are eligible for benefits provided under the Plan. The City shall be responsible for any eligibility verification errors occurring in connection with TPA's obligations hereunder. The interpretation or explanation of any provision contained in the City's Plan Document is the sole responsibility of the City. TPA shall assist the City in making such determinations and interpretations and shall communicate same to City's employees, group members, dependents and other persons. The City shall be responsible for review of any appeals of denied claims. 6.7 Information to be Furnished by the City. The City shall furnish TPA with all information necessary for the administration of benefits under the Plan, as TPA may reasonably require. SECTION SEVEN: CLAIMS ESCROW ACCOUNT 7.1 Establishment of Account. The City shall establish a Claims Escrow Account. The City shall designate TPA as"signatory"or"administrator"of such Claims Escrow Account with full power and authority to disburse funds, and shall execute and deliver to TPA and the depository bank any and all documents necessary to empower TPA to act as signatory or administrator of such account. 7.2 Deposits to Account. TPA shall notify the City by telefax of the amount required to be initially deposited in this Account, and the City shall make such deposit. TPA shall determine such amount by estimating the City's liability pursuant to the Plan for a one-month period. Thereafter, TPA shall notify the City by telefax of the amount of deposits required to be made by the City so as to maintain the Account at a level determined by TPA to be sufficient to cover the City's liability for at least a one- month period. The City shall make such required deposits within five (5) days of the date that the City receives notice of the need to make such deposit. SECTION EIGHT: EFFECTIVE DATE AND TERM 8.1 Effective Date. The Effective Date of this Agreement is October 1, 1991. 8.2 Term. The term of this Agreement shall be for one year commencing on the Effective Date set forth above. 0118932 -5- 8.3 Option to Renew. The City shall have the option to annually renew this Agreement for three successive one-year terms,with each term to commence on October 1. If the City does not notify TPA of its desire not to renew the Agreement at least sixty (60) days prior to the conclusion of this one-year term or any successive one-year term, the Agreement shall be extended for a one-year term. SECTION NINE: TERMINATION 9.1 Termination With Cause. At any time, either party shall each have the additional option to terminate this Agreement for cause, upon thirty (30) days prior written notice following the occurrence of any of the following events: (a) Failure of the other party to comply with any provisions of this Agreement thirty (30) days after receipt of written notice; (b) Failure of the other party to comply with applicable statutory or regulatory requirements fifteen (15) days after receipt of written notice; (c) Fraud or embezzlement on the part of the other party. 9.2 Effect of Termination: Upon termination, TPA shall complete processing of all claims for benefits under the Plan and shall receive a fee of five percent (5%) of claims payable as reimbursement for expenses incurred and paid after termination or incurred prior to termination but not paid until after the date of termination. Such fee shall be due and payable thirty (30) days from date of invoicing by TPA. SECTION TEN: RECORDS AND FILES RELATING TO ADMINISTRATIVE SERVICES TPA shall maintain all records in conjunction with the administrative services to be performed hereunder. The City shall have the right to examine the records of TPA relating to benefit payments, claims for benefits, and the issuing of drafts for payment of benefits under the Plan; provided, however, that any examination of individual benefit payment records shall be carried out in a manner agreed to between the City and TPA designed to protect the confidentiality of the Covered Person's medical information. In the event of the termination of this Agreement, TPA shall' deliver the appropriate information on all claims histories, worksheets, and claims analysis to the City; provided however, TPA shall be entitled to retain copies of any such records at its own expense. All data and records pertaining to all transactions relating to Covered Persons are the property of the City. SECTION ELEVEN: INDEMNIFICATION 11.1 Each party shall be liable for its own acts and omissions incurred in the performance of its specific obligations under this Agreement. 0118932 -6- 112 It is the intent of TPA and the City to cooperate fully with each other with respect to any such claim or suit against either party. 11.3 TPA agrees to maintain the blanket bond coverage required by the Texas State Board of Insurance to indemnify and hold the City harmless against any and all loss, damage and expense including court costs and attorney fees resulting from or arising out of dishonest, fraudulent or criminal acts of TPA's employees, officers and agents in performing services under the Agreement. 11.4 It is the intention of both parties that, without the consent of the other, neither will in any case take any action, waive any defense, or compromise any suit which would knowingly prejudice the other party's defense with respect to the commission of a crime or the violation of any penal provision of any state's insurance laws, unless required to so by law. SECTION TWELVE: COMPLAINTS AND LITIGATION The City and TPA shall promptly notify the other of any complaint to or from any state or Federal regulatory authority of which each party becomes aware in connection with any transaction covered by this Agreement. If a suit arises as a result of any rejected claim or denial of benefit, eligibility, or coverage, the City will defend at its expense and pay any judgment arising therefrom, unless, at the City's request, TPA agrees to defend such claim at the City's expense or upon such other terms and conditions as the parties shall agree upon. In no event shall the City be responsible for any damages or defense costs arising from the negligent or willful conduct of TPA. SECTION THIRTEEN: GENERAL PROVISIONS 13.1 Relationship of Parties. In performing the services herein described, TPA shall be acting only as an independent contractor and shall not be,designated or deemed the administrator with respect to the Plan or the appropriate named fiduciary for review of claim denials under the Plan for the purpose of the Employee Retirement Income Security Act of 1974 or any other Federal or state law of similar nature. TPA shall arrange for the provision of all services hereunder as an independent contractor and not as an officer, agent, servant or employee of the City. 13.2 Responsibility of Parties. The City is solely responsible for its obligations under the Plan. TPA undertakes to provide administrative services only. TPA shall use ordinary care and reasonable diligence in the exercise of its powers and the performance of its services, and shall not be liable for any loss unless resulting from its negligence or willful misconduct. 13.3 Non-Appropriation of Funds. In the event no funds or insufficient funds are appropriated and budgeted in any fiscal year for fees due pursuant to this Agreement, the City shall notify TPA as to the prospective date on which said funds 0118932 -7- will no longer be available; this Agreement shall be terminated on the last day of that month in which said notice is effective without penalty or expense to the City of any kind whatsoever, except as to the portions of fees herein agreed upon for services rendered through the effective date of termination. 13.4 Severability. If any part, term, or provision of this Agreement shall be held void, illegal or unenforceable, the validity of the remaining portions or provisions shall not be affected thereby. 13.5 Appendices. Each Appendix and Exhibit to this Agreement, including TPA's Bid Proposal, is a part of this Agreement as if set forth as a numbered paragraph. 13.6 Notices. Any notice required or contemplated to be given pursuant to the terms hereof shall be in writing and sent by either certified mail, return receipt requested, postage prepaid, hand delivery or telefax to: President HARRIS METHODIST SELECT PLAN, INC. 1300 Summit Avenue, Suite 300 Fort Worth, Texas 76101 Telefax Number: (817) 878-5889 and to: CITY OF FORT WORTH 1000 Throckmorton Fort Worth, Texas 76102 Attention: Risk Manager Telefax Number: (817) 871-8359 13.7 Venue and Jurisdiction. Should any action, whether real or asserted, at law or equity, arise out of the execution, performance, attempted performance or non- performance of this Agreement, venue for said action shall lie in Tarrant County, Texas. This Agreement and any action in connection herewith is and shall be governed, construed and enforced by the laws of the State of Texas. 13.8 Audit and Review. TPA's performance of services and maintenance of records pursuant to this Agreement shall be subject to review by the City at any time. Review will be at the sole expense of the City and upon reasonable notice during ordinary business hours. TPA will provide any reports and data with respect to the performance of services as may be necessary from time to time upon thirty (30) days prior written request by the City. 0118932 -8- 13.9 Use of Name. The City shall not use the name of TPA except as authorized in writing. TPA shall not use the name of the City except as necessary for the performance of this Agreement and as authorized in writing. TPA shall not perform any written or oral surveys of Covered Persons unless the City and TPA have agreed in writing to the scope, content, method of contact, purpose and publication of survey. Such survey shall canvass only the City's Covered Persons, except when the survey is with enrolled members of other groups similarly contacted. When consent is required, TPA shall contact the City's risk manager who must agree or disagree in writing with the survey within seven days after being contacted by TPA or such survey will be deemed acceptable by the City. 13.10 Amendment. This Agreement shall not be modified or amended except in writing, signed by an officer of TPA and the City. The waiver by a party of a breach or violation of any provision of this Agreement shall not operate as, or be construed to be, a waiver of any subsequent breach or violation thereof. 13.11 Enforceability. The invalidity or unenforceability of any terms or provisions hereof shall not, unless otherwise specified herein, affect the validity or enforceability of any other term or provision of this Agreement. 13.12 Headings. The headings contained herein are for convenience of reference only and are not intended to define, limit or describe the scope or intent of any provision of this Agreement. 13.13 Waiver. The waiver by either party of any of the terms or provisions of this Agreement shall not be deemed to constitute a waiver of any of its other terms or provisions. No waiver of the provisions of this Agreement shall be deemed to constitute a continuing waiver thereof unless otherwise expressly provided herein. 13.14 Execution in Counterparts. This Agreement may be executed in counterparts, all of which together shall constitute one and the same instrument. 13.15 Access to Books and Records. Until the expiration of four years after the furnishing of services pursuant to this Agreement, TPA shall make available upon written request of the Secretary of Health and Human Services, or any of their duly authorized representatives, a copy of this Agreement, and those of its books, documents and records that are necessary to certify the nature and extent of costs incurred by TPA under this Agreement. If TPA carries out any of the duties of this Agreement with a value of$10,000 or more over a twelve-month period through a subcontract with a related organization, such subcontract must contain a clause to the effect that until the expiration of four years after the furnishing of services under the subcontract, the related organization shall make available upon written request of the Secretary of Health and Human Services or the U.S. Comptroller General, or any of their duly authorized representatives, the subcontract, and those of its books, documents and 0118932 .......... .. -9- records that are necessary to certify the nature and extent of costs incurred by Select Plan under the subcontract. 13.16 Assignment and Delegation. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. Neither party shall assign, subcontract or otherwise delegate its rights and responsibilities under this Agreement without the other's prior written consent, which consent may be withheld solely at the discretion of such party. IN WITNESS WHEREOF, and as duly authorized, the parties hereto execute this Agreement with the Effective Date herein provided. HARRIS METHODIST SELECT PLAN, INC. D/B/A NORTH TEXAS HEALTH BENEFITS 2 By: Title:— 4Atd":j A QfILA- Date: ATTEST: CITY OF FORT WORTH By: Title: Asgi-s:4o.kij Cll z Maoa�,Pi- City Secretary Date: APPROVED AS TO FORM AND LEGALITY: City Attorney G?- 2- Date 0118932 -10- ATTACHMENT 1 GROUP HEALTH PROPOSALS - BASIC FEATURES HARRIS METHODIST NORTH TEXAS SANUS/ HEALTH PLAN HEALTHCARE PLAN NEW YORK LIFE PLAN HMO portion is f dly-hsumd Self-im and Sclf inmmd Indemnity is self-insured High or Low Prokned Provider Or—lxation High HMO plus NYL Mgb)Uw HMO ply OR Mast live in service ama Non-network option Low HMO only 3 chdccc High HMO;Low HMO.4ndcmaity *Required for all who Bye oat of HMO area; (an option for all others) Pm-certification for in-patient and out-patient hospital p=dures is REQunu D FOR ALL TBREE PLANS. High 35 per visit High S10 per rut High$5 per visit L ciw$10 por visit Law$10 par visit Iaw$10 per visit Indemnity W=abler 3300 arced deductible Non-network 7030 after$300 annnd deductible Indemnity 8=after$700 tamal dodoetiblo High 10056 High 909E after$200 aaaual deductible High HMO$100 Law 80%of first 54000 then 1t10% Low 30%after$200 serer dodactiblo Low HMO$275 Indemnity 80/10 after$300 armed deductible Nom-network 70130 after 3300 ae—A deductible+$200 indemnity 80!10 alkr$200 srmual deductible per admission High$15 co-pay High 90%-occident High$40 per visit High 90%+$200 annual deductible for illaea Law 20%co-pay Low 8096-rccidont Law SO per visit Low 80%after$200 onsud deductible for iline® Indemnity WM alter$300 annual deductible Non-network 7030+$300 annual deductible Indemnity 80/10+5200 annual deductible The Primeeam Centers also offer a plan of ono for 310 per visit for High or Low mnmI Pedant pays fail}ill leas discount;mimbureomest is 100%leas $10 on-pay. High 35 c i-pry High 10%after$200 armed deductible High$50 co-pay Low$10 co-pay Low 20%after$200 annual deductible Law$100 co-pay Indemnity 20%after$300 annual deductible Non-network V30 after$300 annual deductible indemnity 80x10 otter$200 annual deductible t High or Low High or taw High or Low $5 EACH CO-PAY Brand:$10 or 30%whichaver is higher,Generic:36 at 32 geaerie;$7 brand 20%whichever is higher. No deductible No deductible. $75 annual deductible limit-30 day supply Quantity per doctor's orders Quantity per doctor's orders Indcr pity-annual$300 deductible 20%rte generic Non-network-7080 rafter anaud$300 deductible only.patient pays difference for brand name Rs. Large pharmacy network includes Skaggs,Bckord, Ergo network-Town alt Conntry based Swap for Eck ard,Tom Thumb.Town alt Country K-Mart,Tom Thumb,Kroger and some in do- Tarrant County,Skaggs,Tam Thumb,Kroger, pendant firms. Wine-Dixie and independent firms;nationwide network elsewhere. No mail order Generic-10091 with no co-pay and no deductible; No deductible;32 co-pry for sip to 90 day supply Brand-pay for up to 100%finer 32 co-psy. High$800 per person;$2400 per family High$800+deductible per parson;31600+deductible HMO$650 per person;$1500 per r®dy per idly _ Law Same as above taw 31500+deductible per person;33000+deductible Indemnity 31500+deducible per person; 4500+ Por'�dy deductible fsmil Non network$3000+deductible per person;36000+ •Indemnity$1500+dahmdblo per person;$4500+ Per y deductible per family doductibic per family All Harris locations(10) All Harris locations(10) All Saints-two locations All Saints-two locations Methodist-Dally Medical Phu Huguley Huguley Hagulay Arlington MomwW Arington Mamorid Arington Memorial Walls Regional pmebylorian-Ddlas Owoopathic Medical Cantor CookRort Worth Children's Cook/Fort Worth❑dldmn's CooWFort Worth Childroe's Bridgeport Wills Regional Campbell Memorial Decatur This brief comparison is for information purposes only.For a detailed and precise statement of the benefits available to you,complaint proce. dures,or the companies'fmancial status,ask your Insurance Department for a copy of the current benefit lists. Attachment 2 FY 1991 FY 1992 Difference Total Cost $20,230,871 $22,554,708 $2,323,837 11.49% Actives $14,954,195 $17,409,198 $2,455,003 16.42% Retirees $5,276,676 $5,145,510 ($131,166) -2.49% Contributions Actives $3,831,959 $4,403,561 $571,602 14.92% Retirees $1,367,006 $1,150,421 ($216,585) -15.84% Net City Cost .Actives $11,122,236 $13,005,637 $1,883,401 16.93% Retirees $3,909,670 $3,995,089 $85,419 2.18% Oti LTJ t7i M rAj t-I 0 m z a a s 5 0 :3 " > 0 10 PC ft I-, fl m I-a Fl F, H ti (D 0 0 0 0 0 0 0 0 0 0 0 0 0 tl• 0 (D l< L< L< •< l< L< L< l< 0 �< l< &.� l< 10 tr rt " m m m m H m m m m b m m m m L-3 r. m m m m 1-3 m m m m m m 0 m H rt fl tl K H 0 ►0 1- z aav� a 11 rt 0 Mi 0 r:0 IV 0 0 t2i 0 0 :r P-h :r 11 N fl• w m P- m CL F' (D CL 0 0 L< 0 0 0 t r (D (D (D 0 :1 (D 0 :• 0 4A -W 4A in 0 t-3 4A to in to 0 H in 4A to in 0 1-3 1"• 0 -j w 0 N CZ 0 0 w 1p F, 0 0 0 w w N 0 n 0 tr w w " w 0 rt ft N w -P, m 0 rt rt w N CA w 0 rt rt f- 0 to Ln K) m :zr W w ui K) m :r 0 a% -j %D ui w :r W rt t-h rt F- H rt Fl Fl rt H H �4 CA L< a% 00 m 4�b l< A. 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W O ►-� t-� t-+ v rn u1 r• -1 ZD w GD I-+ .P t-� W 0 J tD !-+ w N W N 0 N J N OD W 00 m 0 7d G (D rt n D ((D D M n 3 rn z w C-) Approved M&C C-12956 with the following added: 1. Upon the effective date of the new plan, all new employees shall be covered solely by the HMO plan. 2. The adoption of the plan is conditional upon Harris permitting all accredited hospitals and doctors under appropriate objective criteria, to participate upon the same terms as those hospitals in the Harris system, with express understanding that Harris will use its best efforts to facilitate entry of FW Osteopathic, Hugley and Medical Plaza hospitals within 30 days and the City retaining the right to cancel this agreement if such best efforts are not utilized. 3. It is the intention of this city to restrict employee participa- tion within the service area to the HMO in Fiscal Year 1992-1993 or to place all additional costs for participation in the so called indemnity plan solely on the employee. 4. Staff submit contract for council approval . 5. That each employee pay an additional $3.00 per pay period above the original staff recommendation. Harris Methodist t, Health Plan 0 April 8, 1993 Ms. Susan Bulla Director of Risk Management City of Fort Worth 1000 Throckmorton Fort Worth, TX 76102 Dear Susan: This letter is a follow-up to our March 31, 1993 meeting in which we mutually agreed to an enhanced application of the Rehabilitation Services benefit, from the applicable Schedules of Benefits as follows: • Low Option HMO-Plan 10: Section IX • High Option HMO-Plan 1-5: Section IX • Self Funded Plan: Section VIII The enhanced application benefit retroactive to January 1, 1993,provides that covered short- term rehabilitation treatments will be limited to sixty (60) consecutive days or twenty-five (25) visits per condition, whichever is greater. As agreed, there will be no changes to your premium structure. Please indicate your concurrence by endorsement to this letter. Thank you. Sincerely, on in • Senior ice President City Official Managed Care Marketing A member of Harris Methodist Health System 1300 Summit Avenue/Suite 300/P.O.Box 901054/Fort Worth,Texas 76101-2054/817-878-5800/Customer Service Telephone Number 817-878-5826 Harris Methodist 93 APR 508 Health Plan April 8, 1993 Ms. Susan Bulla Director of Risk Management City of Fort Worth 1000 Throckmorton Fort Worth, TX 76102 Dear Susan: This letter is a follow-up to our March 31, 1993 meeting in which we mutually agreed to an enhanced application of the Rehabilitation Services benefit, from the applicable Schedules of Benefits as follows: ® Low Option HMO-Plan 10: Section IX ® High Option HMO-Plan 1-5: Section IX ® Self Funded Plan: Section VIII The enhanced application benefit retroactive to January 1, 1993,provides that covered short- term rehabilitation treatments will be limited to sixty (60) consecutive days or twenty-five (25) visits per condition, whichever is greater. As agreed, there will be no changes to your premium structure. Please indicate your concurrence by endorsement to this letter. Thank you. Sincerely, on in 6z . Senior ice President City Official Managed Care Marketing A member of Harris Methodist Health System 1300 Summit Avenue/Suite 300/P.O.Box 901054/Fort Worth,Texas 76101-2054/817-878-5800/Customer Service Telephone Number 817-878-5826 26 (.N C'i of Foof Wortk Texas Mayor and Councft Communication. DAM - REFERENCE U .NUMBER LOG NAME I PAGE 07/09/91 1 C-12956 15HARRIS I I of 4 SUBJECT CITY EMPLOYEE HEALTH INSURANCE AGREEMENTS WITH HARRIS HEALTH PLAN INC. D/B/A HARRIS METHODIST HEALTH PLAN, AND WITH HARRIS METHODIST SELtCT PLAN, INC. RECOMMENDATION: It is recommended that the City Council , subject to sufficient funds being appropriated in the City budget for Fiscal Year 1991-1992 to pay for obligations incurred under the , proposed contracts, authorize the City Manager to: 1. Execute a one year contract (with options to renew for four additional one year periods) with Harris Health Plan, Inc. , d/b/a Harris Methodist Health Plan for the provision of HMO group health insurance benefits for active and retired employees and their spouses or dependents through an insured contract effective October 1, 1991, according to the premium rates quoted in Attachment 2. These costs are estimated to be $18,278,000.00 for the 1991-1992 Fiscal Year if enrollment occurs as predicted, and 2. Execute a one year professional services agreement (with options to renew for four additional one year periods) with Harris Methodist Select Plan, Inc. , to administer the City' s self-funded indemnity program for its active and retired employees and their eligible spouses or dependents for 1991-1992 maximum claims, with an administrative fee not to exceed five percent of estimated maximum incurred and paid claims, re-insurance.premiums, and conversion premium estimated to total $3,976,708.00. DISCUSSION: On January 1, 1989, the City of Fort Worth began offering its group health insurance program for active employees and their eligible dependents through one carrier in a- managed care environment (with an opt-out to traditional indemnity coverage) via a fully-insured contract with Sanus Texas Health Plan, Inc. (Sanus).. On October 1, 1990, the City offered a two-tiered benefit plan (Low Option and High Option) on a self- insured basis utilizing Sanus as its administrator for HMO as well as indemnity coverage. Effective January 1, 1991, the administration of the group health insurance program for eligible retirees and their dependents was moved from a self-funded traditional indemnity program administered by Aetna to the self-funded, two-tiered benefit program administered 6y Sanus. The program also was converted from a Medicare supplement coordination of benefits to one of Medicare carve-out, as directed by City Council . The contract for administration for both the active employee and the retired employee programs expires September 30, 1991. In late winter of 1990-1991, City staff began planning the process to solicit proposals from providers/administrators/carriers to offer a group health insurance program for the City' s active and retired employees and their spouses or dependents. Informal Printed on recycled paper Ciety of Fort Wortk Texas Mayor and Council Colmmunicati46n DATE 07/09/91 1 REFERENCE NUMBER C-12956 LOG NAME 15HARRIS PAGE 2 of 4 SUBJECT CITY EMPLOYEE HEALTH, INSURANCE AGREEMENTS WITH HARRIS HEALTH PLAN I NC D/B/A HARRIS METHODIST HEALTH PLAN, AND WITH HARRIS METHODIST SELPCT PEAN, INC. Report 7510 (February 12, 1991) informed Council of staff' s plan and advised that the solicitation would be for a duplication of current services. The staff decided to solicit proposals for the following reasons: 1) There is currently more representation in the local marketplace by companies able to offer managed-care products/services; and 2) A public solicitation had not occurred since 1988 (for a program effective January 1, 1989) . Committees of active and retired employees served to provide input to the City Manager throughout the solicitation, analysis, and recommendation process. The Request for Proposals (RFP) was prepared by the City' s consultant for group health benefits, Asset Protection Agency, Inc. (APA) . Requests for plan proposals were sent out March 25 with an April 26 deadline for returning proposed plans. The City received responses from a total of eleven different vendors. Of these, only five vendors responded with complete and responsive proposals to administer the entire program. After review and evaluation of all of the proposals, three were selected as finalists by the RFP evaluation criteria for further consideration and examination. These were: - Harris Health Plan, Inc. , d/b/a Harris Methodist Health Plan, and Harris Methodist Select Plan, Inc. - North Texas Healthcare Network - Sanus Texas Health Plan, Inc. The plans under consideration were presented to the City Council Insurance Committee and the employees' and retirees' advisory committees. The respective advisory committees took information back to their departments for further review and solicited input from the employees and retirees whom they represent. At the joint meeting of the active and retired employee committees which met June 13, the committees overwhelmingly registered their preference for the plan offered by Harris Health Plan, Inc. d/b/a Harris Methodist Health Plan, and by Harris Methodist Select Plan, Inc. The Harris Methodist Select Plan, Inc. , is a third party administrator which will administer a self-insured plan of indemnity health benefits for employees and retirees and their spouses or dependents who live outside the Harris HMO service area. This program would also cover those employees, retirees, and their spouses or dependents who reside in the service area, but may elect the indemnity plan as their chosen method of group health benefit. The cost of this administration is five percent (5%) of maximum incurred and paid claims. The indemnity coverage shall have basic plan features of $300.00 annual deductible and 80/20% co-insurance. The staff and consultant undertook a careful , independent analysis of , the proposed programs, and the Harris Methodist Health Plan and Harris Methodist Select Plan are I Printed on recycled paper '01M .. •+. L" �r�.rp.LWU_.i 4 s� «rmi z. .,�m:.MsvC�- -" E' a^',fisa"'''y-•' ^i�^ rt--r- •�.c;•.- 9 c • r s - i. Gyy.- - uH, qq• ..,.....w.,...".�....,........�,..... . ...:w:...«,-.•..�:.,;.....•....,..,.,.,..,,v-r_.;s....,r„_..w.a...�.c,..•..,,......,,..-.,-r...-r— .,,.-....;._._..,-.--..,....�..._�.. •. -.:r:: DATE REFEREM E„�UF1BE WIW- �,2 WA e,�t .a,.t J,<�� ; A s ; C-124arfa� d. - __L51iARRIr e:.. w ' A4a ; . SUBJECT �G:I1 � @luHA � WINMAP" RH .,,4 AR�EI �S"('�S�C�� _INC�. ky recommended by staff to provide.-group=..health --insuranrc ilb'enjt_f `ait61,r_ `-4,te6 for active and retired employees-and- their spouses or dependents for the fal�owin•g — reasons: 1) A major portion of the City's liability is fully-insured with future years' cost increase guarantees which make this proposal slightly less costly over a two-�dg period. 2) There is an extensive panel of physicians and facilities to serve the Tarrant County area and 18 area counties. 3) The employee and retiree committees advising the City Manager overwhelmingly selected this finalist as the choice of the committee members. 4) Information received from the State Board of Insurance and contacts with local - benefits managers where this program is offered provided positive responses regarding Harris Methodist Health Plan. Additional information and a plan design comparison among the three finalists is provided in ATTACHMENT 1. Each of the three proposed plans will maintain basically the current level of benefits with varying deductibles, maximum out-of-pocket expenses and charges; however, would require additional funds to finance the City's maximum liability for the forthcoming year It is recommended that employees be assessed a portion of the cost for his/her own coverage regardless of the option selected. In the current year,. the employee selecting the Low HMO Option contributes nothing toward the cost of his/her own coverage. - - It is recommended that each Low Option employee pay $3.00 per pay period or $6.50 per month toward the cost of his/her own coverage for the Low Option Plan. Each high option employee would pay an additional $3.00 per pay period or $6.50 per month. The employee will pay no additional contribution above that paid in the Fiscal Year 1990_-91 for his/her spouse or dependents. The City's contribution toward the cost of the employee's own coverage increasit" by. $6.50 per month for Low Option coverage, by $10.90 per month for High Option coverage, and by $70.13 per month for those employees. elect of the indemnity plan. The total cost, recommended Limp loyee/retiree contribution rate and City contribution• is illustrated on ATTACHMENTS 2 and 3. Funds in the amount of $22,254,708.00 to support* the estimated cost of the entire program will be included in the City Manager's recommended budget for Fiscal,'-Year 1991-1992. PrWftd on T 'N" . ., ¢:+q 1r'-t_v^z_.cc2 ...t. �.^,. -`^+ C rzs±•r._i sns u.:� .. ,..Y•F• Mr � � —��..•t-"'-�`_T�' "'�"'•�`�"' _'_-'1;'�°r.?r!S� ^vim --tna"�'�• -..."5 4- �_` _ n .a.. _ '. Yj �S' ' 7 -^t'•.^r 7 � 1. ,. L� �•^' rC'-yl ''c •u%.u1r�m ••4.,J { L J r s1, r.. _ 1„ MR 1.7 IWO A f '•,,,,,.,... . _..,-,..,r�•n+ -.c.m-w.rM•v*v+^Y++T:.!•Mta"M�Yve^`.•r..w<^✓+nY'n^'swe•e,re,N!o'P!'!kt'Yw o-...rrwrn-.^rK.`°ry^^,�.'e"rffl'wra�r^,�!^�"F+I• 7-r.. wv+wrmnR r^'^'n ,,,R K F�d - FISCAL„ FOD�Ma 07f/7.,'.:: n{/,L k yh� �_ "f f xJS : "�f ��! � ;" f R < t i cc ^F '�' Yk! a. � { t � W t� } The Di rector.. o' Fi sca Serve ces c , es-,t�i at"the money: require .for the 194 �" � fi� Fiscal Year will be included in the City' Manager`s proposed`budget.:. �, � p �i f- 2 s r r ',.J.� c, J-fir .� �c 11's S ' .q.Irz.�' CD:t F' - Y1 ; .r £rirC�4?r :.i �t=}Q ?�- .r. , !FY/ f�S^� dt: .' <_}Fld ` t :} _ _ x !�• :�; r ri �, .>,y�; t :z $r4 'z,,'� x. �.�_ ..tl�±�"�' r:� a. 1: �t: «. a`r-" I _.. d n. r .. , , J Submitted or City Manager's. FUND .ACCOUNT. CENTER AMOUNT... CITY SECRETARY-.:,_ Office by: to �� �11�1� BY . << Charles Boswell 8500 CITY C UN IL Originating .Department Head:. ,, r L ~JUL 213 1991' Susan Bulla 8513 (from) . For Additionat Information Contact: Susan Bulla 8513 ciy aso,otanr of th's yy ! ATTACHMENT 1 GROUP HEALTH PROPOSALS - BASIC FEATURES HARRIS METHODIST NORTH TEXAS SANUS/ HEALTH PLAN HEALTHCARE PLAN NEW YORK LIFE PLAN HMO portion is fully-insurod Self-inaamd Self-insured Indemnity is self-insured High or low Preferred Provider Oraenlxation High HMO plus NYL High/low HMO plus OR Meat live in service area Non-network option low HMO only 3 choices: High HMO;Low HMO;•Indemnity *Requited for all who Uwe oat of HMO area; (an option for all others) Pre-certification for in-patient and out-patient hospital procedures is REQUIRED FOR ALL TDREE PLANS. High$5 per visit High$10 per visit High SS pa visit Low S10pervisit Low510pervisit Low$10porvisit Indemnity 8WM after 5300 annual deductible Non-network 7Q30 albs$300 mural doductible Indemnity 80/20 after 5200 oannal deductible High 100% High 90%after$200 saunas deductible High HMO S10o Low 8096 of fast$4000 then 100% Low 8096 after$200 snnnal deductible Low HMO$275 Indemnity MM after 5300 annual deductible Nonmetworlc 70130 after$300 aama!deductible+S200 Indemnity 80/20 after S2o0 annual deductible Per admission High$15 co-pay High 90%-accident High$40 per visit High 90%+$200 anus!deductible for Mean Low 20%co-pay Low 8096-accident Low$40 per visit Low 80%alter$200 annual deductible for illness Indemnity 80/20 alter S300 annual deductible Non-notwotk 7030+5300 annual deductible Indemnity 80/20+5700 annual deductible The Prima am Canters else offer a plan of we for$10 per visit for High or Lew mnmbors.Patient pays toll bill loss discount reimbursement is 100%less $10 co-pap. High S5 co-pay High 10%after 5200 annual deductible High S50 co-pay Low$10 co-pay Low 20%after$200 annual deductible Lew$100 co-pay Indemnity 20%after 5300 soe-A deductible Non-network 7030 after 5300 anneal deductible Indemnity 80(20 after 5200 annual deductible High or low High or Low High or Low 35 EACH CO-PAY Rrsad:$10 or 30%whicberm is higher,Ooner9e:S6 or $2 genetic;$7 brand No deductible 20%whichever m higher. No deductible. $75 annual deductible Limit-30 day apply Quantity per doctor's orders Quantity per doctor's orders Indemnity-annual$300 deductible 20%for genorio Nou-notwork-70/30 after---1$300 daductibie only;patient pays difference for brand no=Rx. Larte pharmacy network includes Skaggs,Eekerd, Lugo network-Town At Country based group for Eckerd,Tom Thumb,Town At Country K-Mart,Tom Thumb,Kroger and some inde- Tarrant County;Skaggs,Tom Thumb,Kroger. pendent firm. Wmn-Dixie and independent firmo;nationwide network elsewhere. Hum No mail order Ocamic-100%with no co-pay and no deductible; No deductible;$2 co-pay for up to 90 day supply Brand.pay for cap to 100%after S2 co-pry. High SSW per pen=.$2400 per family High SSW+deductible per person;$1600+deductible HMO 5650 per person;$1500 per farmily per G Low Sawa above ravy Low 51500+dodact9blo per person;53000+deductible Indemnity MSM+deductible per person;54500+ Portly deductible flail Nmnetwork 53000+deductible perperson;36000+ Indemnity$1500+deductible per person:$4500+ Per y deductible per family deductible per family All Harris locations(10) All Harris locations(10) All Sainb-two locations All Saints-two locations Mothodist-Dallas Medical Plata Huguley Hugnley Huguley Arlington Memorial Arlington Memorial Adingtou Momorlal Walls Regional Pmebgtorian-Dallas Osteopathic Medical Center Cook/Port Worth Children's Cook/Fort Worth Children's Cook/Fort Worth Children's Bridgeport Walla Regional Campbell Memorial Decatur This brief comparison is for information purposes only.For a detailed and precise statement of the benefits available to you,complaint proce- dures,or the companies'fmancial status,ask your Insurance Department for a copy of the current benefit lists. Attachment 2 FY 1991 FY 1992 Difference Total Cost $20,230,871 $22,554,708 $2;323,837 11.49% Actives $14,954,195 $17,409,198 $2,455,003 16.42% Retirees $5,276,676' $5,145,510 ($131,166) 2.49% Contributions Actives $3,831,959 $4,403,561 $571,602 14.92% Retirees $1,367,006 $1,150,421 ($216,585) 15.84% Net City Cost Actives $11,122,236 $13,005,637 $1,883,401 16.93% Retirees $3,909,670 $3,995,089 $85,419 2.'18%' n K t=1 t=J tai tri H m m x m x t=7 CrJ t+i Cji ti O (D 9 H a S z a s a B H 3 3 O O 1-% ro ro ro to 0 ro to to ro O ro ro roro E rt 1-1 rr•rrr rrr x rrrr K m Q+ 0 0 0 O 0 0 0 0 0 0 0 0 O r• 0 m lG &< "G "G 7. l< l< 'C .< O Kkk "C h7 u rt M m m m m H m m m m ro m m m m H rat (D n m m m m K m m m m H m m m m H P. K ww (n aw (r _ 0 aaa7 zz or• a O 0 z a 0 O 0 r Q. a m Q. a. to a. a to to x ct 0 0 0 'TJ n O � hi n O O H P. to r ai r m 4 wr (D wrm wrm n O A .0 ° r a, O O K F( K ED O m O k � 0' O to to to to O H to to to to O H to to to to O H r• O J m m N 0 O O m w P. 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H. r• x C c C r r r r r r r n K n rt :4 r• r w n rt n n H. r- H. n n n rt O C C C m m m (D z C C C m m (D m 0 C C C m m m m ro r r r• (D (D m m H r• r• r• m m m m ro r• r• r• m m (D (D H G H z 7 G H G :1 ::s H to LO to P) P) P) K tq W to Pr P) P) H t4 to to Pr P) PL 0 :3 :3 n :3 :3 Z 0 Z :3 ::j z per, to a a a w � ro a a a z w �ro a a a x 9 r 0 I7 0 to 9 r• O w n to x r• 0 11 0 to :3: r• r G P) Zr b r• H G W to � r• r 0 5" tO O Fl a t0 3 r• 0 r a to 3 r• 0 O Fl a m � r• 0 K Fl U) K F, a � K HaU) K m K (D K n m ti (D (D m in � � z to to to in to to 0 H to to to in in in in 0 H to iW to in -En to to O H to m N P t✓ m w .P 0 :3 0 .P N W J .P m W 0 0 0 w F✓ N w w .P " 0 0 0 n Ln tD J W m P J 0 rt rt* w N t✓ pb W N F✓ 0 rt rr .P O w J .P J w O rt rt 0 OD .P N N tD m P to ]" W A. P O w m F' O m =• W F✓ Ut Ln m F✓ H Ln m a N b rt F-' F✓ . . . rtNr N .P N t0 N t0 J K w J w .P N O m K O N �.1 W O U7 J rt K Fl ~ N O m W to F✓ OD to m W N tD m to N to m tD .p 0 t0 (D d C1.t� d to to to to to to O � tI! to to to to to O to to to in to to W O "C 0 ON P. .P m N P 0 :3 (D P F- w P N W 0 G (D W H N W H N 0 z (D t' Ln W J Ln t0 J 0 rt G w N H W N H O rt 0 P O W Al O w 0 rt f P O to rt N m F✓ Ln N u, to to rr N m to tD J Ln t0 J Ln O K G O N J O N J O K v O m W O m W O rt m w N J .P w O ft Ln m tD u7 m tD O rt W ti 0 0 0 G rt' x7urt rt' � wK rt rJn m H O (D 0 rS 0 (D 0 rt 0 m 0 W to to to to to to r• G rt tlo to to tR to to to r• 0 rt to to to to to H. G rt to (D N t✓ N N N N to tr rt H. O F✓ N F-- N F✓ F, to O• rt r• 0 F- to P. F✓ to F✓ t7 rt W 0 it N Ut O N Ln O W G :31 H w 0 N J w N J w G N N OD F+ N 0 F✓ G o• " UI E tD O OD tD O 0 m fr H m m O P W O J W m rt H m m W N N W N ".to rt H m m m r K m t1 O m m O m m D Co tD Do t r K m 11 m 01 N O P O O tD O O G F-+ N P N Al O G OV w .P 0 LIt P O 0 0 J Ln 0 J to O 0 0 0 0 rt n 0 m c n 0 (D c rt 0 x z K z z z z z z z w O rt rt to to to to to to r- Z rt n to to to to r• � rmr n G tr rt r- rt r F✓ H F-+ 1- r to tr rt H. n F-+ to N F✓ to N a rt r• rt 0 '� '� .b '� '� .?� ',D• G G• L"t (D J l0 W N J J w G V L"t (D N OD F•+ N 0 F-+ G V n (D a rt F' (D 0 W o 0 J W W m rt F-' (D � w N N W N N to rt F- m 0 m r•K m rt r-K m rt . . • r• K (D rt 0 P w W N p P 0 0 tD oD tD tD DD 0 0 0 W 0 0 0 a n " 0 0 0 " 0 0 0 " 0 0 0 to to to to to to r• p r-b to in to to to to r- 0 r-'t9 to to to to to to r• G r•tO .P to N w Ln J Pb tr rt rt 0 N F- H F✓ -P. N tr rt rr 0 N in N .P N w N tr rt rt 0 (D N P. m O tJ W W G K to Al W .P J .P J G ::r K m N N N Ln Ln Ut w G V K m R. tD W W W OD OD W rt r (D .P to J O O J .0. rt N (D J N N N oo CD to rt t✓ (D r- t-� oD cn ZD to W m 0 :n 0 0 0 0 m to 0 O W OD 07 F✓ m J O P) tD P %D P tD P to 0 0 0 0 0 h' N J tD .P m OD W tD FS m 0 0 0 rt 0 G ft G rt 0 G P. z z z z z z z n p t) n to to to to n Z 0 n to to to to LO to to to N N N W rt W n to to to N N N H r rt W rt W ay :r, a� tr :71 rr m m .P w m Al w m tr x rt m J 0 w .P Fj F-+ m tr d' rt m tr �K rt o w J O w J .P z "G K : OD .P J 0 J t0 N rt K : (~D W O N N N v Orn cn r- .1 zD W Oo I-+ .P F-+ r 0 J tD N tD N W N 0 N J N O w w m 0 P:1 (D rt D tl (D (D ED n 3 m z w C-) c� 3c� a A b Cfty. of Foif Wofth, Texas Ar mayor and Councd- Communication. DATE REFERENCE NUMBER LOG NAME PAGE 07/09/91 C-12956 15HARRIS_ 1 of 4 SUBJECT I CITY EMPLOYEE HEALTH INSURANCE AGREEMENTS WITH HARRIS HEALTH PLAN INC. D/B/A HARRIS METHODIST HEALTH PLAN, AND WITH HARRIS METHODIST SELPCT PLAN, INC. RECOMMENDATION: It is recommended that the City Council , subject to sufficient funds being appropriated in the City budget for Fiscal Year 1991-1992 to pay for obligations incurred under the proposed contracts, authorize the City Manager to: 1. Execute a one year contract (with options to renew for four additional one year periods) with_Harris-Heal th;PIan, Inc'. , d/b/a Harris Methodist Health Plan for the provision of HMO group health insurance benefits for active and retired employees and their spouses or dependents through an insured contract effective October 1, 1991, according to the premium rates quoted in Attachment 2. These costs are estimated to be $18,278,000.00 for the 1991-1992 Fiscal Year if enrollment occurs as predicted, and 2. Execute a one year professional services agreement (with options to renew for four additional one year periods) with Harris Methodist _ Select Plan, Inc. , to administer the City's self-funded indemnity program for its active and retired employees and their eligible spouses or dependents for 1991-1992 maximum claims,' with an administrative fee not to exceed five percent of estimated maximum incurred and paid claims, re-insurance premiums, and conversion premium estimated to total $3,976,708.00. DISCUSSION: On January 1, 1989, the City of Fort Worth began offering its group health insurance program for active employees and their eligible dependents through one carrier in a managed care environment (with an opt-out to traditional indemnity coverage) via a fully-insured contract with Sanus Texas Health Plan, Inc. (Sanus) . On October 1, '1990, the City offered a two-tiered benefit plan (Low Option and High Option) on a self- insured basis utilizing Sanus as its administrator for HMO as well as indemnity coverage. Effective January 1, 1991, the administration of the group health insurance program for eligible retirees and their dependents was moved from a self-funded traditional indemnity program administered by Aetna to the self-funded, two-tiered benefit program administered by Sanus. The program also was converted from a Medicare supplement coordination of benefits to one of Medicare carve-out, as directed by City Council . The contract for administration for both the active employee and the retired employee programs expires September 30, 1991. In late winter of 1990-1991, City staff began planning the process to solicit proposals from providers/administrators/carriers to offer a group health insurance program for the City' s active and retired employees and their spouses or dependents. Informal Printed on recyded paper ity oj" Fort Wortk Texas Mayor and Council Communication DATE REFERENCE NUMBER: : LOG NAME PAGE 07/09/91' C-12956 15HARRIS 2 of 4 SUBJECT CITY EMPLOYEE HEALTH INSURANCE AGREEMENTS WITH HARRIS HEALTH PLAN INC. -- D/B/A- HARR-IS--ME-THOD-ME HEALTH PLAN,---AND WITH--HARRIS METHODIST: SELECT P_fAN, INC. Report 7510 (February 12, 1991) informed Council of staff' s plan and advised that the solicitation would be for a duplication of current services. The staff decided to solicit proposals for the following reasons: 1) There is currently more representation in the local marketplace by companies able to offer managed-care products/services; and 2) A public solicitation had not occurred since 1988 (for a program effective January 1, 1989) . Committees of active and retired employees served to provide input to the City Manager throughout the solicitation, analysis, and recommendation process. The Request for Proposals (RFP) was prepared by the City' s consultant for group health benefits, Asset Protection Agency, Inc. (APA) . Requests for plan proposals were sent out March 25 with an April 26 deadline for returning proposed plans. The City received responses from a total of eleven different vendors. Of these, only five vendors responded with complete and responsive proposals to administer the entire program. After review and evaluation of all of the proposals, three were selected as finalists by the RFP evaluation criteria for further consideration and examination. These were: - Harris Health Plan, Inc. , d/b/a Harris Methodist Health Plan, and Harris Methodist Select Plan, Inc. - North Texas Healthcare Network - Sanus Texas Health Plan, Inc. The plans under consideration were presented to the City Council Insurance Committee and the employees' and retirees' advisory committees. The respective advisory committees took information back to their departments for further review and solicited input from the employees and retirees whom they represent. At the joint meeting,of-the active and retired employee committees which met June 13, the committees overwhelmingly registered their preference for the plan offered by Harris Health Plan, Inc. d/b/a Harris Methodist Health Plan, and by Harris Methodist Select Plan, Inc. The Harris Methodist Select P1 an-, Inc. , is*--a third party admi'ni strator which -will administer a self-insured plan of indemnity health benefits for employees and retirees and their spouses or dependents who live outside the Harris HMO service area. This program would also cover those employees, retirees, and their spouses or dependents who reside in the service area, but may elect the indemnity plan as their chosen method of group health benefit. The cost of this administration is five percent (5 9--) of maximum incurred and paid claims. The indemnity coverage shall have basic plan features of $300.00 annual deductible and 80/20% co-insurance. The staff and consultant undertook a careful , independent analysis of the proposed programs, and the Harris Methodist Health Plan and Harris Methodist Select Plan are Printed on recycled paper , ... .. ..._. .....::,: ..,.,..:: __,....,:>z�..,__..u4..s..„�,.......,;..:......-... ,...:•;.,... �.«._,,. ,.,.., ,,..-.,....,.�,..,_..-......;,:.., " ate• .,.„,..s.:o.`= DATE PREFER N E NUHBE �� , �,L NA 'PAGE A�� 07_/09/...9.L__ �1 C. 1z9564_ =s _MARRII&: �,z 3 n h4�„ .- _ w. SUBJECT CIT:,("E�I POY�EE<HEALHT( tANfit � h�� `f!#1H1V' 1 iT 'PI.ANTIN. �" D/8/A HR�AIS METIODIST HLTHLA�F, SAN©xWI°`ElfiHHARt1VMETHIS1' SLL , _.INC�. ... .,.: +tzan:tvflewr.. ... ;: .._f s •_,.,,a-�r �a 't i .. p r zfr e s A X t.r"�"a'.Y 1 5., recommended by staff to provide-group:. health -.i nsurarrce..l� nefi s acid?related se w esk for -active-and retired employees and their spouses or­ dependents for the following, == _ � t reasons: , 1) A major portion of the City's liability is fully-insured with future years cosh increase guarantees which make this proposal slightly less costly over a two year period. 2) There is an extensive panel of physicians and facilities to serve the Tarrant County area and 18 area counties. . 3) The employee and retiree committees advising the City Manager overwhelmingly selected this finalist as the choice of the committee members. 4) Information received from the State Board of Insurance and contacts with local benefits managers where this program is offered provided positive responses regarding Harris Methodist Health Plan. Additional information and a plan design comparison among the three finalists is provided in ATTACHMENT 1. Each of the three proposed plans will maintain basically the current level of benefits with varying deductibles, maximum out-of-pocket expenses and charges; however, would require additional funds to finance the City's maximum liability for the forthcoming year. It is recommended that employees be assessed a portion of the cost for his/her own coverage regardless of the option selected. In the current year,, the employee selecting the Low HMO Option contributes nothing toward the cost of his/her own coverage. It is recommended that each Low Option employee pay $3.00 per pay period or $6.50 per month toward the cost of his/her own coverage for the Low Option Plan. Each high option employee would pay an additional $3.00 per pay period or $6.50 per month. The employee will pay no additional contribution above that paid in the Fiscal Year 1990--91 for his/her spouse or dependents. The City's contribution toward the cost of the .employee's' own coverage increaset`_by $6.50 per month for Low Option coverage,.by $10.90 per month for High Option coverage, and by $70.13 per month for those employees. elect .of the indemnity plan. The total cost, recommended employee/retiree contribution rate and City contribution' is illustrated on ATTACHMENTS 2 and 3. Funds in the amount of $22,254,708.00 to support' the estimated cost of the entire program wi 11 be i ncl uded i n the Ci ty Manager's recommended' budget for• Fi scail.t;Year 1991-1992. _. .. __.._ .. _ Prkad an c-s�_ +.,x,, '.`:: s ���ra.-a.+.{,x,�:..� {S��- ,�r: '�".e •-- o S. .s. X34..c+' �� s�-m i �F'.. Lam'` ri u .,. .: _ -w;+,•e [„^",.. -rir{?{^�— fir' } � r _......, t•-.,,,,, >r-a t �,».••,t.., t i -URN �. C _ - ,r .. `r•;���••<: _ '" !<�, ^•��m'�` �5. t I �'-s- «.,�•,. ....___ n.,•..v ,•..»_ Mr K:...gh,aPVaa i ...,..,-,w...y-•,,,-s+�v aar..nw ter. :�F,.-snve+wi�n +•.- ,sr,+ x S Fern FISCAL INFUBMAIOIV/GERIrON��€ �� � i r'Director:r: a st't 1S" 'i' •}} R? 1f att.'t,'i� '3. 'T'4 1 �x.fi :3�f t q d : w .E�"{'.�^Jw. A +:.+r-• �" The of Fi sea i Ser I ces cert�f�es 'tfiat_ tie money requl red=:.for the Fiscal Year-will be-`'included in the-City= Manager F s- proposed-:budgeo-yt:.# rN i 1,k A"�"' z..._•'_'1. 2 r';lr i'`- f�'r i .:. -r, 1 Gr'.. ''S r t. �,f i' f t` f'«� i'f^,; rr I { y 1 1 CD:t i ' :! r `S` ! , .c t4Yr c.._.1 ' h t ��4i' S ,� S ., :, ,�.!r 9' ..:-� :,.,., .�.;..�:• .. d j...tl: �e5 i=. - `?'!'t t _ .. ..�}� H t).t�-i ..,:SS <-. _, z E r7 s . " S _ •;. • s � c ti0� Su tte or C ty Manager's.. FUND ACCOUNT,, CENTER AMOUNT.. - CITY-SECRETARY.__;_ _ Office by: < to , .,. �/' E�MY r .' Charles Boswell 8500 Ori g i nat a ng-Vepartment Hea :. Susan Bulla 8513 (from) For Additional! Information. •..... r >. . . _ r i?Lrr� ' �t Contact: SUSdn Bul 1 a , 8513 City semoto_nl of the_ ---- Pfl"'01t f