Title
Selection of Blue Cross Blue Shield of Florida, Inc. as the provider of Specific Stop-Loss Carrier for the City Group Health Plan (B)
This item involves a request for the City Commission to approve the rankings and selection of Blue Cross Blue Shield of Florida, Inc. as the provider through their subsidiary, High Mark Insurance, of specific stop-loss insurance for the City’s Group Health Plan.
Explanation
The City maintains a self-funded health plan for its employees, retirees and their family members. The health plan utilizes a risk transfer tool to mitigate the impact of large claims. Specific Stop-Loss insurance is the risk transfer tool that the group health plan utilizes to cover the cost of large claims. Under a specific stop-loss policy, the City’s group health plan is responsible only for a fixed dollar amount of a covered members annual claims costs, after that specified amount has been paid, all subsequent claims costs are reimbursed to the City.
Recently, the City conducted a comprehensive Invitation to Bid (ITB) process to select a carrier to provide specific stop-loss coverage for the City’s group health plan. In response to the ITB, the City received responses from four carriers or their representatives providing for over sixteen different coverage options. The bids were evaluated on price, coverage, past performance and financial stability. Both prices and policy forms varied greatly with the broadest coverage options having the highest cost and the narrower policy forms providing the most favorable pricing. There were three different policy forms offered by the various bidders. They are differentiated by when a claim had to be incurred and when the claim had to be paid. A summary of the submissions and cost associated with each is included in the backup.
The best coverage form would be a paid contract basis. This is the coverage form the City currently utilizes but it is increasingly becoming less affordable. Under a paid c...
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