Health Ins. Admin. Fee increase
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MEMORANDUM
June 14, 2004
TO:
The Honorable Mayor and City Council Members
FROM:
Michael C. Van Milligen, City Manager
SUBJECT: Health Choices Administrative Services Fee for the City's Health
Insurance Plan
Personnel Manager Randy Peck is recommending approval of the administrative
services fee presented by Health Choices of $16.50 per contract per month effective
May 1, 2004 through June 30, 2006.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
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Michael C. Van Milligen
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Attachment
cc: Barry Lindahl, Corporation Counsel
Cindy Steinhauser, Assistant City Manager
Randy Peck, Personnel Manager
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CITY OF DUBUQUE, IOWA
MEMORANDUM
June 2, 2004
TO:
FROM:
Michael C. Van Milligen
City Manager
Randy Peck ~
Personnel Manager
SUBJECT: Health Choices Administrative Services Fee for the City's Health
Insurance Plan
I received the renewal request from Health Choices regarding their administrative
services fee. Health Choices is requesting that their administrative services fee be increased
from $15.75 per contract per month to $16.50 per contract per month or a 4.8% increase. The
new fee is in effect from May 1, 2004 through June 30, 2006. Under our current agreement, the
$15.75 per contract per month fee is guaranteed through June 30, 2004. Health Choices has
requested that the new rate go into effect on May 1, 2004 as this is the date they began the
administration of the Point-of-Service Plan, which means they are now administering three
plans. They will continue to administer the HMO and Indemnity Plans until changes are made
to the health insurance program for employees covered by the Police bargaining Unit.
The Fiscal Year 2005 budgeted amount for the administrative services fee is $16.54 per
contract per month or a 5% increase. Bill Robinson of Gallagher Benefit Services has reviewed
the renewal request and recommends that we accept the proposed increase in the
administrative services fee. The Health Care Committee has also approved the proposed
increase in the administrative services fee. Sufficient funds are available in the health insurance
reserve to finance the increase through the remainder of Fiscal Year 2004.
I recommend that we approve the administrative services fee presented by Health
Choices of $16.50 per contract per month effective May 1,2004 through June 30, 2006.
The requested action is for the City Council to approve a motion approving the
administrative services fee presented by Health Choices of $16.50 per contract per month
effective May 1, 2004 through June 30, 2006.
Health Choices has prepared a new Administrative Services Agreement. Corporation
Counsel Barry Lindahl and I are reviewing the terms of the proposed agreement and will be
submitting it to you for approval as soon as we complete our review.
If you have any questions, please feel free to call.
RP:bf
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Attachment D
Compensation to Health Choices
Purchaser shall pay Health Choices on the first day of each month the following amounts per Covered Person
per month for its Administrative Services and Provider Contracting Services under this Agreement during each
such month:
1. Administrative Services (as described in Section 1.1) and Provider Contracting Services (as described
in Section 1.2) $16.50 oer emolovee oer month.
2. The rate is guaranteed until June 30, 2006 or until the City of Dubuque seeks competitive quotes,
whichever occurs first.
Exceptions and Additions:
There shall be periodic retroactive and prospective adjustments to the above payments to reflect the actual
number of Covered Person per month and portions thereof.
Admio"UaIive Sen<œs Ago'eement.PPO