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Health Ins. Admin. Fee increase Dm~E ~Yk~ 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. fYtJi~~ Michael C. Van Milligen MCVM/jh Attachment cc: Barry Lindahl, Corporation Counsel Cindy Steinhauser, Assistant City Manager Randy Peck, Personnel Manager C) ,:7" U1 -,. "" ..- - 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 ., 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