Specific and Aggregate Stop-Loss Renewal_Health and Prescription DrugMasterpiece on the Mississippi
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: Specific and Aggregate Stop -Loss Renewal - Health and Prescription Drug
Insurance Plans
DATE: June 14, 2011
The Health Care Committee recommends City Council approval of the renewal rate of
$583,147 submitted by HM Life for Specific and Aggregate Stop -Loss Renewal for the
City's Health and Prescription Drug Insurance Plans. The cost of this policy is $76,490
higher than the current stop loss premium of $506,657. This policy provides a
$5,000,000 annual limit and specific deductible of $100,000. The previous policy had a
$2,000,000 annual limit and specific deductible of $90,000. These changes will protect
the City in the event of a catastrophic claim. The policy would be effective July 1, 2011.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
MCVM:jh
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
Randy Peck, Personnel Manager
Michael C. Van Milligen
Dubuque
bitIA
111- Amedcacity
III I,
2007
Masterpiece on the Mississippi
DATE: June 8, 2011
Dubuque
AO- America City
2007
TO: Michael C. Van Milligen, City Manager
FROM: Randy Peck, Personnel Manager
SUBJECT: Specific and Aggregate Stop -Loss Renewal - Health and Prescription Drug
Insurance Plans
On June 7, 2011, the Health Care committee met to discuss the specific and aggregate
stop loss renewals proposals. The Health Care Committee recommends that we
increase the annual limit from $2,000,000 to $5,000,000, in the event of a catastrophic
claim. In addition, and in order to reduce the increase in cost, the Health Care
Committee recommends that we increase the current specific stop loss amount from
$90,000 to $100,000. This year we had seven claims that exceeded the specific stop -
loss amount of $90,000. In Fiscal Year 2010, three claims exceeded the specific stop -
loss amount and in Fiscal Year 2009, two claims exceeded the specific stop -loss
amount. As of May 31, 2011, our stop -loss carrier has reimbursed the City $497,524.
Our premium for Fiscal Year 2011 is $506,657.
Health Choices, Inc, our health plan administrator, obtained specific and aggregate
stop -loss quotes from American National Life of Texas, our current stop -loss carrier,
and from six other stop -loss carriers. The other stop -loss carriers are Imperium
Insurance Company, HM Life, QBE Insurance, Companion Life, Perico Life and Perico
Life - Aggregating. Our current carrier would not provide a quote for a specific stop -loss
amount of less than $115,000. In addition, they would require a specific stop -loss
amount of between $225,000 to $350,000 for one of the existing large claims.
HM Life is the only company that provided a quote for a $5,000,000 annual limit and a
specific deductible of $100,000, without requiring a specific stop loss amount for any of
the existing large claims. The quote is $583,147.
The Health Care Committee recommends that we accept the proposal submitted by HM
Life in the amount of $583,147 for a policy that provides a $5,000,000 annual limit and a
specific deductible of $100,000. Their quote is $76,490 higher than the current stop
loss premium of $506,657. Coverage would go into effect on July 1, 2011.
The requested action is for the City Council to pass a motion approving the renewal rate
submitted by HM Life effective July 1, 2011 for a policy that provides a $5,000,000
annual limit and specific stop -loss amount of $100,000 for the City's health and
prescription drug plan. Health Choices, Inc has obtained a binder to make sure there
would not be a lapse in coverage on July 1, 2011.
RP:jmh
Single Enrollment
117
Contract
Maximum
Specific
$90,000
Deductible
$95,000
S ific Deductible
$100,000
S ific Deductible
$115,000
Specific Deductible
$125,000
S�ecific Deductible
S
P I 1 e �Annual
$150,000
Mc Deductible
$200,000
S Mc Deductible
Family Enrollment
422
Total
539
Stoploss
Premium
Annual
Fixed Costs
Attachment
Point
Stoploss
Premium
IP
Annual
Fixed Costs
Attachment
Point
Ip�
Stoploss Annual
Premium Fixed Costs
Attachment
Point
Stoploss
Premium
Annual
Fixed
Costs
Attachment
Point
Stoploss
Premium
I Annual
Fixed
Costs
Attachment
Point
Stoploss
Premium
Fixed
Costs
Attachment
Point
Stoptoss
Premium
I 1 � c Annual
Fixed
Costs
Attachment
Point
Carrier
American National Life of
To
Incumbent
24/12
$2 Million Lifetime
Max
$506,657
5635,370
57985
American National Life of
To
Laser 1 $225k or $350k
depending on tx.
Renewal
24/12
$2 Million Die,
Max
$529,090
$657,803
$8,238,661
$500,045
$628,758
$8,054,916
$437,010
$566723
$8,456,291
$310,895
$439,608
$8,569,103
American National Life of
Tx
Laser. 1 $225k or 03506
depending on ❑.
Renewal
24/12
55 Million
Annual /Untimit, -.:
Lifetime
$513,878
$642,591
$8,363,410
$441,020
$569,733
$8,456,291
$314,905
$443,618
$8,569,103
American National Life of
Tx
Laser 1 E225k 015350k
depending on tx.
Renewal
24/12
$ 2 Million
Annual /Unlirnlr,
Lifetime
5517 371
$646,084
58,363,410
0444,513
$573.226
$8,456,291
$318.449
5447 162
$8.569 103
Mast Complet .s Proposal
Imperium Insurance Company
Laser 1 $250,000 2
$150,000 if chemo starts
3'$200,000
24/12
Unlimited Lifetime
Max
$621,181
$749,894
$8,875,962
$600,575
$729,288
$8,964,702
$575,685
$704,398
$9,054,358
$518,259
$646,972
$9,507,059
HM Life
24/12
$2 Million
Annual /Unlimited
Lifetime
$635,637
$764,351
$8,370,974
$606,242
$734,955
$8,429,553
$575,398
$704,111
$8,488,183
$431.035
$599,748
$8,739,294
HM Life
24/12
$5 Million
Annual /Unlimited
Lifetime
$643,452
$772,165
$8,370,974
$613,955
$742,668
$8,429,553
$583,147
$711,861
$8,488,183
$438,351
$567,064
$8,739,294
HM Life
24/12
Unlimited Lifetime
Max
$646,762
$775,476
$8,370,974
$617,367
$746,080
$8,429,553
$586,458
$715,171
$8,488,183
$441,381
$570,094
$8,739,294
OBE Insurance
24/12
$2 Million
Annual /Unlimited
Lifetime
$657
$786,520
$8
$627
$756,010
58,658
$577,590
$706,304
$8,709,945
Non -Compe0tive or Preliminary
Proposals
24/12
55 Million Lifetim
$775,852
$904,565
$8,156,941
$740,513
$869,226
$8,182,967
$686,280
$814,993
$8,209,160
C2panion Life
Penco Life
24/12
$2 Million Annual
Max
$1,270,660
$1,399,374
$8,266,837
$1,210,095
$1,338,808
$8,339,682
$1,097,637
$1,226,350
$8,415,380
Perico Life-Aggregating Spec
24/12
$2 Million Annual
Max
$450,000 Aggregate Spec
$430,000 Aggregatf Spec
$390,000 Aggregat ng Spec
$730,080 $858,793 $6,266,837
$693,555 $822,268 $8,339,682
$692,157 $757,871 $8,415,380
PERU
Declined to quote - uncompetitive
Medical Excess
Spectrum
OptumHeaoh
IISI
City of Dubuque
Market Search Summa
Jhayes Preferred Health Choices, LLC 6/6/11