Specific and Aggregate Stop Loss Insurance Renewal Copyright 2014
City of Dubuque Consent Items # 29.
ITEM TITLE: Specific and Aggregate Stop Loss Insurance Renewal
SUMMARY: City Manager recommending approval to accept the
proposal presented by AIG for Health and Prescription
Drug Plans -Specific and Aggregate Stop Loss Insurance
for the plan year beginning July 1, 2016, and ending June
30, 2017, and maintaining the current specific stop loss
amount.
SUGGESTED DISPOSITION: Suggested Disposition: Receive and File; Approve
ATTACHMENTS:
Description Type
Specific &Aggregate Stop Loss Renewal-MVM Memo City Manager Memo
Staff Memo Staff Memo
Spreadsheet Supporting Documentation
THE CITY OF Dubuque
UBE I
erica .i
Masterpiece on the Mississippi 2007-2012-2013
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 Plans
DATE: June 16, 2016
Personnel Manager Randy Peck recommends City Council approval to accept the
proposal presented by AIG for Health and Prescription Drug Plans-Specific and
Aggregate Stop Loss Insurance in the amount of $806,149 for the plan year beginning
July 1, 2016, with the specific stop loss remaining at our current rate of $120,0001. This
is a 27% increase over the current annual premium of$633,200.
All proposals included a specific stop loss amount for three large claims that range from
$150,000 to $3,000,000. Based on the potential worst case liability, AIG presented the
most competitive proposal. They will require a $1,000,000 stop loss amount for one
claim.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
Micliael C. Van Milligen
MCVM:jh
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
Teri Goodmann, Assistant City Manager
Randy Peck, Personnel Manager
THE CITY OF Dubuque
I-AmericaClty
Masterpiece on the Mississippi 2007-2012-2013
TO: Michael C. Van Milligen, City Manager
FROM: Randy Peck, Personnel Manager
SUBJECT: Specific and Aggregate Stop Loss Renewal — Health and Prescription
Drug Plans
DATE: June 15, 2016
Health Choices, Inc., our health plan administrator, obtained specific and aggregate
stop loss quotes from AIG, our current stop loss carrier and from Summit Re and HCC
Life. Following is a summary of the quotes with a specific stop loss of $120,000, which
is our current stop loss amount:
Proposal Premium Increase Aggregate Potential Worst Most Likely
Amount Case Liability Liability
AIG $806,149 27% $12,336,455 $1,806,149 $1,406,149
Summit Re $730,813 15% $12,763,777 $2,080,812 $1,360,813
Summit Re $120k
Aggregating Specific $610,817 -4% $12,763,777 $2,080,817 $1,240,817
HCC Life $633,876 0% $12,536,187 $3,633,876 $1,233,876
All proposals include a specific stop loss amount for three large claims that range from
$150,000 to $3,000,000. Based on the potential worst case liability, AIG presented the
most competitive proposal. They will require a $1,000,000 stop loss amount for one
claim. Their annual premium is $806,149, or a 27% increase over the current annual
premium of $633,200.
The requested action is for the City Council to pass a motion approving the renewal
proposal submitted by AIG effective July 1, 2016, for specific and aggregate stop loss
insurance for the City's health and prescription drug plan.
RP:Imh
•rt rCrrY'or: . Single 127
HEALTH CHOICES DUB E FamiTotal/ 452
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1l4nstcaf,�iece ora tJae Mississippi
Current.Stop Loss:,, Current^,Premiums +s
AIG Single Premium $40.43
$120,000 Specific Family Premium $99.77 7/1/2016 Stop-Loss Renewal
Unlimited Lifetime Agg $4.38
Unlimited Lifetime Total Stop Loss $633,200
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AIG
Current 24/12
Plan $633,200 $11,317,101
AIG 24/12
$806,149 27% $948,583 $12,336,455 $1,806,149 $1,406,149
Summit 24/12
Re $730,813 15% $873,247 $12,763,777 2,080,812' $1,360,813
Summit Re
$120k Agg 24/12
Spec $610,817 -4% $753,251 $12,763,777 2,080,817' $1,240,817
HCC Life 24/12
$633,876 0% $776,310 $12,536,187 $3,633,876 $1,233,876
Notes: Individual Specific Deductible amounts not included in Aggregate amounts
AIG:
All options have a $1,000,000 Individual Specific Deductible on Patient 1 -276/o increase
Summit Re:
All options have a $750K Traditional Individual Specific Deductible on Patient 1 & 12/12 Contract; $150k Traditional Individual Specific Deductible on Patient 2;
and a $270k Conditional Individual Specific Deductible on Patient 3, 15% premium increase
Option adding a $120k aggregating specific deductible including Individual Specific Deductibles and 12/12 contract provision -4% premium decrease
All pended claims for Patient 4 need to be paid before 7/1/16, otherwise they will be on a 12/12 contract
HCC Life:
$3,000,000 Individual Specific Deductible on Patient 1 -0% premium increase
Due to the 12/12 contract on Patient 1 the liability is an estimate