ORDER NO. 29505 AWARD BIDS FOR STOP LOSS INSURANCE COVERAGE FOR 2006 EMPLOYEE HEALTH BENEFITS PROGRAM Came to be heard this the 27th day of December, 2005, with a motion made by Commissioner Williams, seconded by Commissioner Baldwin. The Court unanimously approved by vote of 4-0-0 to: Accept bid from Mutual of Omaha for Stop Loss Insurance as presented by Mr. Looney, increasing the stop loss from $40,000 to $50,000, and accepting the current insurance premium funding for employees as presented on the attachment. agsos` COMMISSIONERS' COURT AGENDA REQUEST PLEASE FURNISH ONE ORIGINAL AND TEN COPIES OF THIS MADE BY: Pat Tinley OFFICE: County MEETING DATE: December 27, 2005 TIME PREFERRED: 9:15 SUBJECT: Consider, discuss and take appropriate action to Awazd Bids for Stop Loss Insurance coverage for 2006 Employee Health Benefits Program and establish premium rates for coverage under such program. EXECUTIVE SESSION REQUESTED: (PLEASE STATE REASON) NAME OF PERSON ADDRESSING THE COURT: County Judge/Gary Looney ESTIMATED LENGTH OF PRESENTATION: IF PERSONNEL MATTER -NAME OF EMPLOYEE: Time for submitting this request for Court to assure that the matter is posted in accordance with Title 5, Chapter 551 and 552, Government Code, is as follows: Meeting scheduled for Mondays: 5:00 P.M. previous Tuesday. THIS REQUEST RECEIVED BY: THIS REQUEST RECEIVED ON: All Agenda Requests will be screened by the County Judge's Office to determine if adequate information has been prepared for the Court's formal consideration and action at time of Court Meetings. Your cooperation will be appreciated and contribute towards your request being addressed at the eazliest opportunity. See Agenda Request Rules Adopted by Commissioners' Court. Gary R. Looney, REBC 3201 Cherry Ridge Drive /^, ~ /~ w Art Suite D 405 San Antonio, Texas 78230 INSURANCE GROUP, iNC. phone: (210) 930-6665 Fax: (210) 930-1838 Memorandum Date :December 24, 2005 TO :Kerr County Commissioners' Court From :Gary Looney Resc RE :Annual Renewal for Medical Plan - 2006 Pat Tinley County Judge H.A. "Buster" Baldwin Commissioner Precinct One William "Bill" Williams Commissioner Precinct Two Jonathan Letz Commissioner Precinct Three Dave Nicholson Commissioner Precinct Four Vendors were solicited for the stop loss insurance for the Kerr County medical plan administered by Mutual of Omaha. The County only received one proposal. Mutual of Omaha has offered a renewal for the current plan of benefits with two alternatives. I have attached a comparison of the current rating structure and the renewal options. To this point in 2005 the County has paid an estimated $135,000 in premium for specific and aggregate stop loss insurance. There have been six (6) claimants in excess of our deductible threshold of $40,000. Reimbursements are expected to be in excess of $367,000. Upon review of the losses incurred this year, the insurance industry did not consider the County to be a very strong potential client. I negotiated with Mutual of Omaha to provide us with specific stop loss insurance without any one individual being "lasered" (subject to a higher deductible) and a tighter corridor on the aggregate attachment point. I also requested a higher deductible for the Specific insurance coverage. I have attached a copy of a spreadsheet showing the results of the renewal negotiations. I have also attached a copy of the current and projected employee contribution rates for 2006. I recommend that the County move to a higher specific deductible, $50,000. I also recommend that the premium changes shown on the attached premium analysis be used for the employee contributions for 2006. I sincerely appreciate your confidence in my efforts to provide a financially 3zoi cherry Riage orme sound health insurance program for you and your employees. Swte 0405 San Antonio, Texos 78230 ~~~ V 2ID~930~6665 Gary R. Looney F 2109301638 Risk Management Consultant, REBC glooney@alamoinsgrp.com olamogrpC~3olomoinsgrp.mm County of Kerr Bid Spread Sheet TpA Mudd m OmNV BuNY of l7mNa YuNY MOmvAa Remsmana Cazrier Seery Fce': United OlpreAa Unted OFOnmlm Urltetl aOnvty Revewal Fee Aun-Iv/Run-Om: Adnivrisuation Fce Chmged by ®A(?) Pstanmed tu¢ out claim liabddty Spai6c l.ifetmre Mmavum Rewbmsemen[ Y ~•~ $ ~~ S ~'~ Aggnsge[e Ptav Year A®ual Maxvntmt Rreimbmxmm~t S 1,000,000 $ 1,000,000 S 7,000,000 PPO Network TTC TTC TTC 125%cmdtlor 115%caddcr 715%conidm ' No[e: These fees are one nme annual and are wt included m [omLs below. STOP-LOSS BASIS Numbs afEmployees: Phan! 254 254 254 Ntvebs of Spotval Uvib Nmnbs ofIlependem Units: m Children Number of Family Units Numbs ofEmployees: PIan2 Nsvnbs of Sposvel Umm Nwtber ofDepmdmt Units: or Childmv Ni>mber of Family Uvib Nsmtbs of P.mployces: PIan3 Numbs of Spousal Units Nwtber of Dependent Uttits: or Children Nmnber ofFmmly Uttita Specific Deductible: $ 40,000 S 40,000 S 50,000 Specific Covhacc 15112 75172 15(72 Specific Conuac[ Guluds MedwlB Rx Medcal 8 Rz Medd & fG Aggegete Contract 15!12 15112 1k12 Mmtmnmt Aggregate Rmt In to Co~aa Ivcludm MedrA B We Medal & Rx Medical Olbc MON'Fffi.Y F77r~D COSTS Specifie Prtmivm Composite: $ 4407 S 7684 $ 63.19 AllBagate Premium Cavryosite' $ 4.11 Y 1234 S 12.34 Mthly Cep Admiviatradov( all teen per uvit per mouth) Cle®s CostPs Employee Composie nits $ 76.32 $ 2147 $ 25.05 Disease M®agement Optson 1 Y 191 S 2.01 Y 201 Medical Marugentent Fes / Utilvution Review S 2.40 Y 2.95 $ 295 PPO Netwotk A¢eu Fees S 2.49 S 261 S 2.61 HRA admen fea Y 3.50 S 350 Y 358 1'PO Netwmk Out oEArea mnetwork fre Na rJa Na Rz Pmgmm Fees N Web Hosed Access Yes Yes Vas COBRA $ 0.50 S 0.50 S 0.50 HIppA $ (1.30 Y 0.30 S 0.30 Positive Pay Banking System TotalPs Employee: 3 27.50 $ 33.42 $ 37.00 AGGREGATE FACTORS Composim. 4 52744 S 488.49 S 505.98 Moodily 3 133,969 S 114,076 $ 128,519 Animal: S 1,607,625 S 1,480,910 S 1542,227 TOTAL AC1NI)AL COSTS Specific Stop Lou Pretrmvn S 734,325 S 274,208 $ 192,603 A(~egate S[ap Lou Premnnv S 13,137 Y 77,672 $ 37,672 Admiws[mtion-COBRA B@AA PIRA Admire S fi3,094 Y 78,797 $ 89,703 UR, PPO, Rz $ 14,905 $ 16,947 S 7Q997 Diseue Management $ 5,822 $ 8,126 S 6,126 Tofal Fixed $ 237,282 $ 373,605 $ 342,997 Fsxpecled Claims Cost excludng Feed Cost $ 1,205,719 S 1,265,580 $ 1,370,893 Mmthamn Claims Costs excluding Faed Cast $ i,fi07,625 S 1,480,978 $ 1,542,227 Expected Claims Cast including Fvted Cole S 1,437,001 S 1,639,2fi5 $ 1,653,884 Ma~dmmn Claims COah mcludivg Feed Cost S 1,870,907 S 1,082,602 S 7,885,278 Estimvtcd NRA Livbiiity $ 200,000 $ 700,000 $ 300,000 EsamaMa iota! Liability FUnatag $ __ 2,038,907 $ 2,162,602 $ 2,785,218 Kerr County Current Insurance Premium Funding Plan Plan A EE Plan A Child(ren) Plan A Spouse Plan A Family Plan B EE Plan B Child(ren) Plan B Spouse Plan B Family Total Number of employees December 22, 2006 File: Kerr County Rate Projections for 2006 Gary Looney, nEec 2004-2005 Mo Prem No of Emp Total Mo Prem $ 505.00 206 $ 104,030 $ 184.50 22 $ 3,619 $ 271.62 11 $ 2,968 $ 385.96 16 $ 6,175 Monthly $ 116,812 Annually $ 1,401,746 $ 412.00 48 $ 19,776 $ 93.00 $ 4,464) $ 105.00 1 $ 105 $ 141.14 1 $ 141 $ 239.34 1 $ 239 Monthly $ 15,797 Annually $ 189,570 Annual Funding $ 1,591,316 254 Projected Rates for 2006 2005-2006 Mo Prem Total Mo Prem $ 561.00 $ 143,055 $ 187.00 $ 3,674 $ 276.60 $ 3,036 $ 400.00 $ 6,400 $ 156,165 $ 1,673,980 County Paid $ 561.00 ~ $ 26,050 $ 60.00 $ 2,680 $ 110.00 $ 110 $ 171.00 $ 171 $ 269.00 $ 269 $ 25,720 $ 308,640 County Funding EE Paid Mutual of Omaha Medical Large Claim Summary (BIM0022) G000487A Kerr County Claims Paid: 01/01/2005 to 01l01I2008 Claim Threshold: 40000 Subgrou All) Class All) Plan All) Product All) Relationshi Member Data De ndent Subscriber Grand Total 45205351 Medical Paid $230,314.27 $230,314.27 Drug Paid $443.64 $443.64 Med & Dru Paid $230,757.91 $230,757.91 45213502 Medical Paid $124,388.32 $124,388.32 Drug Paid $553.78 $553.78 Med & Dru Paid $124,942.10 $124,942.10 45211601 Medical Paid $85,152.32 $85,152.32 Drug Paid $55.87 $55.87 Med & Dm Paid $85,208.19 $85,208.19 45235951 Medical Paid $76,149.89 $76,149.89 Drug Paid $910.96 $910.96 Med 8 Dru Paid $77,060.85 $77,060.85 45214202 Medical Paid $47,580.03 $47,580.03 Drug Paid $1,493.87 $1,493.87 Med & Dru Paid $49,073.90 $49,073.90 45218901 Medical Paid $39,139.22 $39,139.22 Drug Paid $1,547.11 $1,547.11 Med 8 Drug Paid $40,686.33 $40,686.33 Total Medical Paid $171,968.35 $430,755.70 $602,724.05 Total Dru Paid $2,047.65 $2,957.58 $5,005.23 Total Med & Dru Paid $174,016.00 $433,713.28 $607,729.28 Medical Disposition of Total Charges Run Date: 12!0612005 G00O487A -Kerr County Claims PAID From: 01/0112 0 0 5 m teL~Um~a Ml Claims PAID To: 1113012005 "Total" In Network Out of Network Total Total Charges $1,982,795. 54 5228,086. 90 $2,210,882.44 Claim Processing Reductions Non-Covered Members $503. 00 $85,937. 50 $86,440.50 Non-Covered Services $9,951. 79 $923. 80 $10,875.59 Maximum Benefit Met $5,012. 12 $164. 45 $5,176.57 Precert/Documentation Penalty $12,839 OB $245. 80 $13,084.88 Utilization Management $448. 00 $368. 62 $816.62 Clinical Edit $12 710. 72 $588. 77 $13,299 49 Provider Medicare/Coverage Reductions $91,663. 24 $4,111. 27 $95,774.51 COB Payments $239,882. 64 $1 291 48 $241,174.12 Other $0. 00 $0. 00 $0.00 Total Claim Processing Reductions $373,010. 59 $93,631 .69 $466,642.28 Charges Less Claim Processing Reductions $1,609,784. 95 $134,455 .21 $1,744,240.16 Pricing Reductions $384,014. 97 $4,260 .92 $388,275.89 Allowed $1,225,769. 98 $130,194 .29 51,355,964.27 Employee Share Deductibles $124,106 40 $40,585.05 $164,691 45 Copays $43,259.78 $0.00 $43,259.78 Coinsurance $52,952.27 $22,910.56 $75,862.83 Total Employee Share 5220,316.45 $63,495.61 5283,814.06 Plan Payments $1,005,451.53 $66,698.68 $1,072,150.21 Key Ratios Employee Share Ratio (Employee Share/Allowed) 17.97 % 48.77 % 20.93 Plan Ratio (Plan Payments/Allowed) 82.03 % 51.23 % 79.07 Adequacy Ratio (Paymenlsffotal Charges) 50 71 % 29.24 % 48.49% Prescription Drug Plan Payments 5240,016.64 50.00 8240,016.64 Total Plan Payments 51,245,468.17 566,698.68 51,312,166.65 --5~~I77J~ Footnote: Report information is drawn from administrative sources only The fnancial perspective for the same reporting period can vary significantly. Using This report as a substitute for or in comparison to financial reporting is invalid. Repod q BIM0001 Page 4 of 4 BIM Data Management and Repoding Medical Disposition of Total Charges Run Date: 1210612005 G000487A -Kerr County Claims PAID From: 01/0112 0 0 5 Mtmux~Uoaxa Claims PAID To: 11!30/2005 PLAN In Network Oul of Network Total Total Charges $0.00 $0.00 $0.00 Claim Processing Reductions Non-Covered Members $0.00 $0.00 $U.00 Non-Covered Services $0.00 $0.00 $0.00 Maximum Benefit Met $0.00 $0.00 $0.00 PrecerUDocumentalion Penalty $0.00 $0.00 $0.00 Utilization Management $0.00 $0.00 $0.00 Clinical Edit $0 00 $0.00 $0.00 Provider Medicare/Coverage Reductions $0.00 $0 00 $0.00 COB Payments $0.00 $0.00 $0.00 Other $0.00 $0.00 $0.00 Total Claim Processing Reductions $0.00 $0.00 $0.00 Charges Less Claim Processing Reductions $0.00 $0.00 $0.00 Pricing Reductions $0.00 $0.00 $0.00 Allowed $0.00 $0.00 $0.00 Employee Share Deductibles $0.00 $0.00 $0.00 Copays $0.00 $0.00 $0.00 Coinsurance $0.00 $0.00 $0.00 Total Employee Share 80.00 $0.00 50.00 Plan Payments 50.00 $0.00 $0.00 Key Ratios Employee Share Ratio (Employee SharelAllowed) #Num! #Num! #Num! Plan Ratio (Plan Payments/Allowed) #Num! #Num! #Num! Adequacy Ratio (PaymenlslTotal Charges) 0.00 % 0.00 % 0.00 Prescription Orug Plan Payments 86,633.22 $0.00 56,633.22 Total Plan Payments $6,633.22 50.00 $6,633.22 Foolnole: Report information is drawn from administrative sources only The financial perspective for the same reporting period can vary significantly Using This repod as a substitute for or in comparison to financial repoding is invalid. Report #~ BIM0001 Page 1 of 4 BIM Dala Management and Repoding Medical Disposition of Total Charges Run Date: 12!06/2005 GOO0487A -Ken' County Claims PAID From: 01101/2 0 0 5 ' Mt7r1wL~Otnaxa Claims PAID To: 11130/2005 PLAN In Network Ouf of Network Total MEDCPP01 Total Charges $1,791,082.37 ;70,924.49 $1,962,006.86 Claim Processing Reductions Non-Covered Members $503.00 $0.00 $503.00 Non-Covered Services $8,905.60 $611.99 $9,517.59 Maximum Benefit Met $4,857.69 $25.00 $4,876.69 PreceNDocumentation Penally $10,817.72 $245.80 $11,063.52 Utilization Management $448.00 $368.62 $816.62 Clinical Edit $10,066.26 $417 00 $10,477.26 Provider Medicare/Coverage Reductions $91,663.24 $4,111.27 $95,774.51 COB Payments $239,882.64 $1,291.48 $247,174.12 Other $0.00 $0.00 $0 00 Total Claim Processing Reductions $367,138.15 $7,065.16 $374,203.31 Charges Less Claim Processing Reductions $1,423.944.22 $63,859.33 $7,487,803.55 Pricing Reductions $321,033.15 $3,074.88 $324,108.03 Allowed $1,102,911.07 $60,764.45 $1,163,695.52 Employee Share Deductibles $100,592.97 $28,421.99 $129,014.96 Copays $37,423.71 $0.00 $37,423.17 Coinsurance $39,641.53 $6,798.78 $46,440.31 Total Employee Share $777,657.81 $35,220.77 $212,878.38 Plan Payments $925,253.46 $25,563.68 $$50,817.74 Key Ratios Employee Share Ratio (Employee Share/Allowed) 16.11 % 57.94 % 18 29 Plan Ratio (Plan Payments/Allowed) 83.89% 42.06% 87,77% Adequacy Ratio (Payments/Total Charges) 51.66 % 36.04 % 51.06 Prescription Drug Plan Payments $217,799.47 $0.00 $217,799.41 Total Plan Payments $1,143,052.87 $25,563.68 $1,168,616.55 Footnote Report information is drawn from administrative sources only. The financial perspective for the same repoAing period can vary significantly. Using this report as a subslilule (or or in comparison to financial reporting is invalid. Report #~ BfM0001 Page 2 of 4 BIM Data Management and Reponing Medical Disposition of Total Charges Run Date: 1 210612 0 0 5 G00O487A -Kerr County Claims PAID From: 01101/2 0 0 5 Mtnurg~Omaaa Claims PAID To: 1113012005 PLAN In Network Out of Network Total MEDPPO01 Total Charges $191,713.17 $157,162.41 $348,875.58 Claim Processing Reductions Non-Covered Members $0. 00 $85,937. 50 $85,937.50 Non-Covered Services $1,046. 19 $311. 87 $1,358.00 Maximum Benefit Mel $160. 43 $139. 45 $299.88 Precert/Documentation Penalty $2,021. 36 $0 .00 $2,021.36 Utilization Management $0. 00 $0 .00 $0.00 Clinical Edit $2,644. 46 $177 .77 $2,822.23 Provider Medicare/Coverage Reductions $0. 00 $0 .00 $0.00 COB Payments $0. 00 $0 .00 $0.00 Other $0. 00 $0 00 $0.00 Total Ctaim Processing Reductions $5,872 .44 $86,566 .53 $92,438.97 Charges Less Claim Processing Reductions $185,840 .73 $70,595 .88 $256,436.61 Pricing Reductions $62,981 .82 $1,186 .04 $64,167.86 Allowed $722,858 .97 $69,409 .84 $792,268.75 Employee Share Deductibles $23,573.43 $12,163 O6 $35,676.49 Copays $5,836.67 $0.00 $5,836.67 Coinsurance $13,310.74 $16,111.78 $29.422.52 Total Employee Share $42,660.84 528,274.84 $70,935.68 Plan Payments $80,198.07 $41,135.00 $121,333.07 Key Ratios Employee Share Ratio (Employee SharelAllowed) 34.72 % 40.74 % 36.89 Plan Ratio (Plan PaymenlslAllowed) 65.28 % 59.26 % 63.11 Adequacy Ratio (PaymentslTotal Charges) 41.83 % 26.17 % 34 78 Prescription Drug Plan Payments $15,584.01 $0.00 $15,564.01 Total Plan Payments 595,782.08 $41,135.00 $136,917.08 Footnote: Report information is drawn from administrative sources only The fnancial perspective for the same reporting period can vary signi0cantly Using Ihis report as a substitute for or in comparison to financial reporting is invalid. Repod q' BIM0001 Page 3 of 4 ~ BIM Data Management and Reporting KERR COUNTY 33520.2672 ACTIVITY REPORT BRANCH: A001 PERIOD:01/01/200.5 to 09/30/2005 HEALTH REIMBURSEMENT 2 -MEDICAL 436 2 - PERSCRIPTIONS 7~` DCC it REPORT PERIOO DISBURSEMENTS 1189 $85,729.23 REPORT PERIOD DEPOSITS 0 ~~~ REPORT PERIOD REVERSALS 0 ~~~ REPORT PERIOD ER DEPOSITS 0 ~~~ TOTAL VOIDED CHECKS 0 $0.00 TOTAL EMPLOYEES 231 YEAR TO DATE DISBURSEMENTS 1219 $87,062.07 YEAR TO DATE DEPOSITS 0 ~~~ YEAR TO DATE REVERSALS 0 $0.00 TOTAL ANNUAL BENEFIT AMOUNT $202,850.00 YEAR TO DATE ENDING BALANCE $135,787.93 BRANCH : R001 PERIOD : 01/01!2005 to 09/30/2005 HEALTH REIMBURSEMENT 2 -MEDICAL 1 2 - PERSCRIPTIONS ~ REPORT PERIOD DISBURSEMENTS 69 $3.300.30 REPORT PERIOD DEPOSITS 0 $0.00 REPORT PERIOD REVERSALS 0 $0.00 REPORT PERIOD ER DEPOSITS 0 $0.00 TOTAL VOIDED CHECKS 0 ~~~ TOTAL EMPLOYEES 11 YEAR TO DATE DISBURSEMENTS 70 $3,400.30 YEAR TO DATE DEPOSITS 0 ~~~ YEAR TO DATE REVERSALS 0 ~~~ TOTAL ANNUAL BENEFIT AMOUNT $7,800.00 YEAR TO DATE ENDING BALANCE $4,399.70 KERR COUNTY 33520-2672 ACTIVITY REPORT BRANCH : FULL PERIOD :01/01/2005 to 09!30/2005 HEALTH REIMBURSEMENT 2 -MEDICAL 437 2 - PERSCRIPTIONS 833 DCC 11 REPORT PERIOD DISBURSEMENTS 1258 $69,119.53 REPORT PERIOD DEPOSITS 0 ~~~ REPORT PERIOD REVERSALS 0 $0.00 REPORT PERIOD ER DEPOSITS 0 $0.00 TOTAL VOIDED CHECKS 0 ~~~ TOTAL EMPLOYEES 242 YEAR TO DATE DISBURSEMENTS 1289 $70,482.37 YEAR TO DATE DEPOSITS 0 $0.00 YEAR TO DATE REVERSALS 0 $0.00 TOTAL ANNUAL BENEFIT AMOUNT .$210,650.00 YEAR TO DATE ENDING BALANCE $140,187.83