Lake City KO's Big Blue and goes with United Health Care and FMIT - almost
Posted August 7, 2012 09:05 am
LAKE CITY, FL – With health care costs taking bigger and bigger chunks out of local municipal budgets, City Manager Wendell Johnson and his staff worked hard to save the City money on this coming year's health insurance premium. In what may become an instant replay of 2010, the City Manager's team reached out to the League of Cities Florida Municipal Insurance Trust (FMIT) for a quote. The City Manager sabotaged himself and the hard work of the staff by supplying no supporting information on which the Council could base a decision.
Gene
Bullard, Lake City’s HR Director, explained to the City
Council that a few months ago the Parks Johnson Agency
advised the City that it could expect a 20% increase in
rates. Parks Johnson represents Blue Cross/Blue Shield,
the City’s current provider.
The City then went out for proposals and according to Mr. Bullard, received four responses. The City formed a committee and ranked the proposals. Mr. Bullard told the Council that FMIT/United Health Care came out on top.
It is unknown who was on the committee and the order of ranking, as the only material supplied to the City Council by the City staff was the resolution to support the change over from Blue Cross/Blue Shield (BC/BS) to FMIT/United Health Care. There was a spread sheet distributed at the last minute to the Council, however, without any other information, the spread sheet was relatively useless.
FMIT's Clay Austin knew he was coming back to Lake City.
Mr. Bullard explained that unlike years ago, United Health Care is now accepted by all the doctors and hospitals in the region.
City Manager Johnson asked Mr. Bullard to summarize the difference between the City's current BC/BS plan and the proposed United Health Care plan. Once again, there was no documentation for the Council to view.
Mr. Bullard explained that the City would be saving about $100,000 in premiums and the employees would have lower deductibles with the base plan. The City would be buying three separate plans. Again, there was no backup documentation.
"The rates are significantly different for this plan of United Health Care vs. staying with the same vendor we have now... United has more advantages than what Blue Cross has," Mr. Bullard told the Council.
The contribution rate is 75-25. The City pays 75% and the employee pays 25% of the health care premium.
Mr. Bullard explained that for years there was no rhyme or reason for the difference in the City/employee percentage of contribution rate, which favored single employees over families. He said with the new plan this would be a thing of the past.
"It will always be a 75/25 split from now on," he said.
The proposed annual cost of health coverage is $1,836,546, with the City's (the taxpayer's) contribution being $1,377,409.50 and the employees making up the difference.
A lot to digest
Councilwoman Moses was not happy with the information
she received.
Councilwoman Melinda Moses told the Council, "This is a lot to digest." She recommended waiting two weeks so the Council could look over the information.
City Manager Johnson explained that besides the purported $100,000 savings, the City would also save $60,000 in broker's commission.
Councilwoman Moses, "If I'm going to vote on this, I want to make sure that I've looked over the information and make the best decision for our employees."
The Council tabled its decision to August 20th, its next regularly scheduled meeting.
Epilogue
While the FMIT/United Health Care plan may be the best plan giving the City the best bang for the buck, the City was derelict in supplying the information the Council needed to make an informed decision.
The City gave up no information other than a resolution to give the almost two million dollars of business to United Health Care.
In today's technological age it is inexcusable that the City Management didn't give up a shred of information in its agenda packet which was distributed last Friday.
