07-21-2015 Regular School Board Meeting
Agenda Item #33


Title
Employee Medical and Pharmacy Third Party Administrative Services Agreement

Discussion

The Office of Employee Benefits and Risk Management requested that the Office of Purchasing and Warehouse Services post a solicitation and facilitate a proper bid as outlined in Florida Administrative Code for Third-Party Administrative Services for employee medical care and pharmacy as our existing contract with CIGNA Health and Life Insurance Company (CHLIC) expires on December 31, 2015.  The Office of Employee Benefits and Risk Management along with the district’s consultant for employee health benefits Willis Consulting developed the specifications for the bid and selected knowledgeable staff and representatives made up of the Brevard Federation of Teachers and 1010 union representatives to be a part of the selection committee.  The Office of Purchasing and Warehouse Services facilitated the bid and would normally have provided the finalist to the Board under their agenda, but at the request of Associate Superintendent of Financial Service, the Office of Employee Benefits and Risk Management was asked to present the results to the Board directly.  Had the agenda item gone under the Office of Purchasing and Warehouse Services the agenda item would have stated the following:    

Purchasing issued the first RFP for these as follows:
RFP #15-P-052-EP – Group Medical Insurance and Pharmacy Benefits Management Services
Date Solicited:  March 4, 2015   
Date Opened:  April 20, 2015
No. Firms Solicited:         458        
No. Firms Bidding:           11
Recommendation
The purpose of this Request for Proposal (RFP) was to solicit competitive sealed proposals for Group Medical Insurance and Pharmacy Benefits Management Services effective January 1, 2016 for Brevard Public Schools.  It was the recommendation of the proposal evaluation committee to contract with the top-ranked firm, Cigna Health and Life Insurance Company.  It is the recommendation of Debra Pace, Associate Superintendent of Humany Resources, Mark Langdorf, Director of Employee Benefits and Risk Management, and staff to approve the attached agreement.  This agreement has been reviewed and approved by the School Board Attorney.  Due to the large size of the documents, Exhibits to the attached agreement are available for review by appointment in the Office of Purchasing Services.

We attest that the bid was properly performed and in accordance with Board Policy, Florida Statute, and Administrative rule.  The Office of Employee Benefits and Risk Management are currently in the process of negotiating the final language for pricing for the final contract.  The attached “sample Administrative Services Only (ASO)” agreement has the same wording  the final Brevard Public Schools contract will have.  As soon as the final contract is complete and approved by the department and the School Board’s attorney it will be provided to the Board for review prior to the consent agenda set for August 11, 2015.

The new contract has several enhancements including a reduction in fees for services rendered.  The following is a short list of enhancements that Cigna offered to the Request for Proposal committee during their best and final presentation:
1. Cigna will continue to provide a full-time on-site Health and Wellness Coach throughout the duration of our contract.
2. Cigna is offering a 5-year fee guarantee with a reduction of -$4.85 Per Employee Per Month (PEPM) + $1.00 PEPM extra reduction from current ASO fees if both Brevard Schools and Brevard Board of County Commissioners (BOCC) remain with Cigna (BOCC recently voted to also remain with Cigna and is awaiting BOCC  approval in August 2015).  If Cigna successfully retains both Brevard Schools and BOCC for 2016 forward, they will implement these lower fees beginning 10/1/15 thereby saving our current plan year additional costs.
3. Cigna will continue to offer BPS a wellness fund, which will increase to $75,000 annually (up from $40,000 today) to be used in conjunction with their full-time on-site health coach for various wellness initiatives that Brevard Schools would like to pursue during upcoming plan years.
4. Cigna is offering BPS the choice of either: adding Motivate Me ($1.95 PEPM included in ASO fees) effective 1/1/2016 for tracking various wellness initiatives with a recommended wellness plan included (this is valued at over $471K for 2016, 2017 and 2018) OR a 2-month premium holiday during the 1st year of the new agreement (worth approximately $468K). 
5. Cigna has offered their MDLive program (Telehealth Services) and waive the monthly fee of $0.50 PEPM.  
6. Cigna had offered their Stop loss interface fee ($0.55 PEPM) to be  waived for BPS (no charge) going forward.
7. Cigna is adding Health Matters for BPS effective 1/1/2016 – this new suite of health coaching tools is designed to help customers set and meet health goals by matching every customer to the right tool at the right time.  It integrates the latest insights and practices of the sociology of engagement, motivation, and rewarding behavior change with the latest in health tools and technology.
8. Cigna will continue to offer a Performance Guarantee (PG) for on-going services, offer a Pharmacy Services PG, Discount Guarantee, improved Generic Dispensing Rate (GDR)  PG and a Clinical Guarantee for their Your Health First (YHF)  disease management programs



Recommendation

Grant the Superintendent authority to contract with CIGNA Health and Life Insurance Company (CHLIC) for both medical and pharmacy third-party administrative services



Meeting Date(s)
Information - 7/21/2015
Consent after Information8/11/2015

Authority for Action
Board Policy 6320, Florida Administrative Code 6A-1.012(11)(12)(15)

Involves Expenditure of Funds Directly in the Classroom
No

Source of Funding
Operating - Other

FY
Amount
Budgeted
Fund
Cost Center
Project
Function
Object
Program
16-21TBDYES73198550010027500772000
16-21TBDYES73198500016837500772000

Contact
Mark Langdorf, Director, Office of Employee Benefits and Risk Management, ext. 620
Dr. Deborah Pace, Associate Superintendent, Office of Human Resources Services, ext. 200.


Attachment:  2016 SAMPLE ASO Integrated Agreement.pdf