CITY COUNCIL AGENDA ITEM
ACTION REQUESTED:
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Approve the recommendation by Alera Group to award Medical Claim Administration Services to Blue Cross and Blue Shield of Illinois (BCBSIL) for an amount not to exceed $2,897,891.05 in fixed costs, based on HMO and PPO enrollment, for a one-year term (Item 1 of 5)
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DEPARTMENT: Human Resources
SUBMITTED BY: Helga Oles, Director
BOARD/COMMISSION REVIEW:
N/A
BACKGROUND:
Additional recommendations related to this item are detailed in this memorandum and presented on this agenda for City Council approval:
* 25-1268: Specific Stop-Loss Insurance Policy with BlueCross and BlueShield of Illinois (Item 2 of 5)
* 25-1269: Pharmaceutical Management Services renewal with CVS-Caremark (Item 3 of 5)
* 25-1270: Group Life/Accidental Death and Dismemberment and FMLA with VOYA (Item 4 of 5)
* 25-1290: Weight Management Program-CVS-Caremark (Item 5 of 5)
On September 21, 2021, the City Council approved Alera Group to serve as the City's health benefits broker for a three-year term, with two one-year extensions. One of the duties of Alera Group is to price, negotiate, and recommend the renewal of medical insurance, pharmaceutical management, vision, and dental insurance contracts for the City.
The City is a self-insured organization and is responsible for all medical, dental, and pharmaceutical expenses for each plan. As a self-insured organization, the City contracts for administration of the medical insurance program, while internally funding actual claim expenses. The City offers three medical plans, including:
1. HMO: Health Maintenance Organization
2. PPO: Traditional Preferred Provider Organization
3. PPO-HDHP: High-Deductible Health Plan with Health Savings Account (HSA)
To limit liabilities, the City maintains individual stop-loss reinsurance for individuals with catastrophic claims of more than $200,000 for the HMO plan and $300,000 for the PPO plans. These limits are evaluated each year.
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