HomeMy WebLinkAbout~Master - Renewal of Health Insurance Administrative Services Agreement RESOLUTION NO. 22-295
RESOLUTION APPROVING RENEWAL OF HEALTH INSURANCE
ADMINISTRATIVE SERVICES AGREEMENT
FOR THE CITY OF AMES
WHEREAS, for the past 17 years,the City has contracted with Wellmark Blue Cross Blue
Shield of Iowa to provide health insurance administration and excess insurance coverage; and,
WHEREAS, in that time, Wellmark has provided good customer service and has had a
commendable record of accurate and timely claims payments; and,
WHEREAS, Wellmark also has advantageous contractual relationships with medical
providers in Ames and throughout Iowa that allow the City to receive significant discounts on
services received; and,
WHEREAS,Wellmark has a proven record of being able to administer the existing plans and
has been a willing and capable partner in the City's efforts to improve the health status of employees
and their families through quality programs and health promotion; and,
WHEREAS, effective July 1, 2022,Wellmark will charge $50.25 per employee per month
in administrative and access fees (this is an increase of 2.3% over 2022/22); however,because the
number of covered individuals is projected to be fewer in FY 2022/23 compared to the current year,
the projected total cost for administrative and access fees in FY 2022/23 is expected to decrease by
0.01%, to $326,826; and,
WHEREAS, the individual stop loss protects the City from specific claims that exceed
$125,000 incurred in one year, while the aggregate stop loss protects the City in the event total
claims exceed 120% of projected losses; and,
WHEREAS,effective July 1,2022,Wellmark will charge$133.15 per employee per month
of specific and aggregate stop loss premium (this is a 26% increase over 2021/22); and in FY
2022/23, the City will pay$866,008 in specific and aggregate stop loss premiums; and,
WHEREAS, the overall change (increase) for health care costs, including FY 2022/23
projected claims and all of the Wellmark administrative fees,is estimated at 10.6%for FY 2022/23
(a total of approximately$10,255,752); and,
WHEREAS, staff had reported to Council on February 3, 2022, that a 7% increase in
premiums, along with the use of approximately$289,000 from the available balance in the Health
Insurance Fund would be used to finance the increased costs; and,
WHEREAS, it should be noted that for this renewal, Wellmark requested the inclusion of
a provision that allows for certain claims to be denied if the covered individual is not"actively at
work," and staff had several discussions regarding the requested language, which staff is not
supportive of including in the Agreement;however Wellmark had provided written assurances that
the provision will not be applied to a potential claim without City staff s approval.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Ames, Iowa,
that the renewal documents with Wellmark Blue Cross Blue Shield of Iowa for administrative
services, specific and aggregate excess insurance, and access fees for health care benefits effective
July 1, 2022, through June 30, 2023, are hereby approved.
ADOPTED THIS 14`h day of June, 2022.
Diane R. Voss, City Clerk John A. Haila, Mayor
Introduced by: Beatty-Hansen
Seconded by: Corrieri
Voting aye: Beatty-Hansen, Betcher, Corrieri, Gartin, Rollins
Voting nay: None Absent: Junck
Resolution declared adopted and signed by the Mayor this 14'day of June, 2022.