HomeMy WebLinkAbout~Master - Contract for Benefits Brokerage, Consulting, and Actuarial Services for FY 2023/24 RESOLUTION NO. 23-378
RESOLUTION AWARDING CONTRACT
WITH GALLAGHER BENEFIT SERVICES,IOWA FOR BENEFITS BROKERAGE,
CONSULTING AND ACTUARIAL SERVICES FOR FY 2023/24
FOR THE CITY OF AMES,IOWA
WHEREAS,the City provides health benefits to full-time and regular part-time employees
including medical insurance, dental insurance, life and accidental death/dismemberment(AD&D)
insurance, disability insurance, prescription drug coverage, flex spending, an employee wellness
plan, and optional vision coverage. These services are provided by a variety of vendors and
underwriters; and,
WHEREAS, the City's health insurance plans are "non-grandfathered medical plans"
under the Patient Protection and Affordable Care Act (ACA). As permitted by the ACA, a non-
grandfathered medical plan can make changes to certain aspects of the plan, including employee
contributions, as long as they meet the minimum requirements under ACA regulations; and,
WHEREAS, the ACA regulations continues to increase and change compliance
requirements,and the complexity of analyzing and valuing proposed plan changes is not something
City staff has full expertise to determine best practices without the assistance of contracted,
qualified professionals. Additionally, brokerage services can secure best-in-class offers for
insurance coverage and other benefits; and,
WHEREAS, on March 9, 2023, the City solicited Request for Proposals (RFPs) for health
benefits brokerage, consulting and actuarial valuation services for our self-funded health plan.
Requested services included:
• Benefit consulting and brokerage for self-funded employer-sponsored plans, including
evaluation of non-grandfathered health insurance status, plan design, forecasting health claim
costs, rate setting, annual comprehensive Pharmacy Benefit Manager (PBM) auditing, one-time
PBM Request for Proposal (RFP), Life and Long-Term Disability(LTD) insurance coverage, and
compliance with regulations
• Actuarial valuation and financial disclosures required to comply with governmental
accounting standards related to other post-employment benefits (OPEB)
•Actuarial valuation and recommendation for self-insured calculation for Patient Centered
Outcomes Research Institute Fee (PCORI)
• Actuarial valuation and reporting required for the State of Iowa 509A Certificate of
Compliance for self-funded health plans sponsored by a public employer
• Brokerage of all employee benefit insurance offerings; and,
WHEREAS,responses were received from six firms. An evaluation committee composed
of City staff from Human Resources, Police, Finance, and the City Manager's Office evaluated
each proposal based on cost of services, the consulting firm's qualifications, benefit consulting
expertise, PBM analysis and auditing of services based on vendor contract, certified actuarial
personnel and resources, similar services provided for other governmental entities of similar size
with self-insured health benefit plan models and the ability to benchmark those plans, references,
and the availability of the team to meet our timeline; and,
WHEREAS, Gallagher Benefit Services, Inc. (Gallagher) has significant experience
successfully providing the services the City is requesting, and has experience providing those
services for local governments. Gallagher was also the only vendor that provides in-house actuarial
services, which provides an advantage since the actuarial data gathered for valuation can also be
used for other health benefit analysis; and,
WHEREAS, the first-year(FY 2023/24) cost for Gallagher's services is $54,000. The FY
2023/24 Budget includes$43,500 for health benefit consulting/brokerage/compliance/auditing and
actuarial valuation services. Since benefits brokerage services were not considered when the FY
2023/24 Budget was developed,the$10,500 shortfall will be covered by the available fund balance
and will be included in a future FY 2023/24 budget amendment. The Health Insurance Fund has a
substantial balance that can accommodate this shortfall, and staff anticipates significant savings
compared to budgeted amounts with an upcoming Pharmacy Benefits Manager transition in the
second half of this fiscal year. Future year costs of the contract will then be included as part of the
regular budgeting process and financial planning for the fund.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Ames, Iowa,
that award of contract to Gallagher Benefit Services, Inc., West Des Moines, Iowa, for benefits
brokerage, consulting and actuarial services beginning July 1, 2023, to June 30, 2024, at a cost of
$54,000 is hereby approved.
ADOPTED THIS 27th day of June, 2023.
Renee hall, City Clerk John A. Haila, Mayor
Introduced by: Betcher
Seconded by: Gartin
Voting aye: Beatty-Hansen, Betcher, Corrieri, Gartin, Junck, Rollins
Voting nay: None Absent: None
Resolution declared adopted and signed by the Mayor this 271h day of June, 2023.