M&C Review


COUNCIL ACTION:  Approved on 11/6/2018 

DATE: 11/6/2018 REFERENCE NO.: **C-28918 LOG NAME: 14UNITEDHEALTHCAREADMINFEES
CODE: C TYPE: CONSENT PUBLIC HEARING: NO
SUBJECT:  

Authorize Amendment No. 1 to City Secretary Contract No. 47393 with United HealthCare Services, Inc. for Administration of the City's Medical and Disease Management Programs to Increase the Total Compensation to an Amount Up to $3,836,237.61 Annually to include an Additional $362,637.61 for the Remainder of 2018 (ALL COUNCIL DISTRICTS)


RECOMMENDATION:

It is recommended that the City Council authorize Amendment No. 1 to City Secretary Contract No. 47393 with United HealthCare Services, Inc. for administration of the City's Medical and Disease Management Programs to increase the total compensation amount up to $3,836,237.61 annually to include an additional $362,637.61 for the remainder of 2018.  

 
DISCUSSION:

The purpose of this Mayor and Council Communication (M&C) is to seek authorization from the City Council to approve Amendment No. 1 to City Secretary Contract No. 47393 (Contract). The Contract has a compensation ceiling of an amount not to exceed $3,473,600.00 annually to United HealthCare Services, Inc. (United). The Human Resources Department needs to increase the compensation ceiling to an amount not to exceed to $3,836,237.61 which represents an increase of $362,637.61 for the remainder of 2018.

The Contract was entered into with United in 2016 for administration of the City's medical and disease management programs. The Contract includes both a per-employee per-month (PEPM) cost as well as an annual compensation ceiling. The PEPM cost indicated in Exhibit B of the Contract has not changed. The PEPM costs remain $41.54 for the participants on the health center plan and $42.23 for the consumer choice plan, respectively.

The compensation ceiling was calculated in 2016 using an average PEPM of $41.04 based on the number of participants in the then basic plan and the consumer choice plan. This calculation has caused the City to be short by $362,637.61 because a greater than expected number of participants have chosen the consumer choice plan over the last couple of years, increasing the average PEPM and thereby the total compensation above the compensation ceiling.

The Human Resources Benefits Division is requesting the approval for Amendment No. 1 to Contract No. 47393, Section 4.1 Fees so that we may pay United for the remainder of 2018.

 
FISCAL INFORMATION/CERTIFICATION:

The Director of Finance certifies that the funds are included in the City Manager's approved budget for Fiscal Year 2019 for the Group Health and Life Insurance Fund. Prior to expenditure being made, the Human Resources Department has the responsibility to validate the availability of funds.

TO
    Fund Department
ID
Account Project
ID
Program Activity Budget
Year
Reference #
(Chartfield 2)
Amount

FROM
    Fund Department
ID
Account Project
ID
Program Activity Budget
Year
Reference #
(Chartfield 2)
Amount
    60109 0148520 5520115           $3,068,990.08
    71050 0148540 5520115           $767,247.52

Submitted for City Manager's Office by:
Susan Alanis (8180)
Originating Department Head:
Brian Dickerson (7783)
Additional Information Contact:
Brian Dickerson (7783)

 
 
ATTACHMENTS
  1295 City of Fort Worth.pdf