Sunday, June 30, 2013

Health Insurance RFP to Reappear

The City of San Angelo should issue a request for proposal for employee health insurance in the near future.  The last RFP disappeared from the city's website, but the document can be found below:

The last time around the city wanted cost reduction and specified a single provider option to lower costs.  Despite over 60% of city employees having Shannon physicians, City Council chose a plan exclusive to San Angelo Community Medical Center.  Council kept 75% of the total savings, passing 25% on to employees via a small premium reduction.  It was the latest blow to morale, following elimination of the pharmacy, passing on draconian insurance increases to employee and retiree dependents, and raising the cost to be seen in the employee health clinic for uninsured workers.

If history is a guide look for an RFP in the next two weeks.  It's specifications will be telling.  With Mayor Alvin New gone, will his "defined contribution" approach to health insurance continue?  Will Assistant City Manager/Chief Financial Officer continue his shell game on the city's health insurance fund?

Despite Council's approval of the Community exclusive provider arrangement which saved nearly $500,000, the budget was never updated for the public in the 2011-2012 FY.  The City stuck to its $7.9 health insurance million budget, only showing a $6.4 million when the final 2012-2013 budget was released.  Oddly, the Health Insurance Fund Balance is based on the prior 2012-2013 budget of roughly $8 million. The City Budget document shows $6.4 million for health insurance on page 122 and $8 million on page 91.  This is transparently bad financial management because it doesn't paint a consistent, much less clear picture.  

Like the City's Water Operating Fund it's impossible to garner a clear picture of the City's Health Insurance fund balance.  Michael Dane might as well be a magician, given the way these funds seem to bounce around, even disappear

No comments: