After a much-disputed process that initially awarded the business to another vendor, Glenn-Davis & Associates continues as health insurance broker for the city of Statesboro.
Sean Davis said Friday that the firm, where he is vice president and Brian Glenn president, would have a meeting this week with city Human Resources Director Jeffery Grant “just to sort of kick off the new year.” During the City Council meeting the previous Tuesday, Grant said that the city had experienced some performance issues with the company in terms of wanting a broker to be proactive, especially in saving the city money on health insurance costs.
“We were not aware of those performance issues,” Davis said. “We have since reached out to address them, and like every other either accolade or bump in the road we’ve ever had with the city, we’re going to continue to improve upon the high points and correct any low points.”
The city has more than 250 covered employees and spends more than $3 million annually on its partially self-insured employee health coverage and related costs. With Glenn-Davis & Associates’ per-employee monthly charge of $4, it stands to receive a little over $12,000 a year in direct fees as health insurance broker.
But City Council’s 3-2 vote Jan. 2 also made Glenn-Davis the city’s broker for life and disability insurance. For these, the broker is paid a commission by the insurance companies. ShawHankins, which became the other leading contender, had been the city’s life and disability broker for three years, but Glenn-Davis & Associates has been broker on the health insurance plan since 2008.
Placing all three types of employee insurance under one broker was one purpose of issuing a new request for qualifications, or RFQ, last summer, said Grant and Statesboro City Manager Randy Wetmore.
A committee of five city staff members heard presentations from three firms and recommended that City Council choose ShawHankins. By the time the recommendation was presented Sept. 19, ShawHankins’ monthly fee, initially quoted at $25 per employee, Grant said, had been negotiated down to about $20.
That still made the annual fixed cost for using ShawHankins as health insurance broker about $50,000 more than Glenn-Davis’ fee.
But city staff members said they were interested in improved and additional services from a broker. Services ShawHankins offered included paperless open enrollment, an online benefit resource center and other technology and personalized services. The company also proposed to analyze healthcare network discounts and pharmacy benefit management to reduce the cost of employees’ health care.
When City Council members first heard the staff recommendation, they also heard an assertion from ShawHankins that these efforts could save the city $1 million a year on medical claims.
This led to appeals by both Glenn-Davis and Capstone Benefits Consulting, which asserted that the $1 million savings projection was unsubstantiated.
After voting 3-2 on Oct. 3 to rescind the award to ShawHankins, City Council had its members Travis Chance and Jeff Yawn find an unaffiliated professional to review the RFQ responses.
In his report, Michael Mark of Care Coordination of America concluded that ShawHankins submitted the best response but that Glenn-Davis warranted consideration as “the incumbent” and because of its low price. He recommended that the city choose ShawHankins “if there have been any issues … and a dissatisfaction with Glenn-Davis and Associates.”
Speaking to City Council last week, Grant said that staff members had to “push” beginning in July, for Glenn-Davis to provide strategies to save on pharmacy costs. When these were received in November, they resulted in about $171,000 savings, he reports.
In another instance, he said, “bids were held back” when the city sought a new stop-loss carrier. This is the company that pays when a case exceeds $60,000, the limit of the city’s self-insurance. After staff members asked the third-party administrator if there had been other bids, this resulted in the city saving nearly $60,000, Grant said.
That occurred with the stop-loss insurer bids for fiscal years 2014 and 2015, he said in an interview Monday.
Davis said he had not been aware of the issue with the bids. But he observed that the third-party administrator is responsible for getting stop-loss quotes.
“It’s sort of one of those things where they work for us, we work for the city,” Davis said.
As Davis noted, City Council has kept Taylor Benefit Resource as its third-party administrator. Earlier in last week’s meeting, the council unanimously approved Monumental Risk-American National as the stop-loss carrier, out of bids from four companies received through Taylor, at a projected cost of $505,773.64 for the year for stop-loss and administration fees.
Wetmore did not attend last week’s meeting because he was completing a planned vacation. Monday he agreed with Grant that the staff’s concerns had to do with wanting the broker to coordinate the elements of the program and be proactive.
“I think it’s through that communication thing of who should be overseeing all of those services, who is the broker who was looking out for us, to make sure those things get taken care of, as opposed to Jeff finding out some of those things,” Wetmore said.
“We take a lot of pride in the city,” Davis said. The Glenn-Davis firm, he said, has worked with the city on things such as the establishment, several years ago, of its health and wellness clinic.
Grant said the staff members accept the council’s decision.
“That’s what we look forward to doing with Glenn-Davis in the coming years, saving the taxpayers money,” Wetmore said.
Council members Phil Boyum and Jeff Yawn cited support for the staff’s recommendation in voting to award the contract to ShawHankins. But Sam Lee Jones, Travis Chance and John Riggs voted for Glenn-Davis.
When Riggs had a special-needs child, the family faced a constant struggle getting an insurance company to pay for the child’s needs, he said during last week’s meeting. So Riggs said he specifically asked some city employees with special-needs children about the support they received from the broker.
“And it was expressed to me how much they got from Glenn-Davis, and that means a lot to me,” he said.
Riggs said the firm also “went above and beyond,” to get secure payment for a surgery he needed when an insurer placed obstacles in his way.
Herald reporter Al Hackle may be reached at (912) 489-9458.