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HomeMy WebLinkAboutMINUTES - 11191991 - 2.2 S w ' To: BOARD OF SUPERVISORS Contra 'Y FROM: Phil Batchelor, County Administrator Costa nl s xo� County DATE: November 19, 1991 �Osra C-ons cP SUBJECT: Report from County Administrator on 1st Choice Health Plan Regarding Amending Existing Agreement and Authorizing New Agreement SPECIFIC REQUEST(S)OR RECOMMENDATION(S)&BACKGROUND AND JUSTIFICATION RECOMMMATIONS 1. Authorize the County Risk Manager to execute an agreement amendment with Synergetic Administrative Services, Inc. to pay for administrative services to the 1st Choice Health Plan at $13.16 per enrolled 1st Choice subscriber and 5.4 percent of prescription claims paid for prescription claims run-out effective October 1, 1991. 2. Authorize the County Risk Manager to execute an agreement with United Administrative Services (UAS), as recommended by the Joint Trust Labor Management Trust Committee, for 1st Choice Health Plan administrative services, paying $7.90 per enrolled 1st Choice subscriber per month, for two years effective January 9, 1992, and conduct a claims audit after the first year. 3. Ratify the Risk Manager's written notification of cancellation on October 11, 1991 to Synergetic Administrative Services, Inc. 4. Direct the County Administrator to confirm the notice of cancellation to Synergetic Administrative Services, Inc. BACKGROUND Existing Agreement. As a result of transferring the prescription drug component of the 1st Choice administrative services from Synergetic Administrative Services, Inc. to Pharmaceutical Care Network (PCN) on October 1, 1991, Synergetic has agreed to reduce its administrative fee from $13.77 to $13.16 per enrolled subscriber per month and charge 5.4 percent of prescription claims paid for the claims run-out effective October 1, 1991. CONTINUED ON ATTACHMENT: X YES SIGNATURE: RECOMMENDATION OF COUNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE APPROVE OTHER SIGNATURE(S): ACTION OF BOARD ON November 19, 1991 APPROVED AS RECOMMENDED --j( OTHER VOTE OF SUPERVISORS I HEREBY CERTIFY THAT THIS IS A TRUE UNANIMOUS(ABSENT ) AND CORRECT COPY OF AN ACTION TAKEN AYES: NOES: AND ENTERED ON THE MINUTES OF THE BOARD ABSENT: ABSTAIN: OF SUPERVISORS ON THE DATE SHOWN. CC: County Administrator ATTESTED Risk Management P Trust Committee (via Risk Management) HIL BATCHELOR,CLERK OF THE BOARD OF County Counsel SUPERVISORS AND COUNTY ADMINISTRATOR Auditor-Controller Personnel M382 (S�mergetic BY DEPUTY United Administrative Services -2- The amended agreement has been cancelled effective January 9, 1992. Written notice of cancellation was provided to Synergetic Administrative Services, Inc. on October 11, 1991 on behalf of the County by the Risk Manager. New Agreement - Role of Joint Labor Management Trust Committee. A Joint Labor Management Trust Committee, assisted by the County's health consultant Martin Segal Company, a national benefits consulting firm, initiated and completed a Request for Proposal (RFP) process for a new claims administrator. The consultant prepared the RFP and solicited proposals from eight qualified claims administrators. Five firms responded and on September 12 Martin Segal Company recommended at least three firms be considered for interview by the Trust Committee; the Trust Committee decided to interview all five firms. Enrollee Charge Name Per Month Synergetic Administrative Services, Inc. $12.56 Glen Slaughter & Associates 10.12 Delta Benefit Plans 10.05 Harry Wilson Insurance Center 10.00 United Administrative Services (UAS) 7.90 As a result of the interviews by the Trust Committee, the Trust Committee recommended that UAS be selected as the claims administrator. The Trust Committee recommended UAS because of their full scope of services and competitive administrative fees. Evaluation by the County Administrator. To insure a qualified claims administrator was being recommended, the County Administrator conducted an independent evaluation of UAS. This process included meeting with the Trust Committee; review of steps taken by the Trust Committee; meeting with UAS at County offices which included demonstration of their computer system; a site visit to UAS in San Jose; and additional reference checks. The County Administrator's evaluation of UAS led to the following finding: ♦ UAS produces a variety of management information and can segregate and analyze paid claims by illness, provider, procedure and diagnosis. ♦ UAS will do custom report design for Contra Costa County and meet with the Trust Committee and consultant quarterly. ♦ UAS has in excess of 14,000 medical claims maintained on their system. ♦ UAS files are backed up each night and stored offsite each Friday. Since the computer runs 16 hours per day, 5 days a weeks, time is available for catch up in the event of power outages. ♦ Reference checks produced strong endorsement and client satisfaction of UAS regarding responsiveness, working with Trust Committees, accuracy of claims processing, and low number of employee complaints. ♦ UAS owns an IBM System 38 which has the power and capability of processing lst Choice medical claims. They expect conversion to larger system IBM AS/400 in one to three years. ♦ UAS owns its FOCUS software which handles the full range of CPT-4 codes linked with UCR determination. ♦ Recent audits show acceptable error rates and disclose no material weaknesses. Eligibility requirements were sufficiently followed and coordination of benefits and contractual provisions were properly applied. Files are appropriately documented. Conclusion. The County Administrator concurs with the Joint Labor Management Trust Committee's recommendation that United Administrative Services provide administrative services to the 1st Choice Health Plan effective January 9, 1992.