Title
Stop-Loss Insurance for Active Employee Medical and Pharmacy Benefits (Ordinance S-50492)
Description
The Human Resources Department requests payment authority in the amount of $3,000,000 for required stop-loss insurance for active employee medical and pharmacy benefits.
Report
Summary
Under the Trust Agreement for the Phoenix Health Care Benefits Trust, the Trustee (the Trust Board) appointed by the City is required to obtain and maintain stop-loss insurance. Effective Jan. 1, 2024, the stop-loss insurance policy will be under the Union Labor Life Insurance Company (Ullico).
Procurement Information
A reinsurance renewal negotiation was conducted by the City's contracted benefits consultant, Foster & Foster, a licensed insurance broker. Foster & Foster successfully negotiated a renewal premium savings of approximately $195,000 with Ullico. The Health Care Benefits Trust Board approved the renewal with Ullico for stop-loss insurance.
Contract Term
The insurance policy is effective from Jan. 1, 2024 through Dec. 31, 2024.
Financial Impact
The annual insurance premium for the 2024 term is estimated at $3,000,000. The premium is based on data submitted by the City relevant to underwriting the risk. There is no impact to the City of Phoenix General Fund or the Human Resources Department operating budget, since the annual premium is paid through the Health Care Benefits Trust Fund.
Concurrence/Previous Council Action
- On Dec. 14, 2022, Phoenix City Council approved Ordinance S-49280 for the 2023 stop-loss insurance policy under Ullico.
Department
Responsible Department
This item is submitted by Assistant City Manager Lori Bays and the Human Resources Department.