Title
Cigna Dental Contract Extension (Ordinance S-48403)
Description
Request to authorize the City Manager, or his designee, to extend Contract 155839 with Cigna Health and Life Insurance Company (Cigna) for a sixth year, through Dec. 31, 2024, and to authorize additional payment authority in the amount of $10 million. Further request authorization for the City Controller to disburse all funds related to this item.
Report
Summary
The Human Resources Department, Benefits Division has four large complex contracts that expire at the same time. This creates challenges with conducting the RFPs, implementing the new contracts, testing plan changes, and preparing timely materials for open enrollment. This extension for the Dental Plan contract will separate the contract end dates and allow sufficient time to effectively implement Non-Medicare Retiree Health Plans, Employee Medical Plan Administrative Services Provider and Employee Pharmacy Benefits Manager. The Dental Plan was selected for the extension because it has the lowest cost value to the City.
Approval of this extension will result in effective implementation to plan changes, multiple vendor changes and better customer service to employees and retirees.
Procurement Information
This contract was originally procured through a competitive Request for Proposal (RFP) process in accordance with City policy.
Contract Term
Upon approval, the contract term will end Dec. 31, 2024.
Financial Impact
Upon the approval of the additional payment authority of $10 million, the revised aggregate value will be $60 million. Employee contributions account for approximately 20 percent of these funds. The costs for these services are paid by the Health Care Benefits Trust Fund and Dental Trust Fund.
Concurrence/Previous Council Action
The initial contract was approved by City Council on June 27, 2018 (Ordinance S-44860).
Department
Responsible Department
This item is submitted by Assistant City Manager Lori Bays and the Human Resources Department.