Title
Contract Amendment for Health and Benefits Consultant Agreement (Ordinance S-45874)
Description
Request authorization to amend the contract with Mercer Health and Benefits, LLC (Contract No. 142138) to provide consulting services to implement and oversee benefit strategies intended to improve employee health, plan performance, and utilization in an amount not to exceed $1,400,000. There is no impact to the General Fund. The costs for these services are paid by the Health Care Benefits Trust Fund. Further request authorization for the City Controller to disburse all funds related to this item.
Report
Summary
The City entered into contract with Mercer Health and Benefits, LLC on Jan. 5, 2016 to provide benefits consulting and actuarial services on an as-needed basis for the City’s health care and related benefits programs. These services include developing comprehensive benefit strategies; assessing and measuring the effectiveness of current plan offerings; evaluating utilization patterns and recommending plan modifications; projecting plan costs and developing funding scenarios; and, negotiating contractual terms and performance standards for benefits programs. Additional funding is needed to pursue a Data Warehouse Wellness Initiative, Request for Proposals (RFP) support, Employee Benefits Microsite Management, benefits claims audit, and a Health Care Benefits Trust Fund reserves study, all of which are anticipated to produce cost savings for the employees and the Health Care Trust Fund.
Procurement Information
In 2015, a formal RFP was conducted and Mercer Health and Benefits, LLC. was awarded the contract.
Contract Term
The existing Agreement began on Jan. 5, 2016 for a three-year period with the option to extend the Agreement for two one-year terms totaling $1.1 million. The first amendment, executed Aug. 19, 2016, expanded the scope of work to include the Retiree Medical Rate Setting Project and associated costs including approval to spend $50,000 per year. The second amendment exercised the first option to extend the Agreement for one year which will terminate on Jan. 4, 2020. The second option to extend the Agreement for the final year is anticipated to be effective Jan. 5, 2020, terminating on Jan. 4, 2021.
Financial Impact
There is no impact to the General Fund. The costs for these services are paid by the Health Care Benefits Trust Fund.
Concurrence/Previous Council Action
The Health Care Benefits Trust Board approved these strategies on March 28, 2019.
Department
Responsible Department
This item is submitted by Acting Deputy City Manager Toni Maccarone and the Human Resources Department.