Background/Overview How Insurance Services and Products Can Be Acquired
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2012 AASBO Summer Conference Insurance Pools as an Option in the Quest To Purchase Health Insurance Effectively Bill Munch, VSMG [email protected] Ken Carter, Paradise Valley USD [email protected] “The Fellowship of AASBO”
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Background/Overview How Insurance Services and Products Can Be Acquired. Two Methods for Acquiring Insurance Individually utilizing complex public procurement rules via an RFP process Join insurance pool and have pool acquire on your behalf - PowerPoint PPT Presentation
Transcript of Background/Overview How Insurance Services and Products Can Be Acquired
2012 AASBO Summer Conference
Insurance Pools as an Option in the Quest To Purchase Health Insurance Effectively
Bill Munch, [email protected]
Ken Carter, Paradise Valley [email protected]
“The Fellowship of AASBO”
Background/OverviewHow Insurance Services and Products Can Be Acquired
Two Methods for Acquiring Insurance
Individually utilizing complex public procurement rules via an RFP process Join insurance pool and have pool acquire on your behalf There are currently 23 insurance pools operating in Arizona
An insurance pool may purchase using the RFP process
An insurance pool is exempt from the procurement rules when formed under ARS 11-952.01(F) and has more flexibility when they acquire insurance services and products and therefore is able to negotiate more lucrative contracts for its members
Continuous negotiations on price and services Continuous evaluation of performance Able to enter into long term contracts/relationships
Eliminates protests and unintended bid rejections
Reduced administrative costs
Pools also offer the advantage of more negotiating power due to aggregation of members
Background/OverviewHow Insurance Services and Products Can Be Acquired
An insurance pool can be created by forming by a intergovernmental agreement (IGA) with no other purpose than to save districts money through the group purchasing of services. The concept is simple – you should get better pricing and broader services as a group than you can individually.
The insurance pool may be formed under ARS 11-952, 11-952.01,15-382 and would be specifically exempt from procurement law by Arizona statute. No RFP would be necessary to join. By forming under these statues the pool itself would be regulated through the Department of Insurance.
An employee benefits pool would not be an insurance carrier or vendor. It is instead a way to purchase insurance cooperatively.
In addition to being examined by the Department of insurance as with any insurance company, the pool would also be subject to be independently audited every year.
Background/OverviewHow Insurance Services and Products Can Be Acquired
How can the purchase of health insurance be exempt from the procurement rules?
Arizona law permits two or more public agencies to enter into contracts or agreements to jointly purchase various types of insurance, and health benefits plan insurance and related services and to pool retentions of their risks for life insurance, disability, or health claims made against any public agency within the pool and to do so on cooperative or contract basis or by the execution of a trust agreement directly by the agencies or by contracting with a third party.
A.R.S. 11-952.01(F) explicitly provides that any pool established pursuant to this section is exempt from the provisions of the Arizona Procurement Code when purchasing insurance, reinsurance or retaining certain consultants and professional services.
Background/OverviewHow Insurance Services and Products Can Be Acquired
Benefits of Self-Insurance within an Health Insurance Pool:
Each insurance pool determines its own benefits, vendors, and plans however it chooses.
Due to purchasing size, a pooled plan may help your district purchase the following services at a lower cost: Medical (provider network access & claims administration), Pharmacy Benefit Services, Stop Loss Insurance, Dental, Vision, Life, COBRA, FSA, STD, and other employee benefits for those participating in the pool. You get the benefits of economies of scale, negotiating power and knowledge of true costs.
Health insurance pools can be specifically exempt from procurement law by Arizona statute (ARS 11-952, 11- 952.01, 15-382).
Health insurance pools may contract directly with providers, allowing for best in class vendors, and preferred pricing.
The pool can be proactive in continually evaluating and negotiating all contracts, at all times. There are no “bid cycles”. It is similar to a never-ending best and final process.
Services Provided by a Health Insurance Pool
Nurse Case Management (NCM)
Company Nurse Program
Physical Therapy
Occupational Clinics
Bill Review/Provider Network
Independent Medical Examinations (IME)
Physician Specialists
RX Program
Coordinate the following Vendors
Services Provided by a Health Insurance Pool
Compliance, Accounting, Consultation and Administrative Support
Health claims payments and TPA
Pharmacy Benefit Management (PBM)
Utilization management
Disease management
Nationwide Network of Contracted Providers
Comprehensive Online Management System
Online continuous (all year) employee benefits and enrollment system
Services Provided by a Health Insurance Pool
Compliance, Accounting, Consultation and Administrative Support (cont’d)
Overall plan administration by the insurance pool
Experience, trend calculation and rate setting
Accounting, billing and support
Summary Plan Documents (SPD’s)
Consultative partner on State and Federal compliance (Health Care Reform)
Complete appeal process management
Services Provided by a Health Insurance Pool
Compliance, Accounting, Consultation and Administrative Support (cont’d)
COBRA administration
403 and 457 compliance
GASB 45 OPEB actuarial audit
FSA administration
Stop Loss insurance and reinsurance
Comprehensive online management system
Coordinate regular periodic claims audits
Services Provided by a Health Insurance Pool
Wellness
Wellness programs strategic recommendations; target goals, schedule committee interaction, communications
Wellness programs that are data driven and targeted to achieve savings and improved health
Coordinate guest speakers, health classes and other available wellness events
Provide regular health and wellness newsletters and emails for members
Incentive programs and web site
Program utilization evaluation and return on investment analysis
Services Provided by a Health Insurance Pool
Reporting and Regulatory
Monthly, Quarterly and Annual Reports needed to analyze the financial and clinical performance of your plans
Monthly claims experience reports
Quarterly financial statements
Annual clinical management, utilization trends and plan year recommendations
Annual benchmark analysis, industry trend and pool specific
Annual renewal development and recommendations
Questions and Discussion Points…
Joining an insurance pool is another cooperative purchasing option available to school districts in the never ending quest to obtain the best value for your purchasing dollar.
