Placement: Consent Agenda
Action Requested: Motion / Vote
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Approve Florida Blue Stop Loss Insurance Policy-Fiscal Year 2025/2026
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Submitted By: Thema Neal, Operations Manager, Human Resources
Strategic Plan Link: The City's Goal of a high-performing city government organization.
Summary Brief (Agreements/Contracts only)
1. Prepared by: Thema Neal, Human Resources
2. Parties: City of Port St. Lucie and Florida Blue/ISU
3. Purpose: To provide Stop Loss Insurance for medical claims.
4. New/Renewal/Modified: New
5. Duration: 1 year
6. Benefits to Port St. Lucie: To provide protection to the City for medical claims that exceed the threshold of $500,000.00 per claimant.
7. Cost to Port St. Lucie (Annual and Potential): The estimated expenditure for FY 25/26 is $1,520,165.00 (a 1.2% decrease over FY 24/25 cost, plus the $100,000 laser for a total increase of 5.31%).
Presentation Information: Staff and the Gehring Group are available to answer any questions the Council might have.
Staff Recommendation: Move that the Council waive the bidding, per chapter 35.04(c) good cause shown and approve the renewal of stop loss insurance with Florida Blue.
Alternate Recommendations:
1. Move that the Council amend the recommendation and approve the renewal of the Stop Loss insurance with Florida Blue.
2. Move that the Council not approve the recommendation and provide staff direction.
Background:
Stop Loss insurance is a component of the City’s self-funded health insurance program, providing protection from the financial risk of unpredictable high-cost and/or high-volume claims filed under the plan. This coverage safeguards the City’s financial health by capping exposure to catastrophic claims.
In 2024, the City’s insurance broker Gehring Group released an RFP to the market and solicited responses for Stop Loss insurance proposals. A total of twenty (20) proposals were received from seven (7) carriers, and all proposals were vetted by the Gehring Group and the City. Florida Blue had the best coverage for the most cost-effective amount.
Gehring Group, directly negotiated with Florida Blue-our current medical provider-to renew the Stop Loss plan as Florida Blue offered the most cost-effective option. Additionally, as the City’s current provider, Florida Blue offers seamless integration, allowing for real-time claims processing, prompt identification of claims that exceed the Stop Loss threshold, and timely reimbursement to the City.
Based upon market factors and the City’s claim data the City’s actuary assumed a 15% increase in stop loss premiums for FY 2025/2026. The option before you for consideration proposes an increase of 5.31%.
Issues/Analysis:
The proposed policy retains the Individual Specific Limit (ISL) at $500,000.00 per claimant.
Key differences from the current policy:
• A 36/12 look-back period is included, meaning claims incurred up to thirty-six (36) months prior to the policy’s effective date-but billed after October 1, 2025-will be eligible for coverage.
• The addition of a laser, which applies a higher deductible to a specific high-risk claimant based on prior claims history. This is a standard practice in Stop Loss underwriting and does not affect the ISL for other plan members.
Key consistencies with the current policy:
• The ISL remains at $500,000.00 per claimant.
• There is an unlimited maximum annual reimbursement, inclusive of both medical and prescription claims.
Financial Information: Funding has been appropriated in the Medical Trust Fund / General Government / Stop Loss account (605-1900-549353-00000).
Special Consideration: This is an annual policy, and premium costs are based on claims data from the previous plan year. Should claims data increase-particularly if more claimants meet or exceed the ISL threshold-the City may consider adjusting the ISL in future years. Lowering the ISL could result in higher premiums but may offer greater protection against large claims.
Conclusion
Based on the favorable renewal terms, seamless integration with the City’s current medical provider, and the continued protection offered by the Stop Loss policy, staff recommends approval of Florida Blue as the Stop Loss carrier for the 2025/2026 fiscal year.
The policy maintains key coverage elements, introduces a standard laser provision for one high-risk claimant, and includes a 36/12 look-back period to ensure comprehensive claims coverage.
Location of Project: N/A
Attachments:
1. Stop Loss Plan Evaluation (comparison of current plan offering versus proposed plan offering).
2. Proposed Florida Blue Stop Loss Policy for FY 25/26 in substantially the same form as attached.
NOTE: All of the listed items in the “Attachment” section above are in the custody of the City Clerk. Any item(s) not provided in City Council packets are available upon request from the City Clerk.
Internal Reference Number: 25253-08
Legal Sufficiency Review:
Reviewed by Alyssa Lunin, Deputy City Attorney. Approved as to Legal form and sufficiency by Richard Berrios, City Attorney.