Placement: New Business
Action Requested: Motion / Vote
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Approval to Waive the Bidding for Good Cause Shown, Pursuant to Section 35.04(c) of the Code of Ordinances, and Negotiate the Renewal and Amended Terms to Contract No. 20100076 between the City of Port St. Lucie and Blue Cross Blue Shield of Florida, Inc. d/b/a Florida Blue
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Submitted By: Russ Blackburn, City Manager
Strategic Plan Link: The City’s Mission to be financially responsible.
Summary Brief (Agreements/Contracts only)
1. Prepared by: Gehring Group o/b/o City of Port St. Lucie
2. Parties: City of Port St. Lucie and Blue Cross Blue Shield of Florida, Inc. d/b/a Florida Blue
3. Purpose: Renewal of the existing contract between the City of Port St. Lucie and Florida Blue and to waive the bidding for good cause shown.
4. New/Renewal/Modified: Renewal with modifications to terms.
5. Duration: Five (5) year contract term (10/1/21-9/30/26).
6. Benefits to Port St. Lucie: Phenomenal health coverage, increased benefits, and better incentive programs available to City employees with the least financial impact to the City.
7. Cost to Port St. Lucie (Annual and Potential): Administrative Fees will increase incrementally over the 5 year term of the Contract. The total Administrative Fee expenditure over the 5 year term will amount to $3,713,415.00 broken down as follows: (1) $716,717.00 in FY 21-22; (2) $743,213.00 in FY 22-23; (3) $743,213.00 in FY 23-24; (4) $743,213.00 in FY 24-25; and (5) $767,059.00 in FY 25-26. The Wellness Initiative expenditure over the 5 year term will amount to $375,000.00 ($75,000.00 per year).
Presentation Information: City Staff and Gehring Group have prepared a brief presentation.
Staff Recommendation: Move that the Council waive the bidding process and direct staff to negotiate the terms of a renewal contract with Florida Blue.
Alternate Recommendations:
1. Move that the Council amend the recommendation and waive the bidding process and direct staff to negotiate the terms of a new contract with Florida Blue.
2. Move that the Council provide staff direction.
Background: The existing Contract between the City of Port St. Lucie and Florida Blue, Contract No. 20100076, shall terminate as of September 30, 2021. The Gehring Group has conducted a comprehensive comparable entities benchmark analysis evidencing that Florida Blue was the recent lowest bidder in comparable jurisdictions and offers the best terms and conditions for the best cost. The City of Port St. Lucie is positioned to receive better rates than comparable jurisdictions by renegotiating the contract with Florida Blue. Additionally, the City will receive greater funding through Wellness Initiative incentives than comparable jurisdictions.
Issues/Analysis: This agenda item seeks City Council authorization to waive the bidding requirements for good cause shown, pursuant to Section 35.04(c) of the Code of Ordinances, and to authorize City staff to negotiate the terms and conditions of a contract renewal with Florida Blue. Staff recommends approval of the waiver request to provide health services to City employees at the most favorable terms and in the most cost efficient manner.
Financial Information: The Administrative Fees for the 5 year term of the contract, totaling $3,713,415.00, will be allocated to Fund 605-1900-549350BCBSF. The Wellness Initiative fees for the 5 year term of the contract, totaling $375,000.00, will be allocated to Fund 605-6220-548000. No early termination fees shall apply.
Special Consideration: The existing contract with Florida Blue is set to terminate as of September 30, 2021. A solicitation for health insurance, with favorable responses and proposals, can take a minimum of four (4) to six (6) months to procure.
Location of Project: N/A
Attachments:
1. Gehring Group Medical Insurance Evaluation for 2020/2021;
2. Original Blue Cross/Blue Shield of Florida Contract, Contract #20100076, entered into on February 27, 2012; and
3. Gehring Group PowerPoint Presentation.
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: N/A
Legal Sufficiency Review:
Reviewed by James D. Stokes, City Attorney. Approved as to Legal form and sufficiency by James D. Stokes, City Attorney.