Loading...
HomeMy WebLinkAboutAgenda Statement 1986/09/02 Item 4 COUNCIL AGENDA STATEMENT Item 4 Meeting Date 9/2/86 ITEM TITLE: Resolution Approving the implementation of a new group health and life insurance plan for City employees from MONY (Mutual of New York) for the plan year beginning October 1 , 1986 and ending September 30, 1987. SUBMITTED BY: Acting Director of Personnel (t REVIEWED BY: City Manager (4/5ths Vote: Yes No X ) Earlier this year, the City Council authorized staff to begin the process of exploring alternative group health and life insurance plans. Because health insurance benefits are subject to Meet and Confer, a Health Insurance Committee, consisting of representatives of the City and each Bargaining Unit, was formed to assist staff in the selection of a consultant to review health insurance proposals. Acting on the recommendation of staff and that Committee, the City entered into a consulting agreement with Warren, McVeigh and Griffin, Inc. , on February 18, 1986. Eleven health insurance providers were sent Requests for Proposal . These providers were specifically instructed to respond with proposals which duplicated or bettered the benefit levels of the existing group health plan under Travelers. Six providers responded: Travelers, Coordinated Benefits, Northwestern National Life, The Hartford, MONY (Mutual of New York) and Group Services, Inc. The proposals were evaluated by Warren, McVeigh and Griffin, Inc. and a copy of their report is attached (Exhibit A) for your review. The consultant's primary recommendation, found on page 3 of the Management Summary, is that the City change its health insurance carrier from Travelers to MONY. A subsequent review and evaluation was conducted by the Health Insurance Committee and by management staff and it is the staff's and the Committee's recommendation that the City implement the MONY health plan effective October 1 , 1986. RECOMMENDATION: That Council adopt the resolution to implement the MONY group health insurance plan. BOARDS/COMMISSIONS RECOMMENDATION: Not applicable. DISCUSSION: Historically, the City has offered employees a choice of health insurance plans between Kaiser, which is an HMO (Health Maintenance Organization) , or Travelers, which is a conventionally insured, indemnity health plan. Kaiser will continue to be a health plan option. This report deals only with the replacement of the Travelers health plan. Page 2, Item 4 Meeting Date 9/2/86 The Health Insurance Committee concentrated on the low bids, proposed by Travelers and MONY. The Travelers proposal included a renewal quote to be effective upon expiration of the annual contract, July 16, 1986. The renewal quote was 7% less than the previous years' plan costs. Travelers agreed to renew the City's contract for 1986-87 on a month-to-month basis, at the renewal quote, until the Request for Proposal selection process was completed. The Travelers proposal also included a quote for a PPO (Preferred Provider Organization) plan which was significantly less than any other proposal , however, the Travelers PPO plan would have resulted in substantially increased out-of-pocket costs for employees. For this reason, the lowest bid by Travelers was rejected. MONY has proposed a Minimum Premium Plan, which is a variation of the conventionally insured health plan the City has had in the past. In a conventionally insured arrangement, the City simply pays premiums to an insurance company which are intended to cover the cost of claims, overhead expenses, premium taxes, and reserves for the incurred-but-not-paid claims. If claims in any year are less than the amount collected in premiums, the insurance company retains these funds as a surplus to be applied against future adverse claims experience to prevent dramatic rate increases. Conversely, claims in any year that are in excess of the amount collected in premium result in deficits which are carried over into future years and reflected in premium increases. Thus, the full extent of the City's liability is greater than the annual premiums due to the carrying forward of deficits in order for the company to recoup 100% of the claims cost. In the Minimum Premium Plan proposed by MONY, the City is charged a monthly administration fee per employee to administer claims plus a monthly premium for stop loss protection. This stop loss arrangement calls for the City to fund for potential claims, but only to a specific point. Catastrophic claims for individuals, that is, claims in excess of $35,000 per year, are paid by MONY. In the aggregate, annual claims over $413,495 are also paid by MONY. The administration fee and stop loss premiums are fixed monthly charges per employee. Monthly payment for claims is based on actual claims paid by MONY and reimbursed by the City each month. In this fashion, the City maintains investment control over premium dollars and benefits from good claims experience throughout the year. The monthly premium quoted by MONY represents the City's maximum liability for this year. Actual plan costs could be less with good claims experience. The estimated annual plan costs for MONY are approximately 17% less than the annual plan costs under the Travelers renewal quote, and 23% less than 1985-86 Travelers plan costs. PREMIUMS-HEALTH INSURANCE A comparison of existing premiums with Travelers to proposed MONY premiums appears below. Historically, the City has had a two tier premium structure Page 3, Item 4 Meeting Date 9/2/86 with Travelers: "employee only" and "employee plus family." MONY has proposed both a two tier and a three tier premium structure based on the needs and interests of the various bargaining units. The Chula Vista Employees Association (CVEA) is interested in the two tier structure while all other Bargaining Units are interested in the three tier structure. Two Tier Structure Travelers 1985-86 Travelers Renewal MONY Employee $ 70.26 $ 65.21 $ 62.11 Employee + family 208.58 193.57 173.91 Retiree $ 82.26 $ 76.33 $ 62.11 Retiree + family 164.52 152.66 173.91 Three Tier Structure Travelers 1985-86 Travelers Renewal MONY Employee $ 70.26 $ 65.21 $ 62.11 Employee + one 208.58 193.57 127.33 Employee + family 208.58 193.57 197.20 Retiree $ 82.26 $ 76.33 $ 62.11 Retiree + one 164.52 152.66 127.33 Retiree + family 164.52 152.66 197.20 BENEFITS Appended to this report as Exhibit B is a comparison analysis of the proposed MONY health plan to the existing Travelers health plan. MONY has certified that they will duplicate the benefit levels that active employees and retirees have now. The analysis is not all-inclusive, but rather is intended to show the major areas where the plans differ. The MONY health plan is a PPO plan (Preferred Provider Organization) , wherein one has free choice of physician; however, there is an incentive to select a physician who is a member of the PPO because the employee co-payments are less. An individual who utilizes a PPO physician or hospital has a co-payment of 5% of a pre-negotiated rate instead of a 20% co-payment of a rate considered to be usual , customary and reasonable in this region. In addition the MONY health plan includes several cost containment provisions such as: - ambulatory surgery paid at 100% - second surgical opinions paid at 100% - hospital utilization review Page 4, Item 4 Meeting Date 9/2/86 In the past, claims have been handled through the Personnel Department. Under the proposed MONY plan, claims payment would be direct and questions would be handled by a claims adjuster who can be reached by a toll free phone number. SPECIAL ISSUES In the course of our meetings, Health Insurance Committee members expressed concern about retirees, their level of coverage and their cost. Currently, retirees pay their premium, through the City, for a plan that has a slightly lower level of benefits. Specifically, there is no cap on out-of-pocket costs for retirees, and the lifetime maximum is $100,000 compared to $1 ,000,000 for active employees. There are no plans to change this scenario now and the City has made no commitment to any changes; however, the Health Insurance Committee plans to continue to meet over this next year to study the various issues and long-term impact of changing retiree benefits or the way in which those benefits are provided. OPEN ENROLLMENT If Council accepts the recommendation in this report, an open enrollment period will be established for the month of September. This is a "window" period during which employees may enroll in any health plan offered by the City or switch from one health plan to another. It is during this period that dependents may be enrolled without having to qualify with evidence of good health. Numerous employee meetings will be held during the open enrollment period to answer questions and assist employees in making the best choice of health care for the next year. CONCLUSION The proposed MONY health plan offers an improved benefit plan at a lower cost to employees. The company has an excellent service-oriented reputation, as evidenced by their commitment to pay "clean" claims within 10 days or less. In addition, the City will realize improved cash flow in the payment of claims by not being required to pay claims in advance, but rather on a reimbursement basis to the company. There are distinct advantages in having stop loss protection and no deficit carry-forward to future years. For these reasons, staff recommends the implementation of the MONY health plan. FISCAL IMPACT: Adequate funds are included in the FY 1986-87 budget to pay the City's obligation for health insurance. Due to the different arrangements with the various Bargaining Units regarding the payment of health insurance premiums, the net cost to the City will not change. WPC 0542K by the City Council of Chula Vista, California Dated • °�, /Q/i EXHIBIT A City of Chula Vista EVALUATION OF HOSPITALIZATION AND MEDICAL INSURANCE PROPOSALS June 13, 1986 Warren, McVeigh & Griffin, Inc. 1420 Bristol Street North, Suite 220 Newport Beach, California 92660 JI t_; Warren, McVeigh & Griffin, Inc. Risk Management Consultants June 13, 1986 Ms. Diana M. Levin Risk Manager City of Chula Vista 275 Fourth Avenue Chula Vista, CA 92010 Evaluation of Hospitalization and Medical Insurance Proposals Dear Ms. Levin: We were retained by the City of Chula Vista (City) to evaluate proposals from insurance companies and third party administrators with respect to the City's hospitalization and medical insurance plan currently underwritten and administered by the Travelers. The scope of this assignment was to evaluate these proposals to determine: 1. The extent to which the respondent duplicated the current plan of benefits, in terms of plan design, benefit limitations and exclusions, cost-containment features, and underwriting assumptions. 2. The cost to provide the proposed coverages and services. 3. The ability of the respondent to perform the proposed services. 4. The quality of the performance of the respondent as respects timeliness, accuracy and overall efficiency of claim processing, eligibility and premium administration. 5. The affect of implementing a Preferred Provider Organization (PPO) on the current benefit plan design and associated cost savings. 6. The adequacy of the respondents alternative funding recommendations as respects minimum premium and self-funding. We have enclosed four exhibits and five appendixes. These exhibits and appendixes are briefly summarized below: Exhibit 1 compares each respondents conformance with the Request For Proposal (RFP). Exhibit 2 provides a summary of the respondents coverage underwriters with their respective A.M. Best rating, administrators and PPO recommendations. 1420 Bristol Street North,Newport Beach,California 92660 • (714)752-1058 111 Ms. Diana M. Levin June 13, 1986 Exhibit 3 suggests a PPO plan design which the City may wish to consider. Exhibit 4 summarizes all respondents' estimated annual plan costs for each type of proposed funding. Appendices 1 through 5 compare the actual proposal of each respondent in terms of estimated annual costs. * * * * * We have appreciated the opportunity to perform this assignment for the City of Chula Vista. We stand ready to answer your questions. Sincerely, ' Timothy D. :eck Senior Employee Benefits Consultant iv Warren,McVeigh & Griffin,Inc. Warren, McVeigh&Griffin, Inc. 1 ; CONTENTS Page Introduction iii I. MANAGEMENT SUMMARY 1 II. SUMMARY OF PROPOSALS FROM RESPONDENTS 4 III. SUMMARY COMPARISON OF ESTIMATED ANNUAL PLAN COSTS 8 IV. PREFERRED PROVIDER ORGANIZATION 11 V. ADMINISTRATION AND CLAIMS PROCESSING 12 EXHIBITS 1 - Respondents' Conformance with RFP 2 - Overview of Respondents' Coverage Underwriters 3 - Preferred Provider Organization (PPO) Suggested Plan Design 4 - Summary Comparison of Estimated Annual Plan Costs for All Quoted Coverages APPENDICES 1 - Actual Respondents Summary Comparison of Estimated Conventionally Insured Annual Plan Costs 2 - Actual Respondents Summary Comparison of Estimated Minimum Premium Annual Plan Costs 3 - Actual Respondents Summary Comparison of Estimated ASO Annual Plan Costs - $25,000 Specific Stop Loss 4 Actual Respondents Summary Comparison of Estimated ASO Annual Plan Costs - $30,000 Specific Stop Loss 5 - Actual Respondents Summary Comparison of Estimated ASO Annual Plan Costs - $40,000 Specific Stop Loss Warren, McVeigh &Griffin, Inc. ) 1(: 1 L MANAGEMENT SUMMARY BACKGROUND The Travelers has underwritten hospitalization and medical insurance coverage for the City since the late 1940's. Kaiser was implemented for City employees in 1976. Currently, 396 of the City's 579 active and retired employees participate in the Travelers plan. The remaining 183 employees participate in the Kaiser plan. All employees are required to participate in one of the health plans. All active employees participate in the life and accidental death and dismemberment insurance plan underwritten by the Travelers. This includes two retirees who participate in the Life Insurance, only. The City is comprised of five principal employee groups. The City's contribution varies by employee groups. The City contributes 100% of the employee and dependent health cost for the Police and Fire groups. For the remaining groups, a flexible benefit style plan is available. The City establishes a "dollar bank," ranging from $1,800 to $2,700 per year, depending on the employee group. These funds are used to purchase employee health coverage and optional dependent coverage, as well as optional dental care, vision care and other related medical services. Recent premium increases and claims processing difficulties prompted the City to seek proposals from qualified insurance carriers and third party administrators. Fundamental to the qualification of the respondent was its ability to: 1. Duplicate the current program of benefits; and 2. Provide recommendations as to alternative funding of the City's plan. We have discussed our recommendations regarding each respondent in the body of the report. The City must decide whether or not it wishes to: 1. Renew with Travelers and seek remedial actions to eliminate the servicing problems it has experienced and further negotiate its renewal rates; or 2. Change to another carrier. Warren, McVeigh&Griffin, Inc. ); 2 The City should confirm that the Travelers proposed estimated annual plan costs for the conventional insured plan with the PPO are correct. If so, this program would result in the greatest savings to the City over MONY's proposed conventional insured plan and the proposed minimum-premium and ASO plans, if we assume that the maximum projected claims liability assumptions are likely to be realized. The down-side is that the conventional insured plan still is an experience-rated contract with a deficit carry- forward feature. Future claims experience may negate any reduction in total plan costs if expected savings are not realized from the implementation of the PPO and cost- containment features proposed by Travelers. The City's decision process should answer the following questions: 1. Is the City willing to continue its relationship with the Travelers? 2. Are the servicing problems correctable? 3. Is the City willing to invest the time needed to correct the servicing problems? 4. Does the City wish to enter into an alternative funded approach to its hospitalization and medical insurance plan? If so, do they wish to consider minimum-premium or ASO plan? The answers to the above questions will aid the City in focusing making a decision. Inherent in any change, is the possible adverse affect on employee relations and the additional administrative activities associated with the preparation of new plan documents, premium billings, eligibility, etc. These additional factors and hidden costs may negate any decision to change. If the City decides that it wishes to consider a minimum-premium or ASO approach to funding its hospitalization and medical benefits plan, it should consider the MONY Minimum Premium proposal and the NWNL ASO proposal, for the reasons discussed in this report. If the Travelers plan is terminated, the City should request a final accounting of all plan reserves. Since the Travelers plan is an experience-rated, conventionally insured contract, if any surpluses exist, the City should be entitled to recover them less Travelers' normal retention. Typically the former carrier provides this plan accounting within 18 months following plan termination. Warren,McVeigh&Griffin,Inc. ,' ,' � % 3 Our primary recommendation is that the City implement the Minimum Premium Plan, with a PPO, underwritten and administered by MONY. This plan provides the City with the advantages of self-funding without the risk. It eliminates any possibility of the City incurring and carrying forward a deficit to be recovered in future years. The administration and stop-loss charges are per-head charges and guaranteed for 12 months. Warren,McVeigh&Griffin, Inc. 4 II. SUMMARY OF PROPOSALS FROM RESPONDENTS Responses were received from the following: Insurance Carrier Third Party Administrator Travelers Coordinated Benefits Hartford Group Services MONY NWNL All respondents guaranteed proposed premiums and fees for 12 months, assuming an effective date of July 1, 1986. The level of cooperation and responsiveness was generally good. Discussions with the Travelers suggested that they were not as well prepared in terms of proposal preparation as were the other respondents. TRAVELERS RESPONSE Travelers response conformed to the RFP. However, it was incomplete with respect to the Minimum Premium and ASO underwriting assumptions. It offered all three funding approaches, Conventional Insured, Minimum Premium, and ASO. Conventional Insured Based on the assumptions in their proposal, the Travelers renewal offer would reduce the City's estimated annual plan costs 7.1% without implementation of a PPO; and 31.5% with implementation of a PPO. This assumes no change in the current plan design. Minimum Premium With respect to the funding options requested, Travelers purports to provide a minimum premium proposal. Travelers proposed what they term a "Minimum Premium" and Warren,McVeigh&Griffin, Inc. 5' "Modified Minimum Premium" plan. The difference between the two plans is that the client holds the reserves in the "Modified Minimum Premium" (MMP) and not in the "Minimum Premium" (MP) plan. The proposal was incomplete in many respects. Our analysis resulted in the conclusion that the Minimum Premium proposal is not in fact a true minimum premium plan. We make the following observations: 1 It is a variation on a conventional insured plan. In a year when there is a deficit, Travelers can carry it forward for recovery from future surpluses. 2. The basic premium which represents the "policyholder obligation" (premium), is higher for the MMP plan than for the MP plan. This does not follow underwriting logic, since in the MMP plan there would be no reserve held by the insurance company. In addition, the premium tax would be reduced. Therefore, it would follow that the total policyholder obligation would be less. 3. The implementation of their PPO would result in the same total policyholder obligation for the conventionally insured and MP or MMP plan. This would suggest no advantage to the City of implementing either minimum premium alternative. For these reasons we recommend that the minimum premium plans proposed by the Travelers be eliminated from consideration. ASO The proposal was not competitive with respect to premium rates and overall cost of administration. We recommend that the ASO plan proposed by the Travelers be eliminated from consideration. HARTFORD PROPOSAL Hartford submitted only an ASO proposal. Its Life, AD&D and Medical Benefits proposal did not conform with the RFP. It provided a Life and AD&D schedule of insurance which provided an average certificate of Warren, McVeigh&Griffin,Inc. 6 insurance of $10,000 per employee. The medical plan required mandatory pre-admission hospital certification and continued care view. With respect to the ASO funding option, Hartford proposed aggregate stop loss coverage based on 120% of expected paid claims. It was not competitive with respect to estimated plan costs and overall cost of administration. We recommend that Hartford be eliminated from consideration. MUTUAL OF NEW YORK (MONY) PROPOSAL MONY's proposal conformed with the RFP. It offered a Conventional Insured and Minimum Premium plan. It did not propose an ASO plan. Conventional Insured The MONY proposal increases the City's estimated Travelers renewal annual plan costs 3.9% without implementation of a PPO; and reduces the estimated annual plan costs 6.5% with implementation of a PPO. This assumes no change in the current plan design. If Travelers were to implement a PPO, the result would be an increase of 40.9% and 26.8%, respectively. Minimum Premium The MONY proposal is a minimum premium plan. It provides for: 1. The City to hold the reserve funds for incurred-but-unpaid claims and extended benefits until the minimum premium arrangement terminates. 2. Lower premium tax than conventional insured plans. 3. No deficit carry-forward. The administration and stop loss charges are per- head charges. Any claims that exceed the specific or aggregate stop loss in the policy period are written off by MONY. No deficit can be generated. / Warren,McVeigh&Griffin, Inc. 4. Significant cash flow advantages by not requiring advancement to pay claims until a check for benefits is presented to the City's bank. 5. Choice of $25,000, $35,000, or $40,000 specific stop loss; with 125% of expected paid claims aggregate stop loss. We recommend that the City consider this alternative as the primary program, for the reasons stated above. It offers the City the advantages of self-funding without the City assuming any fiduciary liability, since it is a fully insured plan. NORTHWESTERN NATIONAL LIFE INSURANCE (NWNL) PROPOSAL NWNL submitted an ASO proposal only. Its Life and ADbcD proposal did not conform with the RFP. It provided a schedule of insurance which provided an average certificate of insurance of $10,000 per employee. It was competitive with respect to estimated plan costs and overall cost of administration. It provides for: 1. Incurred-and-Paid-in-12-months contract. Future renewals will be a Paid-in-12- months contract. 2. No terminal liability provision. Run-out claims will be paid by NWNL for normal ASO charges. 3. Choice of $20,000, $25,000, $30,000, or $40,000 specific stop loss; with 125% of expected paid claims aggregate stop loss. We recommend that NWNL be considered as the primary ASO candidate, if the City elects to implement a self-funded funding approach for its health care program. We have three concerns: 1. NWNL will not duplicate the current Life and AD&D schedule. They require a minimum certificate of insurance of $10,000 per employee. 2. NWNL requires an attorney's opinion that the City has the statutory right to self-fund its benefits. This is not a requirement of any of the other ASO respondents. Warren, McVeigh&Griffin, Inc. 8 3. NWNL claims processing fee formula includes a component based on a percentage of paid claims (3.0% of paid claims). This creates an element of uncertainty as to the predictability of the City's claim processing/administration fee. Nevertheless, NWNL's claims processing fees are competitive. COORDINATED BENEFITS Coordinated Benefits submitted an ASO proposal only. Its Life and AD&D proposal did conform with the RFP. It was not competitive with respect to estimated plan costs and overall cost of administration. We recommend that it be eliminated from consideration. GROUP SERVICES Group Services submitted an ASO proposal only. Its Life and AD&D proposal did not conform with the RFP. It did not provide a schedule of insurance, although its proposal did indicate that this insurance could be obtained from Guardian Life. Its estimated plan costs and overall cost of administration were not competitive. We recommend that it be eliminated from consideration. Warren, McVeigh&Griffin, Inc. a III. SUMMARY COMPARISON OF ESTIMATED ANNUAL PLAN COSTS Due to the complexity of this analysis we elected to examine estimated total annual plan costs of each respondent rather than each cost component. Appendices 1 through 5 detail the estimated annual plan costs as they relate to each proposed program and each respondent. The RFP requested each respondent to identify a "two-tier" and "three-tier" rating structure. The three-tier rating structure will provide the same level of premium dollars as the two-tier rating structure. No attempt was made to compare the component rates, other than to utilize them in the development of the estimated annual plan costs. Component rates will very depending upon the plan selected and the actual participation at enrollment. As discussed earlier in this report, our analysis has resulted in the following recommendations: Funding Option Respondent Conventional Insured Travelers vs. MONY Minimum Premium MONY ASO N WNL Exhibit 4 compares the total estimated plan costs for each respondent's proposal. The City under its present arrangement pays monthly installments in the form of premiums to Travelers. The annual premium is not the full extent of the City's liability. There is a potential for carrying forward into subsequent years any deficit from prior years. Thus, Travelers anticipates ultimate recovery of 100% of all paid claims plus its retention charge. In an ASO arrangement, it is only necessary to examine the comparative administrative costs to determine the difference in costs, if any, between the respondents. Appendixes 3 through 5 illustrate the administrative costs associated with each ASO respondent. If Warren,McVeigh&Griffin, Inc. 10 we consider that paid claims are the same, the respondents would rank according to estimated annual claims administration fees, based on $500,000 annual paid claims, as follows: Actual Revised 1. Coordinated Benefits $23,700 $23,700 2. NWNL 24,192 25,827 3. Hartford 25,946 26,946 4. Group Services 33,180 33,180 5. Travelers 44,644 37,300 These figures exclude set-up charges (if any), PPO fees, and stop loss premiums. The administrator of a self-funded plan should not be selected on the sole basis of lower cost. There are a number of more important factors to consider. We have discussed these and other factors in the Administration and Claims Processing section of this report. Recognizing the various factors involved, we recommend that the City consider either a Minimum Premium or ASO approach to funding its healthcare plan. In the Minimum Premium approach the insurance company is ultimately responsible for the claims. Whereas, in the ASO approach the City would be responsible. The City must decide whether it is willing to assume the liability for the administration of their plan under an ASO arrangement or, as an alternative, enter into a Minimum Premium plan. As previously discussed, the minimum premium approach provides many of the advantages of self-funding without exposing the City to the fiduciary liability risk. We therefore recommend that the City consider the proposed MONY Minimum Premium plan with a $35,000 specific stop loss. The choice of a specific stop-loss level is a function of the premium cost and the claims cost the City is willing to absorb. Warren,McVeigh&Griffin, Inc. 11 IV. PREFERRED PROVIDER ORGANIZATION A requirement of the RFP was to include the availability and cost of a Preferred Provider Organization (PPO). It is a well-accepted fact that the integration of a PPO with a medical benefits program will dramatically reduce the overall plan costs. This is the direct result of the ability to control the delivery and cost of health care by directing employees to specific medical providers. This activity is accomplished by providing employees with the incentives of improved benefit levels. Each of the respondents offered a PPO, summarized below: Respondent PPO Travelers Travelers Hartford Coordinated HealthCare Systems (CHS) MONY MONY NWNL Community Care Network (CCN) Coordinated Benefits Community Care Network (CCN) Group Services Community Care Network (CCN) NWNL indicated that they have the availability of two other PPOs. Our analysis addresses only CCN. Estimated annual PPO costs are based on a 90% coinsurance payment level with the deductible waived. Each PPO option is prepared to provide this schedule of benefit or tailor a program to meet the City's specific needs. Exhibit 3 illustrates a sample PPO plan design. We recommend that, whether the City decides to continue with Travelers or make a change, the respective PPO option be implemented coincident to the Travelers renewal or date of change to another service provider. Warren, McVeigh&Griffin, Inc. 12 V. ADMINISTRATION AND CLAIMS PROCESSING The RFP requested responses to questions concerning the administration of eligibility, premiums, coordination of benefits (COB) and claims processing. Each respondent demonstrated to our satisfaction that they could provide a satisfactory level of service to the City. Group Services was the only respondent which agreed to consider service guarantees or penalties for claims processing. All respondents indicated that their average turn- around-time for "clean" claims range from 10-14 working days. The type, quality and content of the management reports provided for our review were adequate to provide the City with sufficient utilization review and paid claims experience data. The City should determine its concern about a local claims payment office with respect to the MONY and NWNL proposals. The claim payment offices are located in San Rafael, California and Glendale, California, respectively. The MONY proposal assumes a continuation of the City's procedure of certifying eligibility prior to a claim submission. The installation of toll-free 800 telephone numbers and direct claim service should alleviate potential employee-relations problems. We would recommend that the City: 1. Examine reports for type, quality and content that will be provided by the selected PPO. 2. Change to a "Direct" claims submission process. Warren,McVeigh&Griffin, Inc. Exhibit 1 en Page 1of2 tin CL W y Z z Z Z >0 >+>+ Z>+ Z>0 >• >+>+ C7 a ¢ v) < W a.F azr= F >4 >4 z z >0 z>4>+> >4 x >4 >+>+ z>. Z>4 >+ >+>4 O 0 U a z 3 >4 >+ .'L it Z 04 >+>+>>+>+ >+ >+ >4>+ Z>+ Z>+ >4 >+>4 z cn x� w c4 O >+ >4 >+ > >+ Z z z Z Z Z Z ›.1 >>+ >+Z >+Z Z >+>0 w7, U ° a„ 2 Z >� >>">" >4>" >+>Cs. z z z Z Z ' z Z > C4 `°`a CC ]x Cl) BC z12 W a a a>r > >, >4 > >q >, >.>r>4 . >4>z zz > z z w Z Z 2 F M 01 O .c Ga4 C.) Z 0 CD U Z a' a... w d o A h. Z g Cl) F acs W c bo m 4..4.4. 4. t O ha 60 ha to V a) a) d L U 4. m P. m car030 .0 = c°. '. mrnrnrn Le C c E E E E g, ° vy S co as ch 0 .2 ;D •'' V U U U d.C-. a) y N C a) Cl.) d d 6 D v L. y v E a V C))0t) C as •° 2 e a $' aaa) •8 E 0 ° E — x x x 0 c v � b a) d a) a) 41 O v d.°. o w w w w t. +;, . _y 'O 0.. .... O O O O p 4. '. C c 'O a) • A O O aR aR 2R 4Q q a) o. W ca L U 0 L 7 7 'O a) O W CV CV CV CV u) p V y Ig. U 'O d) _ 'D'0 o' u ��,.� °a p�p °� �� ,� E o a >a 4. 07 ea U C) U U C. ) E'O a' a .0. UO C 'C7'O c y c 44' E c>, w:w w v: o ❑ O �+ r c ,� E E v p e c as E o Y o u u'u 'o;, E c, c al ar 0 ;A a) > ; E ! jfii .-. a i : u OD O' w y ' c) w v).. d m as E m c- o 0 0 0.°1 . ar c W u 0 a .m o00o cd a)▪ a) `� ,. c p o 0 0 o E E c 03> y r l N ,,,^c,-,0- �°)° fl 'ns E U c° o °- a °^ v, Oi 'ip.'� c• d O 2 >, .c .E vsrrw4„..i. � R. d c 4. a � �� E �� E u as W 2 r W 2 � ai4v•oaiw d m O aia F aia E ai4 O F aia w a! > a) O .7 .y e4 ri x .-i c i ci C.) .-i e' ri v1 u9 CO C4' Xi U Exhibit 1 , Page 2 of 2 m >+ O 2> I` >4 >» >+ >+ >+ >4 >+>+ >+ >+ Z>» CO cn x Acr= ym C" Y< p CW Fr /r C.) a 3 >+ z >4 >+ >+ >+ >+ >4>+ >+ >+ z>+ Z m x>'" CO o >+ z >+ >+ >4 >4 >+ >+ >+ >+ >+z• et C.) C4 wJ t.:ti./ Z >+ Z Z Uzi >4 >+ >0 >4 >4 z�+ f+ x co zin. d › za• ZZ> z z z z z z w g W 0 e 0 m• y 5 E cc > 2 W G1 C c o .c— .... a ♦.. Lt V 7 e p •-•w r.' L E 'ev co d Y L. a • L .c o +w. co U 4p., p CO 17 m 4• H 2 0) e T aim Wd ., w, c 0 'e y O' ,p al V E '> c e w y m E y y y a, y w e d n, U O wad ° E $ co � o °-' a� E w V e 0 > 0 E a� or ° �e e CO w i F E a w :. 0 c $ w E w a o d F oo a� -04 e 0 I m Z:. n - 0.'o is. 3 '. c 0 co O0 vw v e E c 0 E c y E 0 E c� c o a `o ...... .E e e c .— p E> ro c v 'v W 0,m w E w o cu p F- y m c ° E m — W 0 o w c $° e4. 3 0 2 c > 0 e o. F r p flUqIill L F0 0 L c w y d y 0 G . . == U A z• 5 w U f vS H .� a �a CO°' .a Ow �4 it n ii E C x .c co Q .4 c. d 4 ui .■ t` m C7 .4 a ri a, >+z Z ca zi z / ;/ 6 o a t z Exhibit 2 C.) C.) co vi m V > U U O a O r bC p .� U r V Fr`i + ti ^� a) ~ Y 4S O O � 5 O EE � l Cu � o v� '6 � � U p E3 w w Z t7 E z ,o V a) E T, 'v �, r C C ,� L L z o CO � � a) > UU > 4, 4, 4° UU a acw a ."--4) X cc O w. � ss, -U r 'D ;� a) v U c4 r-. r-� + up 0' a) c O E Y 0 p c w EE .�, r acil0 E3 m HOm C " U cc U O cc o E3 as U U o w z U O cr > corn Z U r.r c r > a UU U ai > A c 3c O' 3 � o a) Z z z wU z wU 4-' z E3 w Z v ° x UZ w cf) W r r r > > a) > a) > a) > e0 as O >C �+ X ›-f ya .c U y O O k 0 0 O DE �' O O `� til 0 E o W a)...... L, + + r A 0 m Z y a) O c . Q+ + ,o 'o a, V a) Cl .- Cl) al U U v o yC - - a - � U : U 'v a c o ' W e O' v - c W e g. ° ° ° � ,c1)o o CO 0 0 x + U x x x x + Z U cn a O W L 4.4 r r 0 L a) >�,�1 L/. rn a) > L a) > re, tg. .~i Iii a) .�-+ `JCi .�— a) cs CZ a) a) v y a) "(13 V h a) V 12 a) a) QS 4J (j] 47 4S 43 45 oy E E� ...... 0 F E� W 0 H + 0 F I-. as E .4... to c O a) rr E a a a) o A a' E ell) ti cw ho :~ �a o. A en c w as c as c tko t. as o� c E m > a ea a) '� c o n, d0 ai c a c w pq "� ci CO v A7 E w Qj .7 a) a, c V rs as en aA n 0 U w` O 0 Exhibit 3 City of Chula Vista PREFERRED PROVIDER ORGANIZATION (PPO) SUGGESTED PLAN DESIGN Non-PPO Providers PPO Providers Inpatient Expenses (Surgery, Maternity, Room $100 Deductible Waived Deductible & Board, Mental & Nervous, 80/20 Co-insurance to 90/10 Co-insurance etc.) $2,500 Stop-Loss, then to $2,500 Stop-Loss, $100% thereafter. then 100% thereafter. Outpatient Expenses (Diagnostic, X-Ray, Lab, $100 Deductible Waived Deductible Office Visits, Prescriptions) 80/20 Co-insurance to 90/10 Co-insurance $2,500 Stop-Loss, then to $2,500 Stop-Loss, 100% thereafter. then 100% thereafter. Mental & Nervous (Outpatient) Same as Current Plan Sames as Current Plan Well-Baby Care (Immunizations, Doctor Visits) No Coverage Yes Up to age 2. $120 Limit/Year Annual Routine Physical (Age 2 & up) No Coverage 100% Not to Exceed $40 Note: This illustration is intended as a suggested PPO program developed from actual recommendations from the respondents. Actual benefits, terms and conditions will be determined by the PPO selected for implementation by the City of Chula Vista. 7 G'/ 5" ., 3 n - 4,"0 a (� Q � 0 cn -, o r'r 03ti 39 � �ix � � 4 CD a' el 0 0 O '-'�9 1.QR al R C = rnm m `C0cn con 1 cnn CD y rd O ..• °< 3 ..•oa 0, fD us 'v � ° 3 �' cDC CD 3 a b ofD ° ids roar+ t 3 'g � 3 � = �, 0 ;n � a 3 go.• 0 ..• 0 n 0 c ° 0 (D o C• 9 waC aCCD 'C 7 3q Cy O C � o oo c43 � � v ° � 5' O Z Z cn c a 4. w• (nn 0 O0• c ' > a ;� M CA CA ac°ocD3 ° w � '- 0 x Q, (n F., (D CO �."Q CD < AD 0 -r4 rr N 7 ~ 0 R' .-• 3oo ° n :Y w can N cDm g Ci 00 0 C 4 C r'" c0 r+ �. C ▪ a ° $1 m t': tv ao CO•y a 0 77 (n ,..y co r• 1.- C co 0 0 < O • (D Ul N N --' y N (p n n' C rr Z Z c `� cn a ID c ° ° m = x °1 CI '4: O~ p d W C .O (D )1 C• • "I En co I. r•r r+ O r - 0 �I 3 ' LV al lD a ft b ° , a a - t'l < n C c<D 0 > vi v°, C3 - w '0 y z A ,* Q' = � � rt z m (D m ~ O 00 C.,-, p C Cn p y Gl P 1-+ O� c, N O y '0 z ^G/7]0 vti O' Q' CD a O O. z z r c.n a s 00 3 01 ° ° z t" w .O m o . 3(n Z li ' ' r r 0 7 .-f• r,. t~ O CD V ` "' a a tb 3 ° aci b y > ti CD M c a m a 'v �_ o 0 07 0 = 0 cD a �' °� O0• .© C n a 0 CD 3 c� ° 'ti 02 cD A ° O r� $r+ in CI C CD C y m a a CL� cr -s 9 C z z a 74: cn cm 0 0 to 3 r* e4 (1) G] C rn 0 0 � c- s rv-i go a W r•r r* D t ligga °a a c a-aq macs o"CD " Z. 4 d r 9 Der a 2 - co xzx ►3 �i44r a,, � � '_' � � 'a C < c C) < m Co Sal m m ""� arty art - O O� 2 C O O ci m Z _. C O. GfD C' a' rt = = C/) � C o• .-r- � C ^C7 ' ro m' m 20 co a `tic 3 'tic (0 Q m +1 pi- a, - �' � o. b — brtc o B d n a C) C) Obi Orom . cam CD v 9 m < < d 'tia bm rt � cVa � � ao ti �° R' 0 • Om 5 = a d v°, cs a W CO f3D ti W = C CA n• t-' m m G. m CD m C co cD t4 m a M a) C O ) M cn N R1 f�D ;_z, ...e.O C .. rt m acn CrcaD i O. 0 c t a 01 ti v0) n J ro m 0., o. m - 0 C aci R' C7 f rr o C y} - N N c d R. co p,o C) CM CD N ifh GO N CO ...yam d 0 O 00.0 ...Jo CEO Z w C) W W N W C 1�Nil 00 O .. ti A7 �,� N oA y "7 'C7 a r4 z 0 a 5 W coil o 000 o = Cri v' O ° 'i' N o u, o '* AD O O C 1...• c0 0 0 Cla 3 CCD 5 m oq W Ado cD ao Z CD m O Co CD � ts4 tya vv CO o.c n r° a 3 0 c�r, 10-+ � o�o ww c'''ow CD > .y g7 . a l • DJ 00 CO N m a M o. m . c" oo cm err o0 1•-, ..„3. m O .� 0o CD 0 1-� 0 c 1-, cn << CO � c cNO � w •10 030 X � ompM � m o o > n omer G z on x n,�m r+oo 1-+ m o r . CO co n t' o cn ' yD 4 w w a �, c �... m o w D Z '- m an a vv c. '�rm = C r, w O C 0 n •►-3 Oa 043 a .y+ i rr m m err O O 7 O b o O ...„ 3 P p q � ti . > z to CD CD v.+ a ' W cn IT ice-+ CO 1-' CO .� �"� CD r � � NO X00 NN � � O h'Q i r (D CI p, a Cr! ti a m . d moo. Z — r" �N Z a cx,d m Cr' .... rt W WAD. 0 C Z ti .3'G m X' �--� t0 r CO ao° Z z Co m � -� 43. CD w0 r b m m CD m c. ° ° o O, y r a z Cr 0 'ten Z N N o 0 EA'. s 0 C y rt - o c0 0 y W a O .�.. .0 h+ N LW CO = a Q. rt C) :� G0 C co +-,• 00- CD CD O 00 1-+ O ca O m m m m r• C. (11* z 3 CD z z 0 0 0 CD _:n = . C••) ^7 0 VI m• v v , 4 < C • C C C C n 7 0 0 O tU ar in m m CD ci' o j xtpuaddv a a n. y . • Appendix 2 City of Chula Vista ACTUAL RESPONDENTS' SUMMARY COMPARISON OF ESTIMATED MINIMUM PREMIUM ANNUAL PLAN COSTS Travelers MONY (c) Modified Minimum Minimum $25,000 $35,000 $40,000 Premium Premium Specific Specific Specific Claims Liability Not Provided $411,761 $422,611 $425,241 Administration Fees $ 47,181 $ 51,495 21,801 21,801 21,801 Stop Loss Fees 44,473 33,361 29,838 PPO Fees 7,128 7,128 10,692 10,692 10,692 Administrative Not Provided Installation Fee 500 500 500 Estimated Plan Cost $428,929 $428,929 $489,227 $488,965 $488,072 Notes: (a) Figures are rounded to the nearest dollar. (b) Participation based on 396 employees and 187 dependent units. Includes 55 retirees and their eligible dependents. (c) MONY proposal provides: 1. 125% of expected paid cairns aggregate stop loss. 2. Claims Liability adjusted for inclusion of PPO with mandatory utilization review program. 3. The administration and stop loss charges are per head charges. Any claims that exceed the specific stop loss or aggregate stop loss are written off. No deficit can be generated. - (d) Excludes Life and Accidental Death & Dismemberment insurance cost. (e) Travelers proposal provides: 1. Conventional experience-rating formula which allows Travelers to carry forward any deficit into future years for recovery. 2. Specific stop loss is set at $60,000. / % Appendix 3 City of Chula Vista ACTUAL RESPONDENTS' SUMMARY COMPARISON OF ESTIMATED ASO ANNUAL PLAN COSTS $25,000 Specific Stop Loos - insurance Carriers Third-Party Administrators Coordinated Group Travelers Hartford MONY NWNL Benefits Services FIXED COST Specific Stop Loss Premium $ 67,859(e)Not Quoted Not Quoted $104,016(e) $ 84,799 $ 76,314 Aggregate Stop Loss Premium 12,070 4,000 6,257 5,641 Claims Administration Fee 44,644 24,192 23,700 33,180 Administrative Installation Fee None None 2,000 3,500 Group Conversion Fee Not Provided 1,600(d) 1,659 1,659 PPO Fee 7,128 4,752 7,110 8,295 Minimum Plan Cost $131,701 $138,560 $125,525 $128,589 PAID CLAIMS COST Aggregate Claim Liability 598,450 445,500 558,467 558,467 Maximum Plan Cost $730,151 $584,060 $683,992 $687,056 EXPECTED PLAN COST Minimum Plan Cost $122,773(i) 135,887(c) $125,525 $128,589 Expected Paid Claims 478,760 356,400 446,773 446,773 Estimated Plan Cost $601,533 $492,287 $572,298 $575,362 Notes: (a) Figures are rounded to nearest dollar. (b) Participation based on 396 employees and 187 dependent units. (c) NWNL Minimum Plan Cost adjusted for expected paid claims. Claims Administration Fee is based on a flat monthly fee plus 3.0%of actual monthly paid claims. This fee will fluctuate. (d) Assumes eight conversions at $200 each, to be consistent with other respondents. This fee will fluctuate. (e) $20,000 specific stop loss also quoted,but not illustrated. (f) PPO fee includes mandatory utilization review program. (g) Excludes Life and Accidental Death &Dismemberment Insurance cost. (h) Includes 55 retirees and their eligible dependents. (i) Travelers Minimum Plan Cost adjusted for expected paid claims. Claims Administration Fee is based on 7.46% of actual monthly paid claims. Appendix 4 City of Chula Vista ACTUAL RESPONDENTS' SUMMARY COMPARISON OF ESTIMATED ASO ANNUAL PLAN COSTS $30,000 Specific Stop Loss Insurance Carriers Third-Party Administrators Coordinated Group Travelers Hartford(d) MONY NWNL Benefits Services FIXED COST Specific Stop Loss Premium $ 50,941 $ 78,454 Not Quoted $ 90,354 $ 70,484 $ 63,421 Aggregate Stop Loss Premium 12,070 10,000 4,000 6,257 5,641 Claims Administration Fee 44,644 25,946 24,192 23,700 33,180 Administrative Installation Fee None None None Group Conversion Fee Not Quoted 1,426 1,600(e) 1,659 1,659 PPO Fee 7 L---128 9,504 4,752 7,110 $,295 Minimum Plan Cost $114,783 $125,330 $124,898 $111,210 $115,696 PAID CLAIMS COST Aggregate Claim Liability 598,450 449____i____587 445,400 558,467 558,457 Maximum Plan Cost $713,233 $574,917 $570,398 $669,677 $674,163 EXPECTED PLAN COST Minimum Plan Cost $105,855(h) $125,330 122,225(f) $111,210 $115,696 Expected Paid Claims 478 2.--760 374,656 356,400 446,773 446,773 Estimated Plan Cost $584,615 $499,986 $478,625 $557,983 $562,469 Notes: (a) Figures are rounded to nearest dollar. (b) Participation based on 396 employees and 187 dependent units. Includes 55 retirees and their eligible dependents, (c) PPO fee includes mandatory utilization review program. (d) Hartford aggregate stop loss attachment point is 120% of expected annual paid claims. All other respondents are at 125%of expected annual paid claims. (e) Assumes eight conversions at $200 each, to be consistent with other respondents. This fee will fluctuate. (f) NWNL Minimum Plan Cost adjusted for expected paid claims. Claims Administration Fee is based on a flat monthly fee plus 3.0%of actual monthly paid claims. This fee will fluctuate. (g) Excludes Life and AD&D insurance cost. (h) Travelers Minimum Plan Cost adjusted for expected paid claims. Claims Administration Fee is based on 7.46% of actual monthly paid claims. • Appendix °.5 City of Chula Vista ACTUAL RESPONDENTS' SUMMARY COMPARISON OF ESTIMATED ASO ANNUAL PLAN COSTS $40,000 Specific Stop Loss Insurance Carriers Third-Party Administrators Coordinated Group Travelers Hartford(d) MONY NWNL Benefits Services FIXED COST Specific Stop Loss Premium $ 30,983 $ 60,129(e)Not Quoted $ 71,584 $ 49,296 $ 44,366 Aggregate Stop Loss Premium 12,070 10,000 4,000 6,257 5,641 Claims Administration Fee 44,644 25,946 24,192 23,700 33,120 Administrative Installation Fee None None None 2,000 3,500 Group Conversion Fee Not Quoted 1,426 1,600(f) 1,659 1,659 PPO Fee 7,128 9,504 4,752 7,110 8,295 Minimum Plan Cost $ 94,825 $107,005 $106,128 $ 88,022 $ 96,641 PAID CLAIMS COST Aggregate Claim Liability 598,450 449,587 445,500 558,467 558,467 Maximum Plan Cost $693,275 $556,592 $551,628 $646,489 $655,108 EXPECTED PLAN COST Minimum Plan Cost $ 85,897(i) $107,005 103,455(g) $ 88,022 $ 96,641 Expected Paid Claims 478,760 374,656 356,400 446,773 446,773 Estimated Plan Cost $564,657 $481,661 $459,855 $534,795 $543,414 Notes: (a) Figures are rounded to nearest dollar. (b) Participation based on 396 employees and 187 dependent units. Includes 55 retirees and their eligible dependents. (c) PPO fee includes mandatory utilization review program. (d) Hartford aggregate stop loss attachment point is 120% of expected annual paid claims. All other respondents are at 125%of expected annual paid claims. (e) $60,000 specific stop loss also quoted,but not illustrated. (f) Assumes eight conversions at $200 each to be consistent with other respondents. This fee will fluctuate. (g) NWNL Minimum Plan Cost adjusted for expected paid claims. Claims Administration Fee is based on flat monthly fee plus 3.0%of actual monthly paid claims. This fee will fluctuate. (h) Excludes Life and AD&D insurance cost. (i) Travelers Minimum Plan Cost adjusted for expected paid claims. Claims Administration Fee is based on 7.46% of actual monthly paid claims. /) , .. EXHIPIT B M O N Y P P O TRAVELERS PREFERRED PROVIDER •• i PROVIDER EXISTING PLAN HOSPITAL (R&B & ANCILLARIES) 95% OF NEGOTIATED PER 80% OF ELIGIBLE CHARG- DIEM ES U.C.R. 80% OF U.C.R. PRE-ADMISSION TESTING 100% PAID 100% PAID 80% OF U.C.R. PHYSICIAN SERVICES 95% OF NEGOTIATED 80% OF UCR CHARGES R.V.S. SCHEDULE 80% OF U.C.R. LABORATORY, X-RAYS, OTHER TESTING 95% OF NEGOTIATED 80% OF UCR OUTSIDE HOSPITAL R.V.S. SCHEDULE IF 80% OF U.C.R. PERFORMED BY PPO _ PRESCRIPTION DRUGS $3.00 CO PAY $3.00 CO PAY 80% OF U.C.R. DEDUCTIBLES $100 PER INDIVIDUAL $100 PER INDIVIDUAL $100 PER INDIVIDUAL - NO CAP UNLESS TWO OR MORE S300 MAX PER FAMILY $300 MAX PER FAMILY FAMILY MEMBERS INJURED IN SAME ACCIDENT IN CARRYOVER PROVISION CARRYOVER PROVISION WHICH CASE ONE DEDUCTIBLE APPLIES PER OCCUR- * * * * * * * * * * * * * * * * ENCE. CARRY-OVER PROVISION. $50 PER VISIT TO $50 PER VISIT TO EMERGENCY ROOM IF EMERGENCY ROOM IF NO EMERGENCY NO EMERGENCY "HOSPITAL UTILIZATION REVIEW' (HUR) HOSPITALIZATION REVIEW REQUIRED ON ALL ADMISSIONS. IN EMERGENCY, 48 HOURS TO NOTIFY. ALL BENEFITS REDUCED TO 60% IF NO NOTIFICATION. IF SECOND OPIN- NONE ION IS REQUIRED, PAID AT 100%. I` OUT OF POCKET MAX NO CARRYOVER NO CARRYOVER $500 PER PERSON $225 PER PERSON OR $600 PER PERSON OR OUT-PATIENT PSYCH DOES NOT APPLY. $300 DEDUCTIBLE PLUS $300 DEDUCTIBLE PLUS 5% OF $2500 PER PER- 20% OF $2500 PER PER- SON, SON. OUTPATIENT PSYCH DOES NOT APPLY AMBULATORY SURGERY IF H.U.R. NOTIFIED, ALL BENEFITS COVERED AT 80% OF U.C.R. 100% OUTPATIENT $30 FOR UP TO 50 VISITS PER YEAR $15 FOR UP TO 50 VISITS PER YEAR ALL OTHER COVERED MEDICAL EXPENSES LIMITED TO PSYCHIATRIC/PSYCHOLOGICAL $10,000 LIFETIME MAX 50`x. INPATIENT PSYCHIATRIC 95% OF NEGOTIATED PER 80% OF U.C.R. DIEM 80% OF U.C.R. SUBJECT TO $10,000 MAX SUBJECT TO $10,000 MAX DRUG/ALCOHOL ABUSE TREATMENT 95% OF NEGOTIATED PER 80% OF U.C.R. DIEM SUBJECT TO $10,000 MAX 80'6 OF U.C.R. CHIROPRACTIC 80% OF U.C.R. 80e OF U.C.R. BIRTHING CENTERS 100% PAID 100% PAID no h o s p. '}O' OF U.C.R. - BIRTHING CENTERS ALL BABY CARE WELL BABY CARE well-baby care DEPENDENT CHILD LEARNING 80% OF FIRST S200 FOR DIAGNOSTIC TESTING IMPAIRMENT 50 OF ALL OTHER ELIGIBLE EXPENSES NO BENEFIT $6000 LIFETIME MAX LIMITED TO 51500 EVERY 6 MONTHS -U.C.R. = Usual Customary and Reasonable Charges