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HomeMy WebLinkAboutAgenda Statement 1986/02/18 Item 12 COUNCIL AGENDA STATEMENT Item 12 Meeting Date 2/18/86 ITEM TITLE: Resolution / 132 Approving agreement with Warren, McVeigh and Griffin, Inc. for consulting services for evaluating health insurance bids and authorizing Mayor to execute the agreement SUBMITTED BY: Director of Personneietk. REVIEWED BY: City Manager., 4 t (4/5ths Vote: Yes No X ) In order to determine if a change in the City' s group health insurance provider (Travelers Insurance Company) would be in the best interest of the City, it has been decided to seek bids from other carriers. The current carrier (Travelers) and the insurance coverage provided is specifically a part of two Memoranda of Understanding and, therefore, any changes are subject to negotiations. Because of this, a committee representing employees bargaining groups along with staff was formed to provide input to management in the selection process. The first step was the selection of a consultant to assist the City in evaluating the bids. Staff and committee have unanimously agreed on the consultant that is recommended to be used in evaluating the bids for health insurance coverage. RECOMMENDATION: Adopt resolution approving agreement. BOARDS/COMMISSIONS RECOMMENDATION: Not applicable. DISCUSSION: REQUEST FOR PROPOSALS Management staff and the employee committee met several times beginning early last year to develop the Request for Proposal documents, both for consulting services and for the health insurance company bids and/or self-administered programs. The Request for Proposal (RFP) for the consultant was developed and distributed to ten firms. Proposals were received back from six of the firms contacted. All consultant proposals and the associated costs received are tabulated below: 1 . Armtech - $4,400 - $5,400 ($5,400 maximum) 2. Robert Driver Company - $1 ,000 (maximum) 3. The Epler Company - $7,000- $9,000 + 20% for expenses ($9,000 maximum) 4. William Mercer-Meindinger, Inc. - $95 - $160 per hour (no limit) 5. Warren, McVeigh and Griffin, Inc. - $4,250 - $5,400 + out-of-pocket expense ($5,400 maximum) 6. The Wyatt Company - $8,000 - $10,000 ($10,000 maximum) Page 2, Item 12 Meeting Date 2/18/86 Upon receipt of the above consultant proposals, the committee evaluated each proposal against criteria that were previously developed. Key criteria points included: 1. Office location 2. Responsiveness to City' s RFP 3. Consultant' s professional qualifications 4. Consultant's proposed approach in evaluating health insurance bids. 5. Consultant' s cost EVALUATION OF RFP's Employee representatives who evaluated the written proposals were: Sol Allen representing CVEA Mike Miller representing POA Staff evaluating these proposals were: Lyman Christopher, Director of Finance Signe Ann Thorsen, Director of Personnel A summary of their evaluations of the six proposals is presented below. SUMMARY RATING SHEET PROPOSALS - CONSULTANT FOR HEALTH INSURANCE BID REVIEW PRESENTATION CONSULTANT FIRM LOCAL OFFICE CLEAR? RESPONSIVE? CLIENT LIST? QUALIFICATIONS FEE ARM TECH Laguna Hills yes yes yes, but moderate $5,400 maximum California few clients to good listed ROBERT F. DRIVER San Diego somewhat somewhat yes, good somewhat in in this $1,000 o COMPANY clear responsive inexperience of work. quite $7,000 to $9,000 A THE EPLER COMPANY San Diego somewhat mostly yes ex trienced $7,000 20% clear responsive not specific misses point not not specified $95 - $160 per hour WILLIAM M. MERCER- Orange P MEIDINGER, INC. California and missed oflconsultant addressed yes ood $5,400 maximum WARREN, McVEIGH Newport Beach mostly mostly ysive y 9 & GRIFFIN, INC. California clear mostl y somewhat good good $10,000 maximum THE WYATT COMPANY San Diego clear responsive Page 3, Item 12 Meeting Date 2/18/86 The subcommittee chose four of the six firms to continue in the process and receive a personal interview. This decision was based primarily on the fact that two firms, William Mercer and the Wyatt Company, appeared to miss the point of the RFP. It was felt that if they were unresponsive early in the process it would be difficult to work with them successfully in the difficult task of evaluating and selecting a medical insurance carrier. INTERVIEWS OF CONSULTANTS A subcommittee was established to interview the consultants: Employee representatives to the commission were: Sol Allen, representing CVEA Christopher Ashcraft, representing IAFF Ambrosio "Dal" Daluraya, Storekeeper, President CVEA Mike Miller, Police Agent Management representatives to the committee were: Gene Asmus, Assistant City Manager Lyman Christopher, Director of Finance Jim Thomson, Director of Management Services Signe Ann Thorsen, Director of Personnel The four firms that were invited were asked to make a 15 to 20 minute presentation, after which the employee committee and staff could ask questions. EVALUATION OF INTERVIEWS WITH CONSULTANTS After completion of the four interviews, the committee discussed the firms and individual consultants that had participated. The criteria used in the discussion were: - ability to communicate with the committee - credibility established through a demonstrated knowledge of the field (inspiring confidence in their knowledge and ability) - a sensitivity to the needs of the City - professional demeanor of the consultants and quality of the presentation - later reference checks - cost A summary of the evaluations made by the committee of the firms are as follows: 1 . ARMTECH - Too detail oriented; did not relate well to the employee committee and staff as a whole. Made statements that were extremely "pro-management." Presentation was somewhat disjointed and did not inspire professional confidence. Page 4, Item 12 Meeting Date 2/18/86 2. ROBERT DRIVER & COMPANY - The presentation made by the two representatives was somewhat disorganized and did not inspire much professional confidence. The representatives stated that their primary concern was to do the consultant assignment, but to later be chosen Broker of Record for the City' s health insurance coverage. This would make the exceedingly low bid figure realistic as commissions were received at a later date. The representatives stated that Robert Driver & Company is the largest broker for the Travelers Insurance Company in San Diego. The committee felt that this could result in some pressure or the perception that this firm would not have a level of objectivity equal to the other firms. 3. THE EPLER COMPANY - The representative made a very detailed presentation dealing primarily with funding mechanisms for the City's coverage. Overall the presentation was good, but the Police and Fire representatives found this firm unacceptable due to previous working relationships. 4. WARREN, MCVEIGH & GRIFFIN, INC. - The two representatives from Warren, McVeigh & Griffin made the most organized and professional presentation. Their knowledge of the field appeared excellent, they inspired confidence and they were able to communicate well with the employee committee and staff. After the interviews, it was the unanimous opinion of the employee committee and staff that Warren, McVeigh & Griffin was the best qualified firm to evaluate our health insurance bids. Reference checks were conducted by contacting other cities and agencies where Warren, McVeigh & Griffin Inc. and the two individuals that would be assigned from the firm to prepare the analysis of the bids had worked. Both the firm and the individuals come highly recommended for their professional integrity and knowledge in the type of work required. The City of Chula Vista previously contracted with this firm (although not the specific individuals to be used in the assignment) approximately eight years ago when a comprehensive study was conducted of the City' s risk management operation. As a result of that study, the City's present risk management program evolved. Their performance at that time was entirely satisfactory. The employee committee and staff felt all of the four firms considered were qualified to provide the service required, but that Warren, McVeigh and Griffin, Inc. ranked highest in terms of the evaluation criteria. FISCAL IMPACT: The cost of this consulting service will not exceed $5,400 plus an additional $200-$300 out-of-pocket expenses. Funds for this purpose are provided within the City Manager's budget under contractual services. WPC 0481K the Ci k' r; of L Chula Vi � :, i ifornia ted ___4_,ZOilif6 Warren, McVeigh & Griffin, Inc. Risk Management Consultants March 3, 1986 Ms. Jennie M. Fulasz, CMC City Clerk City of Chula Vista 276 Fourth Avenue Chula Vista, California 92010 WARREN, MeVEIGH & GRIFFIN, INC. EMPLOYEE BENEFIT CONSULTING SERVICES TO EVALUATE BIDS FOR HOSPITALIZATION AND MEDICAL INSURANCE Dear Ms. Fulasz: We are returning the original and two copies of the executed document Resolution No. 12382. This document executes an agreement between the City of Chula Vista and Warren, McVeigh & Griffin, Inc. to perform specific employee benefit consulting services as they pertain to the evaluation of hospital and medical insurance competitive bids, as detailed in our proposal of September 10, 1985 and subsequent letter to Ms. Signe Ann Thorsen, Director of Personnel, on December 2, 1985. Our proposal of September 10, 1985 indicated that if the City desires a meeting to discuss our report, we will assess an additional charge of $800, plus out-of-pocket expenses for travel. Since this resolution does not mention this point, we will assume that a meeting to present our report will not be required. However, if it is determined at a later date that such a meeting is required, we will assess the charge as mentioned above. We appreciate the opportunity to be of service to the City. We are prepared to begin this assignment immediately. We will contact Ms. Thorsen within the next few days for instructions. Sincerely, vv , /G. Timothy D. Beck Senior Employee Benefits Consultant cc: Ms. Signe Ann Thorsen, Director of Personnel 1420 Bristol Street North, Newport Beach, California 92660 • (714) 752-1058 Form No. F-229 12/73 CERTIFICATE OF CITY/DIRECTOR OF FINANCE Certification of Unappropriated Balance I HEREBY CERTIFY that the money required for the appropriation of funds for the purpose set forth in the attached resolution is available in the Treasury, or is anticipated to come into the Treasury, and is otherwise unappropriated. Amount $ Fund Purpose Bidder Director of Finance The City of Chula Vista Date By Certification of Unencumbered Balance I HEREBY CERTIFY that the indebtedness and obligation to be incurred by the contract or agreement authorized by the attached resolution can be incurred without the violation of any of the provisions of the Charter of the City of Chula Vista, or the Constitution or the laws of the State of California, that sufficient monies have been appropriated for the purpose of said contract, that sufficient monies to meet the obligations of the contract are actually in the Treasury, or are anticipated to come into the Treasury to the credit of the appropriation from which the same are to be drawn, and that said monies now actually in the Treasury, together with the monies anticipated to come into the Treasury, to the credit of said appropriation are otherwise unencumbered. Amount Not to Exceed $ 5,400.00 � l Director of inance The City of Chula Vista Date 2/18/86 By Personnel Fund 100 Dept./Activity 0210-5201 Purpose Consulting Services for evaluating health insurance bids Bidder Warren, McVeigh and Griffin, Inc. '-;7-8b g Ems' Certificate No. 37 j