The search for a viable insurance plan for city of Indianola employees continued during a special call meeting on June 10, but even after the session, which lasted an hour and a half, no conclusive decision was made.
The city lawmakers needed to agree on a feasible plan and a carrier before a June 15 deadline. That meeting ended with a call for an additional meeting on Friday the 12th.
Coming into the special meeting on the 10th, the board had pretty much settled on Blue Cross Blue Shield as their carrier because their agent and broker had apparently told them that no other insurance provider would take them because of consistent high loss ratios,
Alderman Marvin Elder made a motion at their June 8 meeting to hold a special session to hear a proposal from a different company.
Elder invited Hunter Hollingsworth, a representative from Tennessee-based Collier Insurance, to make a presentation to the aldermen before they decide to go with either of the plans presented by Blue Cross Blue Shield.
At that session, Hollingsworth mainly put in a bid for his company to become the new insurance broker for the city. He presented several alternatives that suggested that the city had more options than those provided by BCBS and insinuated that the city's current broker was not properly servicing them.
Hollingsworth told the city leaders that on their behalf he had already contacted Humana, Aetna, UnitedHealthcare and Blue Cross Blue Shield insurance groups and found out that only BCBS had been previously contacted to provide a quote.
"Right now, you are just not being taken out to market because you're represented by Blue Cross Blue Shield. You are at the mercy of Blue Cross Blue Shield," Hollingsworth said.
He told Mayor Steve Rosenthal and the Aldermen that if he/Collier Insurance was their broker he would have asked each of the aforementioned insurers for a quote.
"Because these people are going to quote me. They might not want to write me, but they'll quote you," he said.
Based on previous declarations that no other insurance company would offer coverage to the city, Alderman Ruben Woods asked Rosenthal about the source of that information.
"Seems like somebody dropped the ball,” Woods said.
Rosenthal had antecedently stated that in the past two years BCBS had operated at a loss in its coverage of the city.
"Last year they had 130 percent loss and this year they had a 145 percent loss," said Rosenthal.
Rosenthal alluded to the city's broker Lee Rogers being one of the sources for the information.
He explained that Rogers' job was to go out and get unbiased quotes and that he does not receive a commission.
Woods wanted to know, "Did he do his homework this time? We are being told that nobody wanted to write us, but if nobody knows that we are soliciting anything, nobody's going to write us."
Rosenthal admitted that he did not enlist Rogers to solicit quotes for the current year.
"With this increase, I didn't bring Lee on board this year. Last year Lee solicited all of these people to see if anybody would quote us," Rosenthal said.
He then asked Rogers to confirm which prospective insurance carriers he had talked to last year and Rogers replied, "I had no hopes of making a possibility, so I didn't market you last year at a 130 percent loss."
Rosenthal explained, “Well, nobody took us on last year at 130 percent loss." He further stated that he assumed that no one would want to take on the city at a 145 percent loss. Woods asserted that to be a lack of transparency. "You're just assuming Mayor,we've got to be more transparent, you're not being transparent at all."
Rosenthal then asked Hollingsworth how many times he's had a group with the substantial loss, experienced by the city, get a less expensive quote from a company.
"They take them on every time," Hollingsworth said, "It's because I work for a family that has been in business for 110 years."
Rogers responded, “That's mildly impressive Hunter (Hollingsworth), but not material."
Addressing Rosenthal, Hollingsworth said that if the city was his client, it would have never gotten to a 145 percent loss ratio.
"Because once you become a client of mine, I'm going to put a contract in that is going to cap your loss so you're not going to hit those numbers," he said.
Rogers supposed that Hollingsworth was talking about repricing the drug cost and suggested that if that was his option, then BlueCross BlueShield was already doing that.
"And we are at this position after they have finished repricing the drugs," Rogers said.
Elder, acknowledging the statements from Rogers and others, said the city leaders should have still been getting quotes from insurance carriers and they have not been getting them.
"If we got them, we never saw them," Elder said.
“Whether they're good or bad (quotes) you still need to see what the market says about your group,” Hollingsworth said.
Rosenthal then asked Rogers who all the city had received quotes from and Rogers replied,
"Steve, I haven't found anybody that wants to handle a less than 100 lives group and with the experience that yours has."
Although he offered no guarantees, in his effort to show how he could better serve them, Hollingsworth said the city could save 20% by extracting certain employees off of certain contracts.
Alderman Darrell Simpson questioned how that could be done and Hollingsworth told him it would be done by way of a speculative deductible being raised up higher than anyone else's. He explained that it had to do with the way the insurance contracts were written.
Rogers maintained that the city didn't have enough people to make Hollingsworth's proposition work; however, Hollingsworth asserted that he did have a way to do it.
Simpson questioned the legality of it because it sounded as if they would be offering different coverage to individual workers. However, Hollingsworth reassured him that they would be offering each employee the same coverage and that the only difference was in how the claims are negotiated and paid.
Although he mentioned several providers, Hollingsworth seemed to express some partiality towards UnitedHealthcare.
Rosenthal asked Rogers if he had made any contact with UnitedHealthcare. "No, I have not,” Rodger said.
Rosenthal said, "I do have a problem with UnitedHealthcare, I know our hospital and clinic does not really work with UnitedHealthcare."
He stated that although he is aware that UnitedHealthcare is big across the rest of the country nobody in this area wants to use them.
Hollingsworth explained the benefits of using UnitedHealthcare and his insurance company to handle their pharmaceutical plan and more. He asked the aldermen if they had ever received a decrease in premiums from Blue Cross Blue Shield and Rosenthal explained that they have in years past, but not with the current board of aldermen.
Hollingsworth continued to tout the quality of services and the savings that his company and their partners could provide and Elder queried him about adding vision and dental insurance and asked if he thought it was a good idea.
"That's a stupid question, because he's a salesman," Rosenthal said.
Elder disagreed and recommended at least seeing the quotes that Hollingsworth said he had acquired.
Rosenthal then cautioned that even if Hollingsworth could provide a 20% discount that would be eaten up by adding additional coverage and their goal was to reduce the amount of out pay by the city and employees. Hollingsworth added that the coverage was strictly voluntary and that the employees would have to pay for it.
Hollingsworth again mentioned the possible savings available through UnitedHealthcare.
"We don't want UnitedHealthcare, don't keep saying that, our local people will not take it,” said Rosenthal.
“Well, if they came in at less than 10% decrease from what you're currently at would you accept them?” Hollingsworth asked.
Rosenthal indicated that the employees may be okay with his projections, but not the local hospital.
"The only place that takes it around here is in Mound Bayou," Rosenthal said.
When queried about which local hospitals he was referring to as not taking UnitedHealthcare, Rosenthal said, North Sunflower Medical Center and South Sunflower County Hospital. He said they would prefer not to take it.
Rosenthal said he was thinking about the employees going to the doctor and getting charged out of network for every visit.
"We're messing them over," he said.
Elder then asked Hollingsworth if he could build a network based on the clinics and hospitals in this area and he assured Elder that their network was already established.
Rosenthal asserted, "I'm telling you my ex-wife runs the clinic, my son runs the computer system at the hospital and I can tell you how few get approved through UnitedHealthcare, at our hospital and our local clinic."
Rosenthal added, "My concern is if we don't go on Blue Cross and we change up and then we find out that we don't have a savings or we got a company that no doctor wants to accept because that's basically what we have here with UnitedHealthcare. They will take them, but everybody sitting out in the waiting room has got UnitedHealthcare and all of our Blue Cross Blue Shield employees have seen the doctor and is already back at work."
Rosenthal said he was also concerned that if they drop Blue Cross Blue Shield and have to go back that the company would not take them back. "Because our only reason they've kept us is because of the relationship they have with our local facilities, otherwise they would have dropped us a long time ago," he said.
Hollingsworth responded, "I will tell you this, you may have answered your question of why the local hospital sees the Blue Cross Blue Shield patients before they see the UnitedHealthcare patient and that's because the local hospital and Blue Cross Blue Shield are in cahoots with each other and they know that they are making more money off of your employees because they have a Blue Cross Blue Shield fully-insured plan than they would be off of a Collier plan that may be self-funded through UnitedHealthcare.”
Hollingsworth then mentioned direct contracts and said some people have direct contracts with certain facilities.
Rosenthal said his problem with UnitedHealthcare has been the way they pay and that they are slow about paying. Hollingsworth said that UnitedHealthcare would not be the one responsible for paying the claims because he uses an independent third-party administrator to pay the claims and it's done within seven days.
To further establish his case, Hollingsworth alluded to things the city's current broker should have done, but did not do and said,
"So explain to me how they are working for you. I've been working for you for the last 10 days harder than your broker has worked for you in the last year,” Hollingsworth said.
He said the city's health plan needs structure and contracts that are solidified.
Simpson emphasized that what the city was looking at is coverage and cost. He wanted to know bottom-line on what the coverage would cost the city annually.
He said even the lowest-cost option of the three plans they had been considering would take a huge chunk out of the city's budget.
"Even option three will represent 35% total budget of the city of Indianola, just in health insurance $777,000," he said.
Hollingsworth said, “I can't answer that for you because right now you have no decision.” He told the aldermen that when he gets their claims data he can go into the market and get them a firm rate.
Hollingsworth asserted that he has already asked for the quotes and the companies won't give them without him being named their broker of record. However, Rosenthal insisted, “He has 100% of what he needs to get quotes.”
Hollingsworth responded, "With what I have, I can get quotes, but that's not what I'm here to do, I'm not here to quote 7-1, I'm here to become your broker,” Hollingsworth said.
Rogers laughed and said, "Well, you're jumping the gun."
The end result was a proposition that suggested temporarily continuing with Blue Cross Blue Shield and a timeline that reflects an October 1 switch if Hollingsworth can find a better plan.
"We have a timeline walking forward from today, moving forward that's with Blue Cross temporarily, it is, it has to be, and that's actually with the Gulf Guaranty with your secondary plan and Blue Cross,” said Hollingsworth.
Alderman Gary Fratesi made the suggestion to give Hollingsworth the opportunity to prove what he can do. Hollingsworth advised the city officials to go directly to Blue Cross Blue Shield and request a quote. He said that even with their present contracts they would receive a savings.
“It's going to look like probably 45 days until we get enough to shop it to the market. You'll see in my timeline, the goal would be to have it, what the numbers would look like for a 10-1 move or at least to have that option," Hollingsworth said.
He emphasized that the city should have started earlier in seeking quotes from other companies and Rosenthal stressed that the city leaders have known about the increase for more than 45 days.
Elder wanted to go ahead and make Hollingsworth the broker of record that night, but the other lawmakers declined.