City Manager Paul Sabiston, in an email to rrspin.com, responded to the insurance matter from Tuesday night's city council meeting.
With exception of edits for style changes, the response is running as sent.
"First, in the packets to City Council for the Special Meeting I placed a short memo (dated 5-23-11) regarding the health insurance quotes that indicted that the Mayor had requested additional quotes from First Carolina Care (for 70/30 and 60/40 coverage) so that when the City Council considered the quotes it could make an 'apples to apples' comparison.
"You may recall that the original RFP only called for quotes on 80/20 coverage with a $2,500 deductible. Both respondents provided that, and First Carolina Agency (Blue Cross and Blue Shield) also provided 70/30, 60/40 and a combined-coverage quote.
"Second, following the meeting with the employee committee last Thursday, the Mayor simply asked for additional information so that when the City Council met it could make a fair comparison.
"It was a good idea and that is what I provided in the memo I gave to the City Council before the meeting. The additional 80/20 'sloped rate' from FCC also was provided to City Council so that it could make a fair comparison to the 80/20 'sloped rate' of BCBS.
"Although I reviewed all the new quotes, I may not have pointed out, and perhaps I should have, the additional 80/20 sloped rate quote from FCC. Neither that quote nor the 80/20 sloped rate from BCBS seemed to be in consideration by the City Council.
"Also, it seemed clear to me that any quotes that the City Council did not have in their original packet were additional quotes from FCC, including the 80/20 sloped rate.
"Third, my recommendation, as set forth in the memo, was for the original 80/20 'unsloped rate' from FCC that the City Council received at the beginning of this process, which was approximately $68,000 less than the BCBS 60/40 quote using the 'total premium' analysis. "The City Council chose to go with the 60/40 sloped rate with BCBS. I have always used the 'total premium' as the guiding light for analyzing health insurance bids and that was pointed out in all of my memos to the City Council.
"This, again, is because the client (i.e., the City) is able to reslope the 'total premium' between city-paid and employee-paid rates to meet its needs but has very limited if any ability to change the actual 'total premium' without changing the nature of the coverage."
