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2011-128-1521 - Agreement with Avmed City of Miami Gardens Agenda Cover Memo Council Meeting Date: July 27, 2011 Item Type: (Enter X in box) Resolution Ordinance Other X Fiscal Impact: (Enter X in box) Yes No Ordinance Reading: (Enter X in box) 1st Reading 2nd Reading X Public Hearing: (Enter X in box) Yes No Yes No X Funding Source: Various Funds Advertising Requirement: (Enter X in box) Yes No X Contract/P.O. Required: (Enter X in box) Yes No RFP/RFQ/Bid #: RFP #0506015 Renewal Medical InsuranceAvMed Health Plans X Strategic Plan Related (Enter X in box) Yes No Strategic Plan Priority Area: Enhance Organizational Bus. & Economic Dev Public Safety Quality of Education Qual. of Life & City Image Communcation Strategic Plan Obj./Strategy: (list the specific objective/strategy this item will address) N/A X Sponsor Name Dr. Danny O. Crew, City Manager Department: Human Resources Department Short Title: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MIAMI GARDENS, FLORIDA, AUTHORIZING THE CITY MANAGER AND CITY CLERK TO EXECUTE AND ATTEST RESPECTIVELY, THAT CERTAIN RENEWAL AGREEMENT WITH AVMED HEALTH PLANS FOR MEDICAL INSURANCE IN THE AMOUNT OF FOUR MILLION THREE HUNDRED SIXTY‐SEVEN THOUSAND SIX HUNDRED FIFTY‐TWO DOLLARS ($4,367,652.00), A COPY OF WHICH IS ATTACHED HERETO AS EXHIBIT “A”; PROVIDING FOR INSTRUCTIONS TO THE CITY CLERK; PROVIDING FOR THE ADOPTION OF REPRESENTATIONS; PROVIDING FOR AN EFFECTIVE DATE. Staff Summary: Background On October 11, 2006, the City Council authorized the City Manager to negotiate and execute agreements with annual renewal options for medical, dental, vision, flexible spending, and life coverage for employees and council members. At that time, medical insurance was awarded to AvMed Health Plans. Currently, AvMed contracts with the City for medical insurance in the amount of $3,978,518. ITEM K-5) CONSENT AGENDA RESOLUTION Renewal Agreement w/AVMED 1515 NW 167 Street, Building 5 Suite 200 Miami Gardens, Florida 33169 In preparation for next year’s benefits selection, the City’s agent of record, McKinley Financial Services, Inc. and staff reviewed a proposed 11.8% renewal rate increase initially offered by AvMed. Through several discussions, the Human Resources Department was able to negotiate a reduced rate increase of 9.8% for the HMO plan and 9.9% for the POS plan, making the total cost of health insurance $4,367,652 in FY 12. This represents an increase of $389,134 in the upcoming fiscal year. The nation’s health care cost is projected to increase by 11%. The Renewal notice attached as Exhibit A. Proposed Action: That the City Council approve the attached resolution authorizing the City Manager and the City Attorney to negotiate and execute a contract renewal with AvMed Health Plans in the amount of $4,367,652. Attachment: Exhibit A: AvMed Medical Financial Analysis