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90-20047 ResoRESOLUT'I'ON NO. 90-20047 A RESOLUTION OF THE CITY CO~I{ISSION OF THE CITY OF MIAMI BEACH, FLORIDA, EXTENDING MANAGED C~RE MEDICAL, HMO AND MEDICARE SUPPLEMENT PLANS WITH HUMANA HEALTH CARE PLANS FOR THE FISCAL YEAR 1990/1991; AND AUTHORISING THE MAYOR AND CITY CLERK TO EXECUTE A SERVICE AGREEMENT BETWEEN THE CITY OF MIAMI BEACH AND HUMANA HEALTH CARE PLANS o WdEREAS, invitation to Bid No. 127-89/93 was awarded to Humana Health Care Plans for one year period on July 26, 1989, with the option to renew for up to four additional one year periods; and WHEREAS, the City Administration recommends the extension for a second one year period commencing October 1, 1990, with cost increases in premiums not to exceed 20% for the Managed Care (PPO), 17% for the HMO and 33% for the Medicare supplement Plans; and WHEREAS, Humana's proposed cost increases have been evaluated by TPF&C of Florida, Inc., the City's Benefit Consultant, and found to be reasonable. NOW, THEREFORE, BE IT DULY RESOLVED BY THE CITY COMMISSION OF THE CITY OF MIAMI BEACH as follows: 1) 2) The City Commission hereby extends the Managed Care Medical, HMO and Medicare Supplement Plans with Humana Health Care Plans for the fiscal year 1990/1991. The Mayor and City Clerk are hereby authorized to execute a Service Agreement between the city of Miami Beach and Humana Health Care Plans, a copy of which is attached hereto. ADOPTED this 25th ATTEST: CITY CT.~.RK PNB:lm day of July 1990. Approved as to form by the City Attorney's Office BY :: ~ DAT .: 7//7/;° OFFICE OF THE CITY MANAGER ROB Wo PARKiNS CITY MANAGER FLORIDA 33139 "VACATIONLAND U. S. A." CITY HALL 1700 CONVENTION CENTER DRIVE TELEPHONE: 673-7010 TO: FROM: SUBJECT: COMMISSION MEMORANDUM NO. ~ 0 DATE: July 25, 1990 Members Rob W. Park~ City Manager REQUEST FOR//R~$OLUTION ~PPROVING THE EXTENS/ON OF ~AGED C2~RE MEDICAL, HMO AND MEDICARE SUPPLEMENT PLANS WITH H~ HEALTH CARE PLANS FOR FISCAL YEAR 1990/91 AND AUTHORIZING THE MAYOR/q/gD THE CITY CLERK TO EXECUTE A SERVICE ~GREEMENT WITH HUMAN~ HEALTH CARE PLANS CONTRACT: Invitation to Bid No. 127-89/93 was awarded to Humana Health Care Plans for a one year period on July 26, 1989, with the option to renew for up to four additional one year periods. The City Administration recommends the extension for a second one year period commencing October 1, 1990, with cost increases in premiums not to exceed 20% for the Managed Care (PPO), 17% for the HMO and 33% for the Medicare Supplement Plans. Humana's proposed cost increases have been evaluated by TPF&C of Florida, Inc., the City's Benefit Consultant, and found to be reasonable. Please be advised that a withdrawal by any of the three participating bargaining units from the City-sponsored Humana medical plans to a self-insured medical trust would result in Humana's revaluation of the remaining members' demographic composition at the time of withdrawal. Humana would then request changes in premium rates for the remaining group members for the balance of the Fiscal Year. A Service Agreement between the City of Miami Beach and Humana Health Care Plans has been developed to set forth performance standards for the Humana contracts. A representative from our Benefit Consultant, TPF&C, is present for questions from the Commission. BID ~MOUNT: $5,537,639. $1,154,361. Cost in Fiscal Year 1989/90 for Managed Care (PPO), HMO and Medicare Supplement Plans with Humana Health Care Plans Estimated cost increase in Fiscal Year 1990/91. AGENDA C_ Z.~_b ITEM __, BERV~CE &~REEMENT BETWEEN CITY OF HIAHI BF~CH & HUI~,..I~HE~%LTH C~RE PL~NB (Humana Health Insurance Company of Florida, Inc. and Humana Medical Plan, Inc.) FOR MEDICAL BENEFITS COVERING CITY OF MI~I BEACH EMPLOYEES, RETIREES ~ DEPENDENTS This is an agreement, made and entered into this 25th day of July , 1990, by and between: The City of Miami Beach ("city") AND Humana Health Care Plans and its subsidiaries, Humana Health Insurance Company of Florida, Inc. and Humana Medical Plan, Inc., its successors and assigns ("Humana"). WI~NESSETH, in consideration of the City renewing the Humana Health Care Plans for a one (1) year term and the mutual terms, conditions, promises, covenants and payments hereinafter set forth, the City administration and Humana agree as follows: I. PROVISIONS OF AGREEMENT Open Enrollment/Educational Sessions The City will schedule the annual Open Enrollment sessions at various locations and times, and will notify Humana Account Services at least two weeks prior to the first sessions. From one to three other times during the plan year, educational sessions will be conducted again at various locations and times, as agreed by the City and Humana. HMO and PPO Plans Packets Humana will prepare and distribute by U.S. mail HMO and PPO Plans packets at least two weeks in advance of the commencement of the City's annual Open Enrollment. The City administration will assist in the development of an Open Enrollment announcement to be included in each packet, and review information to be included in the packets in advance of printing and distribution. Mailing labels will be provided by the City. Any packets returned for incorrect address will be given to the City administration to send to the employee or retiree. Provider Directories In addition to the HMO and PPO provider directories distributed at Open Enrollment, Humana shall mail to each o 0 member a new directory or a list of changes to the previous directory not less than once each calendar quarter. Humana will also notify the City administration in writing of additions, changes or deletions which occur in the interim. Humana must honor all claims for deleted providers until the next directory or list of changes is mailed to the members. Each calendar quarter, Humana shall provide a list of providers such as home health care, extended care facilities, durable medical equipment, hospice and other such providers contracted with Humana. Each calendar quarter, Humana shall identify the contracted providers for anesthesiology, pathology, radiology, and emergency physician group at each contracted PPO hospital in South Florida Service Area. Identification Cards For new enrollees and members with plan or coverage changes, including Open Enrollment, Humana will process the enrollment or change no later than three weeks upon receipt by the Humana Billing office in Louisville, Kentucky. The member is responsible for informing the City group insurance section of the Personnel Department. If Humana fails to do so, Humana Account Services must contact providers to arrange for coverage of medical care required. The Account Services representative will be responsible for having the identification card(s) produced and sent to the member. PPO Plan Late Entrants Employees and/or dependent(s) requesting enrollment in the Humana PPO Plan after Open Enrollment has ended or after the 30 day eligibility period will complete the appropriate Enrollment or Change Fo~,, including the Medical Statement. The completed form will be sent by the City to the Humana Billing office for handling. If additional information is required from Humana, the applicant will have a minimum of six weeks from the date of Humana's request to the date postmarked on the envelope returning the information to Humana. Humana Account Services is to keep the City administration advised of the status of late entrant applicants. Claims and Correspondence ResDonse~ Humana agrees to correspond directly with PPO and HMO members regarding the status of any claims submitted which have not been resolved within 30 days of the date of receipt by Humana. The city administration shall notify Humana of post-30 day claims via claims transmittal forms and copies of claims, or the member may provide notice to Humana in writing with a copy of the claim in question attached. Humana shall respond in writing, or verbally with a follow-up in writing, to the member (or the City administration, if the member can not be contacted). Information will include the status of the claims, reasons for any delays, and the name and telephone number for a Humana contact person to receive additional information. Responses shall be received by the member (or the City administration, if the member can not be contacted) within 14 calendar days (which includes return mail time) of Humana's receipt of the request. FAILURE TO COMPLY WILL RESULT IN A $100 PER CALENDAR DAY PENALTY TO BE PAID BY HUMANA UPON WRITTEN NOTIFICATION BY THE CITY TO HUMANA. THE AFFECTED MEMBER WILL RECEIVE ONE-HALF OF THE PENALTY, to be applied by the City to the member's healthcare plan premium deduction. This penalty may be waived only by mutual agreement between the City and Humana. "Threatenin~ Letter" Response~ Any time a PPO or HMO member receives a letter from a PPO or non-PPO provider threatening legal action, referral to a collection agency or other negative action which could jeopardize the member's credit standing because of Humana's delay or failure to pay claims, Humana shall respond, in writing or verbally with a follow-up in writing, to the member and the City administration with an explanation of the status of any claims submitted within the past 30 days. The City administration shall notify Humana of threatening letter via claims transmittal form and copy of all relevant information available. Humana's response shall include the status of the claims, reason for any delays, and the name and telephone number for a Humana contact person to received additional information. Responses shall be received by the member (or the City administration, if the member can not be contacted) within 14 calendar days (which includes return mail time) of Humana's receipt of the request. FAILURE TO COMPLY WILL RESULT IN A $100 PER CAT~NDAR DAY PENALTY TO BE PAID BY HUMANA UPON WRITTEN NOTIFICATION BY THE CITY TO HUMANA. THE AFFECTED MEMBER WILL RECEIVE ONE-HALF OF THE PENALTY, to be applied by the City to the member's healthcare plan premium deduction. This penalty may be waived only on a case-by-case basis, by mutual agreement in writing between the City and Humana. 8. Dedicated Services in Humana To be effective no later than October 1, 1990. a. Humana agrees to process PPO Plan claims for City of Miami Beach members, both employees and retirees, in a claims processing unit dedicated exclusively to 'special' (including Service Agreement) accounts. Humana will maintain experienced staffing in this claims processing unit to insure timely and accurate processing according to plan benefits. b. Humana agrees to place a Service Representative within the City of Miami Beach Personnel Department office on a full-time basis. The representative will be authorized to resolve PPO and HMO problems brought to the Representative to handle. Also, the Representative will have a computer terminal on-line with Humana to provide information upon request regarding claims, enrollment and billing. c. Humana agrees to provide ready access to a Utilization Specialist to assist HMO and PPO members with medical issues including PPO prior authorizations, PPO pre-admission certifications, PPO length of stay issues and discharge planning; HMO referrals, access to HMO primary care physicians, and obtaining authorizations for emergency and outpatient care. Telephone access for employees and retirees is required. HMO and PPO Plans - Changes in Benefit~ When Humana unilaterally changes a plan benefit, the City administration shall be notified at least 60 days prior to the proposed effective date of the change. Ail major changes must be agreed to by the City administration at least 30 days prior to the actual implementation date. Ail plan members must be notified by announcement mailed to their home addresses at least 15 days prior to implementation, once such change has been agreed to by the City administration. FAILURE TO COMPLY WILL RESULT IN A $100 PENALTY PER MEMBER ADVERSELY AFFECTED, TO BE PAID BY HUMANA UPON WRITTEN NOTIFICATION BY THE CITY TO HUMANA. EACH AFFECTED MEMBER WILL RECEIVE ONE-HALF OF THE PENALTY, to be applied by the City to the member's healthcare plan premium deduction. ALSO, AN EXCEPTION WILL BE REQUESTED AND APPROVED TO PROVIDE THE BENEFIT AT THE PREVIOUS LEVEL UNTIL THE CHANGE IS APPROVED BY THE CITY ADMINISTRATION AND NOTIFICATION PROVIDED TO THE PLAN MEMBERS. Past examples of such failures include the failure to inform HMO members of vision care benefit changes, PPO members of Biodyne's involvement, and the PPO Plan's Prior Authorization implementation. 10. HMO Plan Physician ADDointments Humana guarantees that all "emergency" medical care required by covered City members will be available within 24 hours of notification by the covered member or his representative (i.e. family member, friend, hospital or other provider) to one of the following Humana offices: Preadmission Review/Prior Authorization in Louisville, Kentucky at (800) 523-0023; Customer Services at Miami, Florida at (800) 521-4882 or (305) 623-2400; or the member's primary care physician office or, if after office hours, the physician's answering service. Further, Humana guarantees that each covered City member requiring "urgent" medical care due to illness or injury (but not considered an "emergency") will be able to secure an appointment and have treatment provided by a Primary Care Physician or, if deemed medically necessary (and authorized by the patient's HMO Center), a specialist within 72 hours (including weekends and/or observed Federal holidays) of notification by the covered member or his representative (i.e. family member, friend, or a City Group Insurance representative). Notification shall be to the member's Humana primary care Physician's office or, if after hours, the physician's answering service; or Customer Services in Miami, Florida at (800) 521-4882 or (305) 623-2400. FAILURE TO COMPLY WILL RESULT IN A $100 PER CALENDAR DAY PENALTY TO BE PAID BY HUMANA UPON WRITTEN NOTIFICATION BY THE CITY TO HUMANA. THE AFFECTED MEMBER WILL RECEIVE ONE-HALF OF THE PENALTY, to be applied by the City to the member's healthcare plan premium deduction. ALSO, AN EXCEPTION WILL BE REQUESTED BY THE CITY AND APPROVED BY HUMANA TO PROVIDE PLAN BENEFITS FOR THE FOLLOWING: (a) ONE EMERGENCY ROOM OR OFFICE VISIT (INCLUDING MEDICALLY NECESSARY SERVICES SUCH AS TESTS AND/OR PROCEDURES) FOR "EMERGENCY" SERVICES INCURRED BY THE MEMBER IF "EMERGENCY" SERVICES WERE NOT AVAILABTm BY THE END OF THE 24 HOUR 5 PERIOD. HUMANA'S PENALTY LIMITED TO $100 (ONE [1] DaY). WOULD BE CALENDAR (b) ONE OFFICE VISIT FOR "URGENT" SERVICES (INCLUDING MEDICALLY NECESSARY SERVICES SUCH AS TESTS AND/OR PROCEDURES) INCURRED BY THE MEMBER IF "URGENT" SERVICES WERE NOT PROVIDED BY THE END OF THE 72 HOUR PERIOD. HUMANA'S PENALTY WOULD BE LIMITED TO $100 (ONE [1] CALENDAR DAY). Humana agrees that any covered City member requiring specialty care shall be referred to an appropriate specialist and have treatment provided within two (2) weeks of the Primary Care Physician visit if the patient's health and well-being would be compromised by a delay in specialty care beyond the two (2) week period. Otherwise, specialty care shall be provided within four (4) weeks of the Primary Care Physician visit. If an appropriate specialist is not contracted by the patient's HMO Center, Humana shall arrange for treatment to be provided within the timeframes and guidelines set forth above in this paragraph. FAILURE TO COMPLY WILL RESULT IN A $100 PER CAT~NDAR DAY PENALTY (UNTIL IN COMPLIANCE OR AS NOTED BELOW), TO BE PAID BY HUMANA UPON WRITTEN NOTIFICATION BY THE CITY TO HUMANA. THE AFFECTED MEMBER WILL RECEIVE ONE-HALF OF THE PENALTY, to be applied by the City to the member's healthcare plan premium deduction. ALSO, AN EXCEPTION WILL BE REQUESTED BY THE CITYAND APPROVED BY HUMANA TO PROVIDE PLAN BENEFITS FOR THE FOLLOWING: (a) ONE OFFICE VISIT FOR SPECIALTY SERVICES (INCLUDING MEDICALLY NECESSARY SERVICES SUCH AS TESTS AND/OR PROCEDURES) INCURRED BY THE MEMBER IF SPECIALTY SERVICES WERE NOT PROVIDED BY THE END OF THE TWO (2) WEEK PERIOD, IF THE PATIENT'S HEALTH AND WELL-BEING WOULD BE COMPROMISED BY A FURTHER DELAY. HUMANA'S PENALTY WOULD BE LIMITED TO $100 TIMES THE NUMBER OF CALENDAR DAYS FROM THE END OF THE TWO (2) WEEK PERIOD UNTIL THE DATE OF THE SPECIALTY VISIT. 6 (b) ONE OFFICE VISIT FOR SPECIALTY SERVICES (INCLUDING MEDICALLY NECESSARY SERVICES SUCH AS TESTS AND/OR PROCEDURES) INCURRED BY THE MEMBER IF SPECIALTY SERVICES WERE NOT PROVIDED BY THE END OF THE FOUR (4) WEEK PERIOD. HUMANA'S PENALTY WOULD BE LIMITED TO $100 TIMES THE NUMBER OF CA?mNDAR DAYS FROM THE END OF THE FOUR (4) WEEK PERIOD UNTIL THE DATE OF THE SPECIALTY VISIT. II. TERM OF AGREEMENT This Agreement shall commence on October 1, 1990 and terminate September 30, 1991. The City administration and Humana have the option to renew this Agreement annually upon mutual consent. III. PERFORMANCE OF SERVICE NOTIFICATION Humana shall receive notices regarding perfozmance of service addressed to the following: Debra Rollins, Account Services Manager Humana Health Care Plans 1505 N.W. 167th Street Miami, Florida 33169 Telephone: (305) 623-5664 The City administration shall receive notices regarding performance of service addressed to the following: Lyn Schuler, Employee Benefits Coordinator Personnel Department City of Miami Beach 1700 Convention Center Drive Miami Beach, FL 33139 Telephone: (305) 673-7526 IV. PAYMENT OF PENALTIES Any time penalties are incurred by Humana pursuant to the terms of the Agreement, the City administration will submit a written invoice to Humana detailing the dates, City member names, identification numbers and alleged performance failures. Humana must agree to or dispute these penalties within 20 days of receipt. If Humana agrees that the penalty is justified, Humana will acknowledge the penalty and inform the City administration in writing within 10 days of the decision. Humana will pay these agreed-to penalty amounts to the City administration within the following 30 days. If Humana does not agree that the penalty is justified, Humana will inform the City administration in writing within 10 days of the decision. A meeting between the City administration and Humana will be held within 30 days to resolve the alleged penalty through negotiations. V. ENTIRE ~,(~REF~ENT Ail provisions contained within this Agreement, the City of Miami Beach Invitation to Bid No. 122-88/93, Humana's Bid Response, and renewal negotiations for October 1, 1990, represent all the terms and conditions agreed to by the City administration and Humana. In the event of a discrepancy between these documents, the order of priority of the documents shall be as follows: This Agreement Correspondence related to 10/1/90 Plan Renewal Humana's Bid Response City of Miami Beach Invitation to Bid No. 122-88/93 The City administration and Humana recognize that in order to comply with applicable state laws that Humana must file a document with the State of Florida Department of Insurance setting forth the benefits and coverage to be provided by Humana under the tezms of this Agreement, Humana's Bid Response and City of Miami Beach Invitation to Bid No. 122-88/93. The City administration and Humana acknowledge that the document to be provided to the state is not a full and accurate representation of the terms and conditions as set forth in this Agreement, City of Miami Beach Invitation to Bid No. 122-88/93 and Humana's Bid Response. IN WITNESS WHEREOF, the parties have made and executed this Agreement on the respective dates under each signature: CITY OF MI/%MI BEACH Attest: Approved as to form by the City Attorney's Office H]IMANA HEALTH C~RE PLANS (CORPORATE SEAL) (CORPORATE SEAL) HUMANA HEALTH INSURANCE COMPANY OF FL, INC. HUMAN~ PLAN, INC. Name and ~tle DATE: /4.~ F .~ o