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2001-24336 RESO RESOLUTION NO. 2001-24336 A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA ACCEPTING THE RECOMMENDATIONS OF THE CITY MANAGER AND AUTHORIZING THE ADMINISTRATION TO ENTER INTO NEGOTIATIONS AND, IF SUCCESSFUL, AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE A CONTRACT WITH THE MOST QUALIFIED FIRM OF ARTHUR J. GALLAGHER AND CO., PURSUANT TO REQUEST FOR QUALIFICATIONS (RFQ) NO. 11-00/01 FOR BROKER/AGENT SERVICES TO PROVIDE ASSISTANCE IN DETERMINING THE CITY'S GROUP MEDICAL INSURANCE NEEDS, WITH AN ESTIMATED ANNUAL FEE FOR THE FIRST YEAR NOT TO EXCEED $30,000 IF THE CITY CONTINUES GROUP MEDICAL INSURANCE WITH HUMANA, OR AN ESTIMATED ANNUAL COMMISSION NOT TO EXCEED $200,000 IF THE CITY OBTAINS GROUP MEDICAL INSURANCE FROM OTHER SOURCES; WITH OPTIONS TO RENEW FOR THREE YEARS; SHOULD THE ADMINISTRATION BE UNABLE TO REACH AGREEMENT WITH ARTHUR J. GALLAGHER AND CO., AUTHORIZING THE ADMINISTRATION TO ENTER INTO NEGOTIATIONS WITH THE SECOND MOST QUALIFIED FIRM OF MORRIS AND REYNOLDS INSURANCE. WHEREAS, the City issued Request for Qualifications (RFQ) No.1 1-00/01 for Broker/Agent Services to provide assistance in determining the City's Group Medical Insurance needs; and WHEREAS, forty one (41) specifications packages for RFQ No. 11-00/01 were issued, resulting in the receipt of seven (7) responsive proposals; and WHEREAS, an Evaluation Committee recommended by the City Manager met on April 12, 200 I, and recommended the firm of Arthur J. Gallagher and Co., as the most qualified firm, and the firm of Morris and Reynolds Insurance, as the second most qualified firm; and WHEREAS, the City Manager has reviewed the responses and recommendation of the Evaluation Committee, and concurs with the Evaluation Committee's recommendation. NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND THE CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City Commission hereby authorize the Administration to enter into negotiations and, if successful, authorize the Mayor and City Clerk to execute a contract wit the most qualified firm of Arthur J. Gallagher and Co., pursuant to Request for Qualifications (RFQ) No. 11-00/01 for Broker/Agent Services to Provide Assistance in Determining the City's Group Medical Insurance Needs, with an estimated annual fee for the first year not to exceed $30,000 if the City continues Group Medical Insurance with Humana, for an estimated annual commission not to exceed $200,000 if the City obtains Group Medical Insurance from other sources; with options to renew for three years; should the Administration be unable to reach agreement with Arthur J. Gallagher and Co., authorizing the Administration to enter into negotiations wit the second most qualified firm of Morris and Reynolds Insurance. ADOPTED this 18th day of April 1f Mayor ~o PtW~ City lerk APPROVED f>S 10 fORM & LANGUAGE .. FOR EXECUTION 1f.(/~ '1-1';-0 I C' MoriYtIf ~ AGENTIBROKER PROPOSAL ANALYSIS SUMMARY for THE CITY OF MIAMI BEACH Prepared by SIVER INSURANCE CONSULT ANTS SIVER RECOMMENDATION Based on our initial evaluation ofthe seven agentslbrokers submitting proposals in response to RFQ NO. 11-00/01, Siver recommends approaching Gallagher, McKinley, and Morris & Reynolds regarding participation in Finalist Presentations. We recommend The City provide each finalist with a list of specific issues to cover during their presentation, as well as a list of any sample materials The City would like to review. Finalists should be given a scheduled presentation time, with an indication of the time allotted for review of the specified items and any additional comments the agentlbroker wishes to make. Following their presentation, the agentlbroker would be subject to a brief question and answer session. Siver has been asked to prepare a preliminary list of questions, as well as a list of items to be covered during the finalist presentations. Those lists are provided for your review and are attached to this reDort. ANALYSIS PROCESS Copies of all proposals received in response to RFQ NO. 11-00/01 were provided to Siver for review and analysis. Seven agentslbrokers responded with proposals. As indicated by the attached spreadsheets, we compared each of the seven proposals on the basis of criteria identified in the RFQ. We believe a thorough understanding of issues relative to public sector entities and limitations imposed by the Florida Statutes on such entities is imperative. During this initial analysis phase, we determined that two proposals did not indicate any Florida Governmental Clients and/or Projects, Those two proposals were eliminated from further consideration. Since the RFQ did not require pricing as part of the criteria, we were unable to evaluate the value associated with the services outlined in each proposal. Before finalist presentations begin, discussions should be held to determine how The City intends to compensate an agentlbroker if, in the final analysis, it is determined that The City is best served by keeping the incumbent carrier for the group health plan. Finalists should come to the Presentation meetings prepared to discuss their expected fees and/or commissions whether The City elects to continue coverage with Humana, or ultimately selects an alternate vendor. 1 SIVER IN~'VRANCE CONSULTANTS With pricing eliminated as a method by which we might further measure the value of each proposer, we moved to client references. We first contacted Florida Governmental clients and then, if necessary, moved to non-governmental entities, with three reference checks completed for each of the five remaining proposers. In the course of those inquiries, we found that one of the proposers has only one full-time employee on location, the owner. It is our be!iefthat The City's account is fairly complex and, as such, may frequently require time and resources not typically available in a one-man firm. Therefore, the applicable proposal was eliminated from further consideration. The overall proposal, combined with client reference data, led us to eliminate one additional proposal from consideration. The three proposals (shown in alphabetical order) remaining for consideration were submitted by: ~ Arthur J. Gallagher & Co. (Gallagher) ~ McKinley Financial Services, Inc. ~ Morris & Reynolds Insurance (Morris & Reynolds) All three of the above organizations indicate experience in the type of project outlined in The City's RFQ, as well as Florida Public Sector experience, Multiple full-time employees are located at the designated office site to assist The City with on-going issues. Client references supported their involvement with Florida Public entities on projects similar in nature to that indicated by The City of Miami Beach. Assuming the Committee concurs with our assessment, we recommend contacting the representative for each of these three proposals, in writing, as soon as feasible. A typical finalist presentation is limited to a 30-minute presentation by the agentlbroker, with a 15 to 30-minute question and answer period to follow. Weare available to meet with the appropriate staff to discuss our initial impressions and the steps necessary to proceed with selection ofa broker/agent, As indicated prior to the onset of this project, Siver provides Consulting Services and does not act as legal counsel for The City. We recommend that The City contact their attorney, if not previously consulted, to confirm that this process is not in conflict with Florida Statute 287,057. Respectfully Submitted on March 26, 200 I by: SIVER INSURANCE CONSULTANTS -I, {' 7] fy:,",1 /OU.lt!/i: 4'(. /:: "l(j-L Brenda M. Sadler Vice President l:\EWBUOO I\MBIElAGENTREV,doc 2 ~ ~ ~ '" z o u '" u ~ '" ::> '" ~ '" ~ ri5 CI} r.il ~ ~ r.il CI} =e-o"- Uz&: <r.il<; r.il~:E ~~;:!; ;:!;r.il::J ;:S~CI} ;:!;o~ r..~CI} 0=0 ......llo.. e-o-o ~ecc ugllo.. , - - o z ~ en - I-< en ::> ~ U U ..... =~.. e c: ~ >>0- .. .- llo.. 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'" >< Ul '" >< o Z ~ ~ ~ "' ~ ~ CI ~ ~ j I ~ !!l .. .. '" >< ... .:!J <<i c l.t: CITY OF MIAMI BEACH CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH, FLORIDA 33139 http:\\ci,miaml-beach,fl,us COMMISSION MEMORANDUM NO. ~~o.{)1 TO: Mayor Neisen O. Kasdin and Members of the City Commission DATE: April 18, 2001 FROM: o~ A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA ACCEPTING THE RECOMMENDATIONS OF THE CITY MANAGER AND AUTHORIZING THE ADMINISTRATION TO ENTER INTO NEGOTIATIONS AND, IF SUCCESSFUL, AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE A CONTRACT WITH THE MOST QUALIFIED FIRM OF ARTHUR J. GALLAGHER AND CO., PURSUANT TO REQUEST FOR QUALIFICATIONS (RFQ) NO. 11-00/01 FOR BROKER/AGENT SERVICES TO PROVIDE ASSISTANCE IN DETERMINING THE CITY'S GROUP MEDICAL INSURANCE NEEDS, WITH AN ESTIMATED ANNUAL FEE FOR THE FIRST YEAR NOT TO EXCEED $30,000 IF THE CITY CONTINUES GROUP MEDICAL INSURANCE WITH HUMANA, OR AN ESTIMATED ANNUAL COMMISSION NOT TO EXCEED $200,000 IF THE CITY OBTAINS GROUP MEDICAL INSURANCE FROM OTHER SOURCES; WITH OPTIONS TO RENEW FOR THREE YEARS; SHOULD THE ADMINISTRATION BE UNABLE TO REACH AGREEMENT WITH ARTHUR J. GALLAGHER AND CO., AUTHORIZING THE ADMINISTRATION TO ENTER INTO NEGOTIATIONS WITH THE SECOND MOST QUALIFIED FIRM OF MORRIS AND REYNOLDS INSURANCE. Jorge M. Gonzalez City Manager SUBJECT: ADMINISTRATION RECOMMENDATION Adopt the Resolution. FUNDING: Funds for the initial fee are available from Account Number 540.1790.000312. In the event that the City obtains Group Medical Insurance from sources other than Humana, all fees will be paid as commission from the insurance provider. AGENDA ITEM C7R 4-/f-ol DATE ANALYSIS On November 29, 2000, the Mayor and City Commission authorized the Administration to issue a Request for Qualifications (RFQ) for Broker/ Agent Services to provide assistance in determining the City's Group Medical Insurance needs. A Request for Qualifications was issued on January 3, 2001, with an opening date of February 28, 2001. Forty one (41) specifications were issued, resulting in the receipt of proposals from the following seven (7) firms: Sapoznik & Citrin Robert J. Shafer & Associates, Inc. Roger J. Huxman Ronald G. Stonel The Comprehensive Co. McKinley Financial Services, Inc. Arthur J. Gallagher and Co. Morris & Reynolds Insurance The City Manager appointed the following individuals to serve on the Evaluation Committee: Mary Greenwood, Executive Assistant to the City Manager/Labor Relations. Clifton Leonard, Risk Manager. Drew Terpak, Fleet Management Director. Richard McKinnon, CW A President. John Wheeler, ASME President. Robin Garber, GSAF Representative. Buddy Dresner, Retired City employee. Roberto Sanchez, Health Care Consultant and resident of Miami-Dade County. Bruce Davidson, member of the Budget Advisory Committee. J. D. Weithom, member of the Budget Advisory Committee. Marc Jacobson, member of the Budget Advisory Committee. Phyllis Miler, resident of the City of Miami Beach. The Evaluation Committee met on March 16, 2001 for the purpose of obtaining copies of the responses, review of the evaluation process, review of the "Cone of Silence" and to determine if there were any conflicts regarding the Evaluation Committee participants. At that time, the Committee agreed to meet again on March 26,2001 to review and discuss all proposals. During the meeting, the following individuals were recused from the Evaluation Committee due to various conflicts: Clifton Leonard, Risk Manager Drew Terpak, Fleet Management Director Richard McKinnon, CW A President Roberto Sanchez, Health Care Consultant The Evaluation Committee met again on March 26, 200 I. At that time, the Committee reviewed all proposals and the evaluation provided by the City's Consultant (copy attached). Based on the review of the firm's responses and the analysis provided by the City's Consultant, the Committee determined that the following firms did not meet the minimum requirements and/or did not exhibit sufficient specific and overall expertise relative to the scope of services. Sapoznik & Citrin Robert 1. Shafer & Associates, Inc. Roger J. Huxman Ronald G. Stone/ The Comprehensive Co. McKinley Financial Services, Inc. The Evaluation Committee agreed at that time to request presentations from the firms of Arthur J. Gallagher and Co., and Morris and Reynolds Insurance. The Evaluation Committee felt that both firms were fully qualified to provide the required services. The Evaluation Committee met on April 12,2001 with both Arthur J. Gallagher and Co., and Morris and Reynolds Insurance for presentations. After the presentations, the Evaluation Committee met to complete the selection process. The Evaluation Committee selected Arthur J. Gallagher and Co., as the most qualified, with Morris and Reynolds insurance as being the second most qualified. Seven of the eight voting members of the Evaluation Committee determined that Arthur 1. Gallagher has greater expertise and experience with Govermnental Entities. In accordance with the terms of the Request for Qualifications (RFQ), the City Manager has reviewed the Evaluation Committee's recommendation and concurs with its ranking of the firms. The City Manager recommends that the Mayor and City Commission authorize the Administration to enter into negotiations and, if successful, authorize the Mayor and City Clerk to execute a contract with the most qualified firm of Arthur J. Gallagher and Co., for an amount not to exceed $30,000 if the City continues the Group Medical Insurance with Humana or an estimated annual commission not to exceed $200,000 if the city obtains Group Medical Insurance from other sources, and further authorize the Administration to negotiate and award this contract to Morris and Reynolds Insurance, the second most qualified firm in the event that negotiations fails with the most qualified firm. 1;\1\<0 k;~ JMG:MG:c~ Attachments . ~ C:\Risk\SAll\ClifflHealth\brk-rk.wpd