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File #: 20-0061    Version: 1 Name: 2/3/20 - Resolution to Approve Amendment to Agreement with Keenan & Associates
Type: Resolution Status: Passed
File created: 2/3/2020 In control: City Council
On agenda: 2/3/2020 Final action: 2/3/2020
Enactment date: 2/3/2020 Enactment #: R-20-031
Title: Resolution to Approve Amendment to Member Services Agreement with Keenan & Associates ($88,000.00)

Title

Resolution to Approve Amendment to Member Services Agreement with Keenan & Associates ($88,000.00)

Memorandum

The attached Resolution authorizes Amendment and extension of the City’s Member Services Agreement with Keenan & Associates.  The Member Services Agreement granted the City membership in the Keenan Pharmacy Purchasing Coalition (“Coalition”) through the City’s current Pharmacy Benefit Manager, Express Scripts, Inc.  The Coalition represents employer groups by negotiating discounts for pharmacy products for city employees and retirees, and their respective dependents.  Employees and retirees, through their labor agreements or in accordance with the City’s employee benefit plans, have the option to use Express Scripts Network for their pharmacy service needs.

 

Budget/Fiscal Impact:  Coalition membership is on a calendar basis.  Cost projections for the Amendment were budgeted in the FY20 budget and will be budgeted in the FY21 budget through the end of the 2020 calendar year.  No additional funds are anticipated to be required to provide pharmacy coverage to City employees, retirees, and their respective dependents.

 

The Express Scripts Network, or its equivalent, is provided for under current labor agreements and our employee benefits program.  The plan is administered by Express Scripts.

 

As part of the City’s Coalition membership benefits, an annual market check is performed to ensure that Coalition members receive the highest level of savings for the pharmacy programs.  Pricing adjustments are made when identified. 

 

Fees and premiums have remained the same for the period of January 1, 2020 through December 31, 2020:

$1.75 per member/per month - Keenan Fee

$0.29 per member/per month - Sub-Broker Fee

 

The overall costs for the program will fluctuate monthly depending both on the number of employees and retirees enrolled in the program during any given month, and the amount of incurred claims actually paid during any given month.

Staff

Prepared by:                        Jessica Hull, Employee Benefits Supervisor

Reviewed by:                       John Fournier, Interim HR and Labor Relations Director

Approved by:                       Howard S. Lazarus, City Administrator

Body

Whereas, The City provides pharmacy product discount coverage to City employees, their eligible dependents, and retirees and their eligible dependents, in accordance with the employee benefits program and various labor contracts at an estimated annual cost of approximately $8,580,812.00, which is in line with current pharmacy trends;

 

Whereas, The City has been a member of the Keenan Pharmacy Purchasing Coalition (“Coalition”) for several years with the benefit that the City receives price adjustments in real-time to assure it is receiving the highest possible level of savings for its pharmacy program;

 

Whereas, Human Resources Services recommends approval of the attached Amendment to Member Services Agreement with Keenan & Associates (“Amendment”) to allow the City to continue in the Coalition;

 

Whereas, Funds have been appropriated in the FY20 budget to cover projected costs associated with the provision of pharmacy product discount coverage and will be budgeted in FY20 and FY21 to cover the remaining calendar year for the amendment term January 1, 2020 to December 31, 2020; and

 

Whereas, Keenan Pharmacy Purchasing Coalition complies with the requirements of the City Non-discrimination and Living Wage Ordinances;

 

RESOLVED,  That City Council approve the Amendment for the period January 1, 2020 to December 31, 2020, to provide pharmacy product discounts to City employees, their eligible dependents, retirees, and their eligible dependents;

 

RESOLVED, That the City Council approve the per member expenditure under the Amendment for each eligible City member during the Amendment’s term, payable from the Risk Fund; and

 

RESOLVED, That the Mayor and City Clerk be authorized to sign the Amendment after approval as to substance by the City Administrator and approval as to form by the City Attorney; and

 

RESOLVED, That the City Administrator be authorized and directed to execute the necessary contract documentation after approval as to form and content by the City Attorney, and that the City Administrator be authorized to take any further necessary actions to implement this resolution including execution of amendments that do not exceed the amounts authorized herein.