You did well in your “no” vote as sufficient time and information was not provided in order to come to a well informed and intelligent decision.
The $65,000 should have been explained, and my guess is that was a comparison with the old carrier’s renewal rate to the the one recently accepted. It was likely a way to “sugarcoat” things when the comparison might have been made to another recent bid.
Some other topics that should have been considered:
1. Was a Nevada company asked for a bid? If not, why not? It seemed rather strange that yet two other “California” firms were chosen. Could that be a coincidence? Was is a “favorite” of our former California COO?
It was learned that the California firms chosen (the first for life, medical, short-term and long-term disability, and the second, for dental coverage are new to the Nevada market.
Good luck on that ! Any insurance professional with relevant experience will tell you that when a new market is entered, they initially “buy” business in order to capture a market share. Then, when the renewal takes place (in the new carrier’s case, 18 months)…WHAM…they will correct their rate structure to reflect the losses they incurred as a result of “buying” the initial plan.
Meanwhile, doctor fees are normally reduced, and they often leave the HMO and go on the the highest payer for their services.
With a new firm entering the market, physicians, like patients, are solicited and without any long-term experience in a market, they are not familiar to the ease of receiving compensation they were promised.
My suggestion to any employee under this new plan is to first contact the doctor and/or dentist regarding the experience with the respective HMO and CONSTANTLY check to see if their physician remains in the network.
2. Why was a professional consultant required? What was that firm paid to do a job that any professional insurance advisor could have likely provided us free of charge?
This is just another example of the refusal of establishing any form of a FREE “advisory group” consisting of qualified residents that would likely have gladly volunteered their time to examine any bids and supplement information to board members in their decision making.
None of the existing Board members have any such qualified experience in that aspect of the insurance field other than accepting a blind recommendation from a COO.
3. Something also not discussed were the benefits of the plan and their being comparable to plans offered by other employers.
Any insurance advisor will tell you that rarely do you see short-term disability benefits included in plans today and almost NEVER see long-term disability benefits.
4. Finally, the fact that SCA pays 85% of employee premiums for all benefits of the plan is far and above norms in the Las Vegas market.
The going rate is 50%.
Prior to the meeting one of the directors was approached regarding this contribution percentage and was told ACCORDING TO THE INTERNET, nationally, the employer paid 82%…and as a result of the INTERNET, felt this was a reasonable amount for an employer contribution.
When asked if any insurance professional in the community was consulted to determine if this was applicable to the Las Vegas market, no contact was made.
All that could have been done in lieu of that was contact any small business in the area to determine an appropriate contribution; but that too, obviously did not enter any individual’s thinking…
a.k.a. A Lack of COMMON SENSE and an OPEN MIND.
Other than Rana Goodman, they all felt qualified to accept a proposal that consisted of a COO recommendation that was made at the last minute and consisted of one question:
How much will it cost?
…a decision that will greatly affect association funds and employee well-being for the next 18 months.
Some things never change when it comes to competent spending of association funds, but at least in this one case, Rana Goodman was the only member of the Sun City Anthem Board to demonstrate it.
Of course, what do I know ? I only spent 35 years of my self- employed business life in the employee benefits field working with various insurance carriers and the 250+ independent insurance brokers who placed their business through my agency.