Agenda 06/14/2022 Item #16E2 (Budget Amendment for Health Claim Expenditures)06/14/2022
Recommendation to approve a budget amendment to Fund 517, Group Health and Life Insurance,
to fund health claims expenditures for the remainder of FY 22.
OBJECTIVE: To transfer funds from Insurance Reserves to Group Health Insurance Claims in Fund
517, Group Health and Life Insurance for the purpose of paying health claims expenditures for the
remainder of FY 22.
CONSIDERATIONS: The Board of Commissioners sponsors a partially self-funded Group Health
Insurance Plan for the employees of the County Manager’s Agency and the participating Constitutional
Officer Agencies. The County utilizes the services of Willis Towers Watson as its consulting benefits
brokerage and actuarial firm. Claims under the program are adjudicated through the County’s third-party
claims administration company, Allegiance Benefit Plan Management, Inc. Reinsurance or “Stop Loss”
coverage is purchased through SunLife to protect the Plan against catastrophic claims. Utilization
Review, Concurrent Stay, Managed Care, and Provider Network services are provided through
Community Health Partners, Inc. The Risk Management Director is the Plan Administrator for the Plan.
Beginning in August of 2021, claims volume and claims cost increased significantly because of several
factors. These factors include the commencement of elective procedures previously delayed due to the
Covid pandemic; an increase in the frequency and severity of Covid claims and related hospitalization
cost; an increase in the cost of specialty pharmacy medications; and an inflationary increase in medical
costs in general. This overall inflationary trend has continued into FY 22 and hence, the budget for group
health claims requires amendment to assure that claims payments to providers is not interrupted.
The Group Health and Life Insurance Fund (Fund 517) maintains reserves to comply with Florida
Department of Insurance statutory funding requirements as well as unforeseen events as described above.
Therefore, an additional $4,100,000 is requested to cover the cost of group health claims through the end
of Fiscal Year 22. This recommendation has been reviewed by the County’s Benefits and Actuarial
Consultant, Willis Towers Watson with their concurrence. Funds may only be utilized for health claims
expenditures and cannot be used for another purpose. Unspent funds, if any, will be returned to Fund 517,
Reserves for Insurance.
FISCAL IMPACT: An amendment to the Operating Expense budget, Fund 517-121640-645920,
Insurance Claims in the amount of $4,100,000 is requested. A corresponding amendment to Reserves for
Insurance, Fund 517-919010-996300, in the amount of $4,100,000 is sought to transfer funds to the
Operating Expense Budget. The health claims budget is currently $41,218,700. The requested amendment
will increase the claims budget approximately 10% to $45,318,700. Fund Reserves will remain sufficient
to meet Statutory requirements.
GROWTH MANAGEMENT IMPACT: There is no growth management impact associated with this
item.
LEGAL CONSIDERATIONS: This item has been reviewed by the County Attorney, raises no legal
issues and requires majority vote for approval. -JAK
RECOMMENDATION: That the Board approves the attached budget amendment to Fund 517, Group
Health and Life Insurance, to pay health claims expenditures for the remainder of FY 22.
Prepared by: Jeff Walker, CPCU, ARM, Division Director, Risk Management
16.E.2
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06/14/2022
COLLIER COUNTY
Board of County Commissioners
Item Number: 16.E.2
Doc ID: 22296
Item Summary: Recommendation to approve a budget amendment to Fund 517, Group Health
and Life Insurance, to fund health claims expenditures for the remainder of FY 22.
Meeting Date: 06/14/2022
Prepared by:
Title: Division Director - Risk Management – Risk Management
Name: Jeff Walker
05/18/2022 10:52 AM
Submitted by:
Title: Division Director - Risk Management – Risk Management
Name: Jeff Walker
05/18/2022 10:52 AM
Approved By:
Review:
Risk Management Jeff Walker Director Review Completed 05/18/2022 10:57 AM
Office of Management and Budget Debra Windsor Level 3 OMB Gatekeeper Review Completed 05/18/2022 11:16 AM
Office of Management and Budget Laura Wells Additional Reviewer Completed 05/18/2022 11:37 AM
County Attorney's Office Jeffrey A. Klatzkow Level 3 County Attorney's Office Review Completed 05/18/2022 1:37 PM
Facilities Management Ed Finn Additional Reviewer Completed 05/27/2022 6:19 PM
County Manager's Office Dan Rodriguez Level 4 County Manager Review Completed 06/02/2022 9:53 AM
Board of County Commissioners Geoffrey Willig Meeting Pending 06/14/2022 9:00 AM
16.E.2
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