HomeMy WebLinkAboutCORRESPONDENCE - RFP - P902 BENEFITS_�_ SEGAL
THE SEGAL COMPANY
6300 S. Syracuse Way Suite 750 Englewood, CO 80111-7302
T 303.714.9900 F 303.714.9990 www.segalco.com
October 27, 2004
Vincent H. Pascale, Jr.
Benefits Administration
City of Fort Collins
Human Resources Department
215 North Mason Street
P.O. Box 580
Fort Collins, CO 80522-0580
RE: Western Cost Management Trust (WCMT) Proposed Renewal
Dear Vincent:
DIRECT DIAL NUMBER
303-714-9920
WRITER'S EMAIL ADDRESS
simming@segalco.com
We are pleased to advise that BCS Insurance Company is proposing a continuance of the current rates for
the organ and bone marrow transplant and drug rider coverages effective January 1, 2005.
Proposed Renewal
The renewal is based on BCS's analysis of WCMT's recent favorable experience.
The Chronimed Drug Rider, which is included in your coverage, will continue at the 2004 rate of $.52 per
eligible per month. The rider provides an additional 12 months of anti -rejection drug benefits following
expiration of the benefit period covered by WCMT's base coverage.
The current and proposed rates for the transplant and drug rider coverages for your plan are as follows:
Current Proposed % Change
$9.65 $9.65 0%
Covera¢e Options
There are two coverage options available under the WCMT, one for an 18-month benefit period (your
current coverage) and the other for a 12-month benefit period. Both options otherwise provide exactly the
same benefits. Rates for the three alternative plans for both the 18-month and 12-month benefit periods
are shown below:
18-month
12-month
Alternative Plans
Benefit Period
Benefit Period
Without Drug Rider
Alternative I
$9.13
$8.71
Alternative II
7.35
7.01
Alternative III
3.32
3.17
With Drue Rider
Alternative I
$9.65 -)
$9.23
Alternative II
7.87
7.53
Alternative III
3.84
3.69
Benefits, Compensation and HR Consulting ATLANTA BOSTON CHICAGO CLEVELAND DENVER HARTFORD HOUSTON LOS ANGELES MINNEAPOLIS
NEW ORLEANS NEW YORK PHILADELPHIA PHOENIX SAN FRANCISCO SEATTLE TORONTO WASHINGTON, DC
MMultinational Group of Actuaries and Consultants AMSTERDAM BARCELONA GENEVA HAMBURG JOHANNESBURG LONDON MELBOURNE
MEXICO CITY OSLO PARIS
Vincent H. Pascale, Jr.
City of Fort Collins
October 27, 2004
Page 2
Alternative I: Covers 100% of covered charges
Alternative II: Covers 80% of covered charges and the participant or underlying plan covers
20% of covered charges.
Alternative III: Benefits are subject to a $100,000 deductible and payable at 100% thereafter.
Drug Rider: Extended drug and support services coverage for 12 months after expiration of
the 18-month or 12-month benefit period.
SEGAL believes it is important to consider the financial strength of insurance companies and managed
care organizations that are candidates for initial selection or renewal as insurers or service providers to
employee benefit plans. Therefore, we regularly provide the most recent Standard & Poor's current
claims paying ability rating for the insurance company under consideration. We have selected Standard
& Poor's because of their excellent overall reputation as a rating service. In addition, they evaluate more
insurance companies than any of the other comparable rating services. You may wish to consult other
rating services (e.g., Fitch and Moody's) that also provide claims paying ability evaluations of insurance
companies and managed care organizations before making a decision regarding the initial selection or
renewal of an insurance company or managed care organization.
In this instance, however, Standard & Poor's, which only rates carriers that specifically request the
service, has not published a rating for BCS Insurance. A.M. Best, another rating service, rates BCS
Insurance Company as "A — (Excellent)". SEGAL does not itself perform insurance company or
managed care organization credit quality evaluations and does not offer any warranty as to the scope or
reliability (e.g., with respect to an organization's ability to meet future obligations) of the insurance
company or managed care organization evaluations performed by A.M. Best or any other rating service.
Please let us know if you have any question regarding the proposed renewal. We will discuss this with
you in the near future.
Sincerely,
Susan K. Imming
Izt
cc: Laurie Trujillo, RHU
138813/01945.001