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SFHSS prepares competitive medical-plan RFP amid board concerns over transparency and retiree costs
Summary
The San Francisco Health Service System said it will post a competitive RFP for active employees and early retirees in September; commissioners pressed for more transparency and raised concerns about retiree costs and market concentration, while city counsel cited governance policies limiting draft review.
The San Francisco Health Service System (SFHSS) told its board on Aug. 13 that it is finalizing a competitive request for proposals for medical plans covering active employees and early retirees and expects to publish the RFP in September.
"We are in the final days of preparing this bid to get, to go public, in September," Executive Director Yant said during the Director—s Report, noting a blackout period and multiple procurement rules the department must follow.
Commissioners pressed for greater transparency about the drafting and review process. Commissioner Karen Breslin asked when the board would see the draft RFP and warned that early-retiree costs are becoming unaffordable, citing a figure of "$16,000 a year" for some early-retiree dependents. "We really need competition," Breslin said, adding that the board should ensure a level playing field among carriers.
Eric Rappaport, General Counsel in the City Attorney's Office, explained the board's historical role under its vendor policy and read from the governance policy the board adopted, saying that HSS has traditionally drafted and issued RFPs and the board approves final contract awards. "The board recognizes that it is neither effective nor efficient for the board to be involved in the selection of all service providers," Rappaport said, citing the policy's language and noting that commissioners have sometimes participated on evaluation panels.
Board members discussed options for greater commission oversight without contradicting policy. Several commissioners proposed that the governance committee review the process and consider having a commissioner sit on the evaluation panel or establish a mechanism to relay board objectives into the RFP.
The board did not take a formal vote on changing the RFP process at the meeting. Executive Director Yant and staff said they would integrate board concerns into the RFP and that a later phase could address Medicare and retiree-specific products.
What happens next: SFHSS expects to issue the RFP publicly in September; staff said they will provide the evaluation framework and noted the procurement blackout period details are in the Director—s Report packet.
Sources: Director Yant; General Counsel Eric Rappaport; public meeting materials.
