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Rowlett council renews employee health and benefit contracts after tough claims year
Summary
HR staff reported an 88% loss ratio and recommended renewing benefits with UnitedHealthcare, Mutual of Omaha and others; council approved recommended renewals with estimated budget impacts and rate guarantees, 6–0.
City HR staff presented proposed renewals for the city's employee medical and ancillary benefits at the Aug. 5 meeting and recommended contract renewals after market bids and negotiations.
HR Director Rick Diorgio said the city experienced a difficult claims year and reported a current loss ratio of about 88% (meaning 88 cents paid in claims per dollar of premium). Staff recommended renewing administrative services and stop‑loss coverage with UnitedHealthcare, life products with Mutual of Omaha (with voluntary offerings), Cigna dental and Alliance Work Partners for the employee assistance program. Diorgio said stop‑loss reinsurance options initially contemplated very large premium increases, but contract adjustments and re‑structuring reduced the projected premium impact to a more moderate level.
Staff presented estimated budget impacts and said the city currently has about 140 days of funded reserve for claims, above the city’s 90‑day target. Council asked about rate locking, unbundling components for future negotiation (TPA, stop‑loss, pharmacy) and the implications of the 88% loss ratio. Council approved the recommended renewals unanimously 6–0.
