City awards $12 million in health benefit contracts | Paterson Times

City awards $12 million in health benefit contracts


Five companies were awarded healthcare benefit contracts totaling $12 million over the next three years during Tuesday’s city council meeting.

Over three years the city will pay Horizon Blue Cross Blue Shield of New Jersey $2,549,633 to provide administrative services for the city’s self-funded medical plan; over three years the city will pay Aetna Life Insurance Company, a Hartford based firm, $5,786,288 for the city’s medical advantage plan for retirees.

Further, over three years the city will pay Delta Dental, Parsippany based firm, $2,547,378 for employee dental preferred provider organization (PPO) plan; Healthplex, a New York firm, is set to receive $667,822 over three years for providing employee dental insurance dental maintenance organization (DMO) plan.

$505,890 will be paid to Citizens Rx, an Illinois based firm, over three years for the management of prescription benefit service for city employees.

A large number of healthcare companies submitted proposals which were narrowed down by USI Insurance Services, a West Orange Based consulting company hired by the city.

City officials said the new contracts to manage the city’s self-funded insurance program will realize considerable savings: $2,184,000 over three years, according to consultants’ report submitted after an evaluation of proposals.

A week earlier, city officials held a non licet closed door meetings, excluding the media and the public, where consultants and officials from the contracting companies discussed the benefits and savings of the benefit contracts.

After the three year contract expires the city will have the options to renew at higher prices, according to city documents.