WIlkes-Barre official questions hidden fees in insurance contract [The Citizens' Voice, Wilkes-Barre, Pa.]

Oct. 12—WILKES-BARRE — A city councilwoman wants questions about compensation for a broker that negotiated a deal for city employee health insurance answered before voting on the contract Thursday.

While presenting council with agenda items for Mayor George Brown, who was absent from Tuesday's work session for a personal family obligation, city Administrator Charles McCormick asked council to approve an agreement with Highmark to provide health insurance in 2023 at a cost of $7,808,920.

McCormick said the amount is about 3.2% higher than this year's health insurance premium. He introduced Bill Joyce, of Joyce Insurance — Risk Strategies, whom the administration retained as brokers to review proposals from insurance companies that responded to the city's request for health insurance proposals.

Joyce said the administration asked his firm to put advertise a request for proposals in early June.

"We got two proposals that matched up that we found would work with the city contracts. One was from Bennecon and the other was from Highmark itself," Joyce said. "We went back and forth with Highmark to (cut) a couple hundred thousand dollars from their initial bid."

"What we'd like to do is take a couple of different things that Risk Strategies, who we represent now, does with data analysis, claims analysis, trends, wellness, coverage gaps and more or less keep an eye on where your claims are at," he said, adding that Risk Strategies would provide a quarterly report.

Joyce Insurance Group is now part of Risk Strategies, a national brokerage firm providing comprehensive insurance and risk management advisory services, according to the Joyce website.

"We think they do a great job with it. They represent probably 100 different municipalities throughout the country," Joyce said.

Council Chairwoman Beth Gilbert McBride asked why council was being asked to vote on a health insurance agreement this year and what if anything was different this year.

McCormick said the current contract ends at the end of the year and the administration wanted to give council adequate time to approve it.

"Last year, if I remember, some people expressed an interest and we interviewed them. This year, we had decided that it was probably better to have somebody with the insurance background and the information to do those types of negotiations directly," McCormick said.

McBride said she doesn't think council has ever voted on an agreement for city employee health insurance.

City attorney and deputy administrator Tim Henry said that if health insurance agreements had not been brought to council in the past, it was "probably just an oversight."

McBride asked if there was a breakdown of any fees included in the proposal. McCormick said there was not, at least none that Highmark presented to the administration.

McBride asked if the contract included the services offered by Risk Strategies.

McCormick said it does not, adding that the administration hasn't established how much work and what kinds of services Risk Strategies would provide, if any.

"They just offered all of those as potential services. Whether or not the city is going to take them is up to the administration," McCormick said.

After the meeting, McBride said the administration bringing the health insurance agreement to council for approval was "raising a red flag for me," and she wondered if Joyce's involvement warranted it "because there's some sort of commission."

"The administration doesn't have a breakdown of fees. But, obviously, Joyce Insurance isn't doing this for nothing. If it's called a fee or commission, I don't know how they're phrasing it, but that cost would be passed down, I'm assuming, to the employee and/or taxpayers," McBride said. "I would hope the administration is being forthcoming."

McBride plans to email a request for commission fees Wednesday morning.

Contact the writer:

[email protected] 570-821-2110, @MocarskyCV

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