Youngkin seeks new bids on state employee health plans Youngkin seeks new bids on state employee health plans
Gov.
The initiative comes in the sixth year of contracts that extend up to 10 years, with a five-year term and five one-year extensions.
"We deemed that the current contract term is too long," said
"We believe it's in our employees' best interest to remain market competitive by going out for bid," Lawson said.
Youngkin spokesperson
"The insurance marketplace has changed drastically since the current 10-year contract was issued and by soliciting new proposals we can evaluate new and better options for employees," Martinez said. "Seeking new proposals does not necessarily mean the state will end the current contract."
But Democratic lawmakers aren't convinced. They raised a series of questions about the sudden push to rebid the contracts, as well as a sole-source contract issued by the administration of then-Gov.
"It just seems that there's a lot going on with this that hasn't received a lot of sunlight," said Senate Majority Leader
The state's primary health plans - COVA Care and COVA HealthAware - cover more than 200,000 state employees, non-Medicare retirees and their dependents. Health and retirement benefits have helped the state attract and keep employees who might be able to earn higher salaries in comparable private sector jobs.
"I think it's prudent that they are exploring this," Bishop said Wednesday. "Whatever we can do to improve the bottom line for health coverage for state retirees and employees, we're going to support."
He added, "It's certainly something I'm going to be watching closely."
The Youngkin administration first notified the budget committees in mid-July that it was considering rebidding the contracts and informed them on
Lawson said reopening the contract now would allow the state to take advantage of changes in the industry and adopt "new, innovation solutions," including reference-based pricing, an idea endorsed by the
"You know the saying, 'You buy cheap, you get cheap'?" Sen.
Sen.
"It would be, I think, in the commonwealth's best interest to ensure that our employees have choices," Favola said.
Lawson said the department included those pricing models as options in the bid proposal, but she added: "We just want to see all available options."
She also said the state would examine any potential disruption of employees' health care and choice of providers in deciding whether to change plan administrators. "We would look before making a decision," she said.
Part of the motivation for the bid solicitation is what Lawson called a "cutting edge" review of claims and policies under the
She said the review had been initiated by its
Surovell questioned the administration on why the state would issue a sole-source contract and included a contingency for the vendor to receive 20% of whatever money it recovers for the state.
Johnston, who acknowledged appearing on conference panels sponsored by the company, said its proprietary software already has provided "opportunities for savings" for the state.
"They have provided us a lot of excellent data to use," he said.
Johnston estimated that the review had identified up to
"Unless they save us money, they don't get paid," he said.
The administration also sees the request for proposals as an opportunity to set what Lawson called "definitive expectations" for the companies that administer the state health plans.
Johnston said, "We can hold companies accountable."
Surovell wanted to know why the department had not told the budget committees about the identification of potential over-charges, since they are responsible for reappropriating any savings as part of the budget process.
"Why haven't we been told?" he asked.
Fed unveils oversized rate cut as it gains āgreater confidenceā about inflation
Fed rate cut to bring 'real-time benefits' Virginia: Fed rate cut expected to bring 'real benefits' to borrowers
Advisor News
Annuity News
Health/Employee Benefits News
Life Insurance News