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Mounds View City Council October 24, 2005 Regular Meeting Page 10 • with BCBS as a separate entity. Staff checked with several metro communities including Anoka, Lake Elmo, Lakedale, Oakdale, Plymouth, and Stillwater, all larger or comparable with Mounds View. Anoka had the worst experience with the cooperative and didn't necessarily recommend it .but felt it was a beneficial program. He stated Anoka was not sure rates were as competitive as they could be each year. Another disadvantage is that it hooks the City into staying with them and if you want to bid on a year-to-year basis you would have to leave the cooperative. If the City stays and bids within the cooperative then the City can be booted out of the cooperative and be required to seek coverage elsewhere. He advised the commitment, once you enter cooperative, is to not leave and bid the process every year. City Administrator Ulrich noted that if you look at the long run and series of years, like the last six years, the co-op offers better long-term rates. He advised that due to the significant 2006 cost savings of $18,846 for the same coverage, and positive feedback from other cities, staff recommends the Council approve the draft resolution approving Service Cooperative (Appletree) as the City's 2006 health care insurance provider. He noted the City will need to monitor rates on an annual basis and be prepared to leave the co-op if rates appear to be non-competitive. He advised that one of the items that came up in staff research is that the State audited cooperatives, found some were not competitive because they represent a lot of rural communities, and BCBS provides better coverage to rural communities compared to Health Partners. City Administrator Ulrich stated a number of urban communities have utilized a cooperative and after research staff is confident it would be a good way for the City to go. • Finance Director Beer stated one of the reasons the co-o is ve com etitive is because the p rY p Y consist of 20-25% of Blue Cross-Blue Shield's business and have clout in getting better rates. Councilmember Thomas stated the report mentioned other cities had, in the past, problems getting timely information and answers. She asked what is the City's recourse should that occur and the City feel they are not getting proper service. City Administrator Ulrich stated one of the most important points is that the co-op is member driven so it would behoove the City to get involved with the annual meetings as things move along. As a member, the City has the right to file complaints, go to the Management Board, or direct policy at the annual meetings. He pointed out that with a co-op, there is both opportunity and responsibility to be sure it is properly managed. He noted the pattern of responsiveness was from several years ago and has now improved. Councilmember Flaherty pointed out that four of the five cities polled give high endorsements with Lake Elmo being only on since October St". He commented that typically co-ops practice a solid business plan, is a low cost provider, which may not mean the cheapest, but they do assure clientele for future years, which helps with budgeting purposes. He stated this is a sound business plan and they have consciously said this is what they want to follow. He .stated he has no problem going with this co-op plan and would support staff s recommendation. Finance Director Beer stated staff looked at where are we in regard to health care as far as usage.