Good morning. Welcome to the final Doge meeting. Council members, I just wanted to mention, I think I've said this before, but Council-elect President Howland has plans to go in a different direction in terms of this type of effort. So I indicated to him that we would wrap up the last item, which is this insurance issue today, and give him the maximum flexibility to move in any direction he wants to. So with that, let's begin with introductions to my far left. Stephen Libby, Council Research. Mary Stavopoulos, Office of General Counsel. Brian Parks, Council Auditor's Office. Philip Peterson, Council Auditor. Good morning. Rory Diamond, District 13, The Beaches. Ron Salem, Group 2 at Large. Good morning. Rory Aries, District 11. Mike Gay, District 2. Will Lane, District 3, Visiting. Matt Carlucci at Large, Group 4, Just Visiting. And are you going to be taking up the telehealth update? Yes, I am. Okay. Thank you. Yes, I am. And Council Member Miller is hoping to make it, might make it, might not, is what I've heard. Is there any public comment? None. Okay. Philip, I know you've got a couple of telehealth updates, please, sir. Yes, sir. Through the chair of the committee. So, our office was asked to look into kind of comparing the two programs, telescope, through the HealthLink JAX initiative, and then the right site or a right site-like provider. And so, through conversations with both JFRD, with telescope, and then with members of the mayor's office, we've ultimately come to the conclusion that in their current form, these are two separate programs. To do a true cost-benefit analysis, we would need to have programs that kind of lined up together and provided the same service. An easy way to see that is a dedicated phone line is set aside for HealthLink JAX. There's a specific phone number, 904-925-CARE. And you can call that, or a resident can call that and receive services from HealthLink JAX. Whereas, the right site model in its current form, someone contacts 911. You're obviously aware of this. But in order to get to right site, you have to go through 911. And so, that is a strain on 911 resources. It can be a strain on JFRD personnel, depending on how the call is deployed. So, in that manner, they're two different programs. You obviously are aware of the clientele that they serve. Even though right site will take uninsured patients, right now, their model is for insured patients, whereas telehealth is specifically for uninsured. And then, obviously, the cost. We know that telehealth currently is a $1.5 million cost to the city in the current year. Right site is a zero-cost contract. But if right site were to expand into a different area or expand their services to where we have a dedicated phone line, they're taking in more calls. I don't know that that would remain the same. Maybe it would. But until we got to that place, we wouldn't know. And then, lastly, the usage. I'm very aware that reading the report that this DOGE committee adopted, right site just hasn't taken off given a number of instances. Maybe it's lack of training. Maybe it's lack of involvement. Maybe it's lack of marketing. There's just not a dedicated push for a right site or a right site-like concept. So, in their current format, two totally different programs, while maybe having the overall same goal, they don't serve the same purpose. And so, it's difficult to do a cost-benefit analysis. We're also asked to look into things that... Can I stop you right there? Yes, sir. And let Council Member Diamond want to jump in. I know, thank you, through the chair, I know you're doing the Council Auditor's view of this, but just for folks listening, the issue here is that you have to dial 911 and you get to right site, whereas the city is paying for this phone line and for telehealth. But it would also be true that if, instead of getting the paid telehealth folks, you could be redirected if right site or another group agreed to it, to be routed to them, and we could get that for free. The folks at right site say that that's how it works in other places. It doesn't have to be 911. And there are other providers. Detroit has another provider where you don't have to dial 911 to get what is a free to the city of Detroit service. So, we could set up that kind of thing if all the parties agree, correct? Through the chair to Council Member Diamond. So, we have not had any specific conversations with right site directly, but what you're saying makes sense. In its current format, you're right. When an individual calls 911, they speak with the JFRD dispatcher, who then, based on the information that they take in, determine whether or not they can go to right site. And so, the JFRD dispatcher will transfer the call to right site. That call stays, quote, open, if you will, on JFRD site until the right site physician identifies whether or not that person needs to go to the ER or not. And if they don't need to go to the ER, they communicate back to JFRD and they close that call. But you're right. If there was a separate phone line, separate from 911, I think it would give a better picture of what the availability or the use of right site could be. Yes. And you had the second issue on the health care expenses. Well, I just want to address one other thing. We were also asked to look into things to consider with a right site-like service if the city were to truly, you know, go down that route full on. And I think the biggest thing is marketing that service. So, the residents of Jacksonville are not aware that right site is an option or a service that the city uses because they call 911 expecting an emergency transport or emergency assistance right on the spot, unlike HealthLink Jacks where there is that dedicated phone line. So, if there was, if the city was going to go to a right site-like service, I think there needs to be some marketing, some community awareness that would occur with that. The other aspect, and the report hit on it a little bit, but is the time spent by JFRD staff while transitioning someone to a right site physician. If it's on site, which they do on site, the JFRD personnel will assess the medical needs of the resident. And then if they are willing to talk to a physician, they will help connect them. Well, they stay there on site until that call is closed out. So, depending on if that's a five-minute call or a 30-minute call, there is JFRD personnel are on site, don't leave until that is all resolved. Because JFRD resources are somewhat limited, that could cause another firehouse, if you will, to have to go to a call in that area that normally would be covered by that unit, if you will. That's nothing out of the ordinary. That already happens on normal ER calls, but this just adds one more layer to it. So, just something to consider. And then lastly, if we were going to move to a right site-like program, we would want to expand the hours. You're obviously aware a right site operates Monday through Friday, 7 a.m. to 11 p.m., but calls are consistent on nights, early mornings, and weekends. So, just another thing to consider. And then, as the chair indicated, we were asked to look into the amounts quoted by Telescope for the savings that the city incurs through their contract. And first off, I want to address the terminology of savings. There's no savings to the city. The city does not realize any savings by entering into this $1.5 million contract with Telescope. There are avoided or possibly avoided charges, but those avoided charges are by the resident or the hospital. There is no savings to the city. There's no avoided charges to the city. This is a true expense for the city. As to the amounts cited by Telescope, they applied an estimated ER diversion rate of 55% to all of their COJ encounters to calculate a number of estimated diversions. That percent of emergency room visits that result in hospital admissions, which was a 12% figure, and then transfers to a different hospital or an extended hospital stay of 2% were numbers that they applied to those ER diversions. And those percentages come from the CDC, so nothing out of the ordinary there. But they then multiplied those percentages by the published data from the state of $4,844 for hospital charges, the national average for hospital stays of $10,000, and the national average of a high-variance hospital stay of $18,000. All of this resulted in a calculation of $11.1 million for the first year through September of 2025. Where their math fails, in our opinion, is that they applied those same percentages to the total number of COJ encounters rather than just the amount that would have been diverted from the ER. So when you apply that 12% for a hospital stay and the 2% for an extended hospital stay to their figures, it reduces their savings number by $2 million down to, I take that back, by $1.8 million down to $9.3 million. So there is a slight fallacy in their logic of how they calculated those savings. We've communicated that to the administration. We've communicated that to Telescope, but wanted to report back as the chair specifically requests us to look into that. Through the chair, Mr. Parks just informed me the administration agrees with our number and not Telescope's number. Okay, I'll just make it, I don't want to re-litigate this whole issue today by any means. We have a report, we've submitted it, just a couple comments I would make. I have been frustrated that the right side program in other cities such as Atlanta and San Antonio grew like crazy and the right side applied the same training, et cetera, to the local group as they did out in those other cities. And for whatever reason, it's still not clear to me that it just did not take off. But we are where we are. But I would like to move on, but let me go to Council Member Diamond and then Council Member Carlucci. I'll be really quick. Look, I think any telehealth money is going to come out of the budget. I think the finance committee will remove it this year. So I think the message really is to JFRD, take another look at one of these other programs that are free because you're not going to have this other one. It's going to be gone. Council Member Carlucci. Mr. Chair, I think it would be good to get a calculation on how much they divert from the emergency room like this after maybe three years and see what that number actually is and see it and have the administration, telehealth, whoever the parties would be, to talk with our hospitals, the main one, I guess, being UF Shands, to see if those diversions could equal some savings towards the city budget. And that's just what I think. If we're spending money to save money, then, you know, we want to save money. I think the encouraging thing here, though, when you're looking at quality of life and you're looking at people that just don't have health insurance and we're so lucky to have it. I mean, my God, I've gone through a pinched nerve deal for the last two months, and all I can say is thank the good Lord that I have health insurance because it's been brutal. But, you know, my doctors finally got their arms around it. And so if people can get decent and better health care, to me, if it costs us $1.5 million, I'm all for it. I can't imagine being without it and not being able to afford it. And we are here to take care of our citizens. But I say all that to say this, Mr. Chairman, because this exercise is wrapped up, we do know that about $9.3 million has been saved, apparently by perhaps the bank or the clients. But if after an average of three years or so, we know what that might be, then that might be the time to talk about how much we could save in insuring the uninsured in our contribution. And that's what I've got to say. Thank you. Thank you. Let me go to Council Member Arias, and then we will move on. All right. Thank you, Chair. Just a quick question regarding right size. So Mr. Peterson mentioned how they're only operational Monday to Friday from 9 to 5, whatever the case is. It was 7 to 11, I think. 7 to 11 p.m., right. And I'm going off of Council Member Diamond, what he stated earlier, based off of the budget, whatever happens next year. Who do we speak to? Is it JFRD, or do we speak to somebody at the right side to say, hey, this other service might be going away. We need services expanded in the morning hours, also on the weekends, because emergencies happen all times of the day. You can never expect them, right. So who do we have to take action on this, or is it something that JFRD does? And then the last part would be the marketing efforts as well, too. You talked about, like, education to the community. Whose prerogative is that? Like, is it us, JFRD? Is it right side? Like, all these things you mentioned, like, who needs to, you know, take the lead? Can I address that? Number one, the hours, it's the chicken or the egg situation. They wanted, they can provide 24-7 coverage, but the number of referrals that they were receiving, it was so small, they could not justify expanding their hours. If they were the only provider, and I think, and the city got behind right side as the entity to do this, I think they'd be happy to expand their hours. And they've indicated they would take indigent as well as insurance under that scenario. So, and the marketing is really internal to JFRD. You can train, it's been my experience in the private sector, you can train people all you want, but if you're not following up to make sure they're utilizing those skills, it just goes away. And I think that was a big part of it. All right. And then the last question would be, Councilman Diamond talked about Detroit. Wait, so would there be a scenario where we could also create a private number for right side versus having to go through 911? Or does it have to go, these other cities that you've encountered, is it all through 911, or do they have their own number? Yeah, so through the Charity Councilman area, here's the problem, is we're not the executive branch, right? We're not JFRD. So there's a bunch of stuff I would love to see the mayor and the fire chief take on to fix this, right? But I'm going to guess that they're not going to jump at it until the money is gone. And then they're going to be like, okay, we still want to do something. Let's go work with these pre-providers. And then they can look, there's a bunch of models across the country that are working. San Antonio, I think, is the best. I think it's because right side's there, and they've been working, and it's been worked out longer there. That's the one that I kind of, like, called the people and talked to my buddy who's on the city council there and, you know, learned about it more. So that's the model I think we should go for. But it's going to take public education. It's going to take probably a private number also. And there's no reason we built all this infrastructure. They can't just borrow that. But the mayor's got to do it with the JFRD chief. Yeah, it's on them. Okay. Thank you. We will now move on. Next item is a 2% lapse. Any movement there? Mr. Peterson. Through the chair to the committee, no movement currently. I did speak with the administration this week. They are waiting for the third quarter projections to come in. So the city council will receive the quarterly summary no later than July 30th. At that point, we'll have a pretty good idea on where each department will finish the year. They intend to address any shortfalls that might be projected with the mayor's transfer authority initially. And if they can handle all that administratively, they plan to do so. They would only come back to council if any of those transfers needed exceed that $500,000 authority. I think that's a wonderful idea is to leave the 2% lapse in place and transfer within the various departments would make a lot of sense to me. And I hope that's what they do. And I'm sure some type of lapse or might be a part of the budget process as we get into the next budget. 2% has worked pretty well, but it might have to be significantly higher as we move forward. And I know Council Member Lane is listening to all this. So, okay, we will move on to the Bailey Group. Who's going to present? Good morning. Good morning. You have a presentation for us, correct? I do. On the screen. Okay. Please introduce yourself for the public and everybody. Sabrina Hebert with the Bailey Group. And today we have... How's that? Better? I'm Sabrina Hebert with the Bailey Group. And also today from the Bailey Group, we have Sherry Beignet and Travis Cummings, who are both going to speak a little bit. And we have our two summer interns with us as well, Emily and Steph. So, I know Travis is going to wrap us up later, but before I really get going to the presentation, I just wanted to take a second to publicly thank the city's benefits team. We asked for a significant amount of data over this process. They provided everything we needed, and they did it. They were incredibly easy to work with, so I think that needs to be noted. These projects have become very meaningful to us, and I feel that we have fulfilled our promises to the committee, and we hope that you feel the same. And with that being said, our first topic, today we're going to talk about employee contributions, the stop loss, and then kind of wrap up our final recommendations for the whole process. So, the ask on the employee contributions was to provide alternative options in general and also focus on salary bans to benefit the lower-salaried employees. These examples that I'm going to go through are intended to be high-level alternatives to your current situation and to provide overall strategy. We can get in the weeds as much as you want, but there are a lot of numbers, and so that might require a longer, more focused meeting if you want to get into the details. But there are a lot of moving parts, so stop me if you need to. Let me stay on this one for a minute. So, these exhibits focus on the bulk of the active population. We excluded some of the employee classes that pay higher amounts, like COBRA, retirees, former elected officials, or a couple other ones that we omitted out of this. Mark Bailey talked at the last meeting about the importance of setting your funding rates appropriately, and this is one area that would be affected because these other classes of employees, their contributions are based on the funding rates. So, if you set the funding rates appropriately, you would generate some extra contributions for what these classes pay and their contributions. Another comment, plan design was outside of the scope of our particular project, but we do recommend looking at the plan designs and differentiating the plans more so that they can have further apart actuarial mathematical values. As Sherry Beignet mentioned in the last meeting about trying to encourage people to be in the high-deductible health plan, and so it would be beneficial to look at your plan designs and get them actuarially more apart so that you can strategically use your contributions to drive people to more efficient plans. And then just to note on the salary band options, sometimes HR teams don't love them. They're administratively difficult to administer because you have a lot of more payroll codes, and you have a lot of changes when people change salaries up or down or whatever. So, you know, you may think about benefiting, you know, like taking one of your plans and just paying more for that plan to help out some of the dependent tiers, but I am showing you both. Any questions on that? That was kind of a lot to reset. Okay, this first slide is the baseline, which is where it uses our NFP-recommended funding rates for 2027, and it uses current employee contributions. So this is your baseline. The top numbers are the overall funding rates proposed, and then the two sections below break out the employer and the employee. And like I said, we just backed into what you're projected to pay as an employer since we kept the employee rates the same as they are right now. And this works out to about 10% employee contribution to the overall. We see closer, as we talked about before, to 25% to 30% in our other public sector groups of employee contributions. So there's room there. You would never get there in a year, you know that, but there's room for improvement there. So just to stop you there, we're presently, the employee contribution is 10% of the actual expense. Other public entities similar to ours across the state are up in the 20, 25%. Yes, but this is projected for 2027, but roughly what you're saying is correct. Okay, I just want to make sure the committee understands that. Council Member Diamond. Thank you, Mr. Chair. It's funny. So this is the, of all the stuff the Bailey Group has been doing, you guys have done really great work. This has been like the one thing that's in the back of my head that assuming the referendum passes on property taxes and we have to find other revenue, the subsidy that the taxpayers or the people of Jacksonville are doing for COJ employees is higher and better than other places. I mean, I put it in Grok, and Grok kicked back the same answer to me, that Tampa and other big cities are, employees are paying more. And so I think that is going to be the number one thing I'm going to be talking about over when we talk about this particular issue, and that needs to go up. And I don't want to do it to our employees because I love our team, but we're going to have to balance this budget. Not me. Will and Raul and Mike, when we're gone, we're going to have to find money somewhere, and that's going to be one place. Thank you. And I appreciate you mentioning it today, but I figured that was my moment to say it. And not to get ahead because Travis is going to wrap up, but, you know, it's a combination of things. It's looking at your pharmacy and looking at your funding rates and looking at all the things. So it doesn't have to just all get pushed onto the employee. We hope that we've shown you all recommendations that don't just, you know, hurt employees. Okay, so this is the first scenario option that's not salary banded. So it's set up the same way as the first one with the funding rates at the top, then employer, then employee in the sections. In each of the scenarios we did, we focused on the outcome being budget neutral, which is kind of why we do these employee contributions at the end because your funding rates have to be set and all the other things have to fall in place. So we focused all of the alternatives on the dependent tiers because your employee-only rates are low already. So there's not much to be done with those. Yeah, your employee-only rates are at or below the benchmark data for all the plans when we did the benchmarking. So the first optional set of plans, let me get my paper in order. So this includes the proposed 2027 funding rates at the top. And then this strategy would pay the same employer contribution for all the plans and all the tiers. Thought being that you would use your two plans that there's no employee cost as your baseline, and then you would pay the same employer funding across all the plans. What I like about this is that budgetarily, you know when someone's hired, this is the budget number. It doesn't matter which plan they pick or whatever, you know what the budget number is. But also, the actuaries have already done the math for you. You know what the plans are worth. And so contributing the same, it seems like a logical solution to me. And if you did that, it actually gains back about 7% in the budget. So it's one of the thoughts. Any questions about that? And then the next one is the same funding rates at the top. And then we just looked at increasing employee contributions 10% on the dependent tiers. It doesn't, at the bottom line, it really doesn't help that much to do that, except that it probably moves you in the right direction. But financially speaking, it's not significant. Okay, so now as we move into the salary bands. In these illustrations, the dark blue represents salaries from $0,000 to $50,000. The pink is $50,000 to $100,000. And the light blue is salaries over $100,000. This is what I chose from looking at your census and drawing a line, you know, just where I thought was logical. The ranges can be set at any level. And that's what I was saying earlier. There's like hundreds of ways you could think about this. And so I just picked what I thought was most logical. The first slide here, just like last time, is your baseline. This is where you are. This is current employee contributions, you know, in all the tiers. So that's why they're the same. So in this example, this example shows raising the employer contributions 5% for the lowest salary tier, leaving the middle salary range the same, and then decreasing the employer contributions 6% for the higher 100 plus. It's a pretty big jump if you actually look from current to where that would put people. So I'm not sure if, you know, the city would be willing to do that. But it would be, that's what it would take for it to be budget neutral in this scenario. Then in this final example, this would put an additional 7% employer increase for the lowest salary tier on the dependent tiers, and then just add $40 flat contribution for all the others. So $40 a month is what it would take to make that budget neutral. So you can kind of see it's just kind of thought-provoking about the ways you could do it. Sabrina, what are you defining as budget neutral? So really what we're doing is we're looking at the employee contributions on that low tier and setting them where it seems logical and then backing in to what we would have to do to make up that money. That's what I would consider. But what do you, maybe I'm not making myself clear, what are you trying to make up? Are you trying to get it to 25%? Is that what you're trying to do? No. In these scenarios, it just, it stays the same. You're not gaining anything in these particular scenarios. You're just making up for what you added, what you gave additional to the lowest tier. Okay. You're simply lowering it here and raising it here. Correct. Correct. Sure. Council Member Arias. All right. This is all great information, but I don't, and obviously you could skin the cat however you want. There's different scenarios, but have you made any scenarios where we're just literally reducing the ER cost just to see what that would look like? Because, you know, I think on slide number two, you had like a 6% cost for the higher tiers. Like, are there scenarios where we're just reducing costs and not really adding any more? I mean, we could. I don't know if he would get it through, but yes, absolutely. And where would you say is the highest bracket for the ER cost? Is it the dark blue, the pink, or the light blue? Well, right now it's, right now it's the same, right? Because we don't have things divided up by salary. So in your today world, the employer contribution is the same. Okay. Is that what you asked? I wanted to know, like, which bracket is the one that's really spending the most on ER cost? Oh, that would definitely be a deeper dive. Because that's where I would definitely reduce it by, because in one scenario you had the light blue being reduced and the other ones weren't reduced. Because you're looking at 5.7 on ER cost. That would be a deeper dive for sure. That was part of what we looked at. Okay, cool. Thank you. Quick question. Last year, and I'm sure Council Member Laning can help me, we had a $21 million deficit between what we were spending on health care and what we were collecting in premiums. Is that correct, Council Member? You're nodding your head. Chair, I think I had $20 million-ish in my head, so I think $21 million is pretty accurate. That's actually one of my questions I was going to ask at the end. The 10% that our employees pay as a cost share versus the 20% to 25% benchmark, it would be interesting to see, and maybe that's something Mr. Libby or Mr. Pearson can look at. Would that make it to where we didn't have to subsidize by $20-ish million? Because Council Member Diamond brought that up. It wasn't just our medical plan with good rates. It was then $20 million of property taxes, essentially, that we're plugging that $20 million subsidy. So maybe that's a further research we could do. Other cities, I think the 20% to 25% was the number mentioned for other municipalities in Florida. But would that make us to where we no longer had to subsidize it from the increasing year-over-year increase we've been doing out of the general fund? Well, you're getting to my question. What would we have to do if we just did it, boom? I don't know that we'd do it in one year, but if you could, what could we do to get that 21? You know, like the rest of us, we're looking at this property tax thing. And in addition to that, we had to replenish the trust fund for health care with another $5 million because that fund was down to almost zero. So have you calculated or can the auditors calculate what we would have to do in one swoop to eliminate that $21 million? So overall, all of these contribution strategies are based on those funding rates that Mark presented, which are 75% above that. So, number one, if you get your funding rates set correctly, then you won't have to put in your million-dollar help throughout the year. It solves that. Yeah, I think, Chairman and members of the committee, that's an important point that kind of level set from the last meeting is that these funding rates are a result of the 75% roughly funding recommendation from actuaries to make sure your premiums are actually sound, which is really how this endeavor took place, and we were retained to work with you and Councilman Salem and the committee to find out how we can overcome that versus backfilling it every year with $20, $25 million or whatever to make it more sustainable. In doing that, though, these rates now are significantly inflated, but they're real, right? They're accurate, and it would require, now it requires additional funds on a recurring basis, right, that at least hopefully the city can plan for and forecast and make decisions on from the employer side and the employee side. But you've got to figure out what that looks like. In the past, obviously, most of that has been borne by the city and employer and, therefore, the taxpayers. So I just wanted to make sure we were all clear on that. And the other thing I would just mention, we showed, I should say, the Bailey Group showed roughly a $5 to $7 million savings just in changing the prescription provider for our benefits, which is a very simple change. And you could even cover some of the drugs that might not be covered by the original plan, by the new plan, and it would almost be seamless. And anything you do in that regard is not included in these funding rates. So it would help, you know, bridge that large gap. I mean, here we are, June 16th. The budget's going to be presented by the mayor to us in a month, roughly. And I've got to believe that most of these decisions have had been made on on benefits. Sure. So I'm just not I'm very curious to see the budget to see if they have listened to some of these recommendations. And are they taking advantage of some of these things, particularly as we look at the property tax? Council Member Diamond. Thank you, Mr. Chair. So my thought on this is the same as it is with the telehealth stuff, which is we can't tell them to go fix the plan. We can't. They either fix the plan or they don't. And by that, I mean take these recommendations, find the savings, and in addition, shift some of the burden on this back to the employees who have a very generous plan right now, right? We can't do that. All we can do is say we're not plugging it this year. That's what we can do. So the $20 million won't be there. So for a finance committee, I mean I want a message to the administration that I plan on finance if I'm on it. Or if I'm not, I'm going to sit over there and be annoying and just be like, hey, don't plug the hole, fix the plan. And I think people will be very upset if the administration hasn't thought through that. I don't think they have, is my best guess. But I hope they can. Mr. Parks. There's a couple different things, and so I'm going to actually talk on that point first. I'm going to go back to if the employees were to cover all of the increase. I have those numbers as well. So as they're going through the NBRC. Yeah. It's a high number, so I'll get to that. But what they've proposed at NBRC is what they were doing is basically increasing the employer contribution across the board for this proposed year and having, and so setting up a new rate. Like this is the new kind of, you know, price of the premium. And then going forward, increasing the employee and employer on a normal basis, which has not happened for the past 10 plus years. So that is kind of what the proposal they have there. That's, they've also looked at different things to keep the costs down. I have not, group health has not come up yet, so I don't know what the numbers are. But I know that they've supposedly made certain adjustments to whether or not it's pharmacy and health to kind of keep the costs down there. I cannot answer that question real quick. As it relates to Councilman Lane's thing, if you just increase the employee only, keep in mind we budget about $9.3 million of employee costs. If you added $21 million onto that, that's more than, you're like tripling. So that is a very big increase. The employer portion on just the premiums is $34 million right now because, again, that number's been artificially low as well because of the separate contribution. But if you did that, you would be talking about tripling rates. So that is a very big number on that. So that's something you just may need to consider. I mean, and that's tough on some of those employment. Can I, and I'm going to go to Council Member Diamond. I don't think anyone is suggesting this is a one-year fix. We would never recommend that to anyone. But I think there's some, we are presented some relatively painless ways, such as the prescription plan that could be implemented and would not require a whole lot of change for any employees. Yeah. And then you, but I think you have to look at premiums, but it's got to be done on a gradual basis. And I think as it relates to that, that's kind of what the goal is there. But as it relates to premiums, I'm not sure that they're necessarily planning on changing firms. Again, I have not, that has not been presented yet. So I can understand they've alluded that they've, again, looked at some different things, made certain adjustments and stuff like that as they're trying to go forward. So, but I don't know all that information is obviously they're still working through the process of finalizing their budget. But I did want to kind of put that on your radar just so you had it, you know, and then also the severity, just because I don't know that we always know how much money we're talking about. You know, like when the 21 versus the 9. I'll make one other comment and then I'll go to Council Member Diamond. I think we're beyond tweaks in the plan with what we're facing from the property tax thing. I think tweaks have been handled in this plan for the last 10 years, which was, I think, the last time anything significant was done to rates and such. I think we need to get beyond that. Council Member Diamond. Yeah, and I want to be clear because we're on the record and I don't want to freak people out. I agree with you. I don't, you don't triple the employee costs overnight. You just don't do that. But that being said, there's rarely silver bullets to any financial problem in business. That just, that rarely happens. But there's small tweaks, there's big changes, there's moderate changes. It's going to have to be like 20 different things done all over the course of a couple of years to get this thing into a better shape. So I just, and, and simply moving the plug from employer contribution from plug doesn't really save us any money. It's just putting it into a different line item and maybe projecting out a little bit more intelligently. But that doesn't, I don't really get us anywhere either. So I, look, I do think this thing is going to pass. I'm going to say it a thousand times. It's going to pass. And then tougher and tougher decisions are going to have to be made. The sooner they get made, the better off we are. Who's next? Sherry. Hello. Sherry Beignet with the Bailey Group. I am here to talk a little bit about your stop loss coverage and what is happening there. We did take it out to market to get a general idea of what is out there. I will caveat that by saying it is extremely early to be getting stop loss quotes. So everything that I am going to talk about today is very, very preliminary and will likely not be what you find in another three or four months when they actually start working on stop loss. Sherry, can you explain what stop loss is for those that. Yeah, for sure. Definitely. Thank you for reminding me. It was on my radar to do and then I forgot. So stop loss coverage covers catastrophic claimants. So with your current contract, you have a million dollar stop loss contract, which means that if there is an individual who has claims over a million dollars, any amount over that million dollars is reimbursed by an insurance contract. So it's not that claim over a million dollars is not paid for by the city. This helps protect from these very catastrophic expenses. I know a million dollars seems really high. I have had in my groups, I handle three or four groups basically total. And in my groups, I have seen million dollar claims almost every single year by one of the three or four groups that I'm handling. So it's happening out there. They're not unusual to see these really large claims happening right now. And so you pay a premium to the insurance company to administer or to provide this extra insurance coverage over and above. There are some rules and stipulations, and I'll get into that a little bit as we look at the actual quotes in a minute, as far as what periods of time are covered by stop loss coverages and things of that sort. But to get into, before we get there, one thing that we also did is we did what's called a specific deductible analysis. And what this does is it looks to see whether that million dollars is the right fit for you. And I will just caveat it at the beginning and say it is about where you need to be based on the calculations. So if you take a look at this, the first line that's black there shows your current contract. So you have a million dollar specific deductible level. Your current premium for that coverage is $16.60 per employee per month. So you're paying $813,000 for this particular coverage. And then what you'd see down below there is what our estimates are based on actuarial data on where we think the premium would go or should be roughly based on a big scope of businesses, not just one or two companies, but a big, very large group of businesses that we handle stop loss coverage for. So if we were to lower it to $800,000, we would expect actually the premium to be $19.70. You're actually starting a little higher than where we would expect you to be right now. So you can see that that would increase your premiums there by $378,000. That's not right. That's the savings. Sorry. An annual premium would then be almost a million dollars, $965,000. And then at $900,000 in premium we'd see, or in spec level, we'd see a premium of about $741,000. Now under that you see a million dollars. And this is what our book of business is showing a million dollars in premium should be. Instead of the $1660,000 that you're currently paying, we're showing our book of businesses at about $11.97. So your premium compared to our book of business is larger, is higher. Sherry, can I ask you quickly? Sure. Is that stop loss portion of this bid out separately? Yes. The city has a separate bid out for the stop loss portion of our insurance. They should. However, currently your coverage is carved in with Blue Cross and Blue Shield, which means it's a part of your Blue Cross and Blue Shield contract. It is typically, however, a separate contract, and we would recommend that you bid that out. I actually have some preliminary, very preliminary quotes again. So underneath that you'll also see what it would be if we were to increase the level to $1.1 million and then $1.2 million. You'll notice down towards the bottom it shows the savings conversion to frequency. Those numbers represent how many people would need to go over that million dollars for it to make sense to switch the spec level. So if you look at the $1.1 million, for example, we're showing a savings of about $53,000 per year, and it would take 1.14 people. Obviously, we don't have 1.14 people that hit it. But basically, if you have two people that have claims over $1 million within the group, then you could see some – you're no longer seeing savings by making that change. So ultimately, as I mentioned at the beginning of this page, we are seeing that the $1 million is probably the right fit for you. Now, this, again, is very preliminary. We don't have final quotes. We don't have final numbers with your renewal. So this is just an estimation based on the actuarial numbers. Who drives the process, whether this is included in the Florida Blue or it's done separately on a separate bid? Is that the third-party administrator, like for us being Gallagher? Does Gallagher drive that process? Normally, as a broker, your broker would be sending out RFPs in conjunction, usually, with your purchasing department. Okay. Yes. Please, Mr. Peterson. Through the chair, a question for you, Sherry. Yes. If the city – if Florida Blue was not covering the stop loss, would the city be responsible for covering those claims above the million dollars and then have to seek reimbursement or fight, for lack of a better word, with that? Yeah, I'll talk about some processes that will help protect you in that process as well. Yeah. So as I mentioned, we did go out to bid to get some very preliminary quotes. I actually requested quotes from 15 carriers. At this point in time, we actually only received three bids. I would say estimations really is what this is back at this point in time. The others felt like it was too early to be able to provide any kind of data and weren't willing to provide that. It was kind of done as a favor. All of these are at a million dollars of spec level. And, again, in green, you'll see your current contract there. And then the first two in blue are from Partner RE or Partneree. They are an A-plus rated company. And one thing that I think is really important to understand is where we go down, you'll see the specific contract. Your current contract is what is called a paid contract, which means that it doesn't matter when the claim happened or what the incurred date of the claim was, as long as it was paid during the contract year. It's going to be covered under the current contract. The coverages or the quotes that we are getting back are what we call 24-12 contracts, which means that the claims can be incurred the prior calendar year, in your case, because you're a calendar year contract, plus the current plan contract year. But it has to be paid in the contract year. So you have a 24-month period of time for incurring the claims, but they have to be paid during the 12 months of the contract year. A good example would be, let's say you have somebody who's in the hospital. They get their hospitalization happened in 20. We're going to use the current contract just to kind of give you the example. Let's say their hospitalization happened in 2025. However, it was towards the end of 2025, and the hospital bill didn't actually get paid by the insurance company, by the city, until in the calendar year 2026. It would be covered under a 24-12 contract. But if that hospitalization had happened in 2024, it would not be covered under the current, under the 24-12 contract, because it's outside of that 24-month incurred dates, period. So 24-12 plans are going to cost you more than a 12-month plan, because they give you much more flexibility. Absolutely, and we would absolutely never recommend that you put in place a 12-12 contract, because you absolutely are going to have claims that are going to be incurred in a period of time prior to your plan year that are being paid out. That's what we call run-out. It happens very frequently, always. Usually about three and a half, four months' worth of run-out is there. But a big hospital claim can be even longer. Do you know how many million-dollar claims that the city of Jacksonville typically has in a year? One-ish. One-ish. One-ish. Okay. Yep, on average, one-ish. So you can see there, the first line, you'll see the rate at $18.24. I want to make sure that you understand, we do not have your renewal from Blue Cross for your stop loss. I would absolutely expect there to be a bigger than 10% increase in stop loss premiums. I don't know what that would be at this point in time, but it's very likely that we could see that increase there. Stop loss, I'm actually budgeting for my groups right now. I'm budgeting a 20% increase. The stop loss market is tough right now, and so I am budgeting a pretty high 20% increase for my stop loss groups. So 9%, almost 10% is what the partner, which is the cheapest, is coming in at. It is not a final number, as I mentioned. It would require pending large claims. Usually we need claims up through about September to be able to finalize these numbers. But this does include what's called a no new laser. Right now you don't have any lasers, which means that everybody on your group is covered on the plan. If anybody hits over a million dollars, it's good. But you could end up with somebody who has a very, very horrible disease that the carriers decide that they want to either increase the deductible. So instead of being a million dollars, maybe they're not going to cover that person until they hit two million or three million. Or you could have them exclude that person completely, and that's what's called lasering. Our contracts, we always try to include a no new laser into the contract. This contract also would include a 50% rate cap. So if you had a really horrible year and three or four people hit your million dollars, then the next year the most that the insurance carrier could increase the rates is by 50%. You don't see that. I have actually seen that be used, the rate cap, on several of my groups over the last few years because the coverage is really, like I said, stop-loss is rough right now. The next blue line is the same quote. You'll notice that the employee-specific rate is the same at $18.24. But it includes what's called a gene therapy coverage. And I'm going to talk about that in just a few minutes. This is a super important coverage that we are including in most of all of our contracts. At the current level, it's at $4.75 per employee per month. That does increase your overall cost for this coverage pretty substantially. However, as you'll see in just a few minutes, it's a very important type of product to include for stop-loss coverage because these could be super expensive. Then we have a Sun Life set of quotes. They're coming in at 22.41% with a 50% rate increase if we were to add the gene therapy. And Voya is the last one, and they are actually even higher. So if we take a look at the next page, we have what I mentioned I wanted to talk a little bit about is the gene therapy solution. So gene therapy solution, as I mentioned, the cost for this is $4.75. And this basically is going to provide some additional coverage for super, super, super expensive FDA-approved gene and cell therapy medications. You'll see a couple of examples listed down here under the high-value treatment support. And I do not pronounce prescription names very well or disease names in these particular cases. There's some on there. But I will mention hemophilia, which I think is a very important one. This medication actually cures hemophilia, which is amazing. But it comes at a very large price tag of $3.5 million. It's a one-time dosage. So it wouldn't be an ongoing thing because it cures the disease, but it does have a very high price tag to it. And so we like to have this coverage added on to our stop-loss coverages because obviously you have a $3.5 million claimant on your stop-loss coverage. That's going to end up costing you a whole lot on your stop-loss coverage in the future because it would increase the premium. So what this basically does is it takes that out of the equation, and you end up not having to pay that. It's actually almost an additional insurance on top of insurance. So there's some examples. The current GTS or gene therapy solution product covers 14 medications, and that would be, as I mentioned, the second of the two. So I want to give you a quick case study. I'm actually going to turn it over to Sabrina, who has a little bit more experience with actually a gene therapy case. This is not my group, but she has more understanding of it. So I'll turn it over to her. Yeah, so we've actually had two gene therapy cases in all of our groups. They say they're one in a million, but I guess, you know, we've had two. But in this particular scenario for one of our groups, an infant claimant required, like one of the ones that she mentioned, which I can't pronounce either, a one-time curative gene therapy that needs to be admitted, and it has to be done quickly. Like it's an infant that's just born. It has to be administered right away. Everything got approved. And in this situation, the infant was cured and lived a normal life. And the plan cost avoided, the claim was $2.3 million. And so they saved $1.8 million attributable to the stop loss and then $500,000 in direct plan impact. So it's that kind of stuff. It's like a cost, but it's a risk that you're covering that could be like an explosive risk. And we've had two groups that have highly benefited from it. All right. And then the last piece that I wanted to mention, it does address what Mr. Peterson kind of brought up. One of the advantages that you have when your stop loss coverage is carved in, like it is currently with Blue Cross, is that the city is actually not ever charged for claims over $1 million. When they receive their usually monthly bill, that amount is actually just subtracted out. So they never have to pay those claims out. When you have a separate stop loss carrier, like if we were to move to Partner Re, then you are going to have to pay that amount over and above $1 million, submit a claim, and be reimbursed. However, we do have programs that are available to help quicken that process so that you don't have to wait for that. It actually pays within 72 hours through the Amwin Advanced program. So when we see a claim that's going to be over that million-dollar mark, especially if it's a pretty substantial number, we can provide them with a quick amount of data, and they can turn around and reimburse the group within 72 hours. So you're not having to worry about that cash flow situation in this particular case. Any questions about stop loss? All right. Well, then, I'm going to turn it over to Travis to rasp us all up. Do you need me to click, or you got the clicker? Thank you. And I know the committee through the chair has probably been a very riveting discussion over these last six months and probably subject matter experts by now. So thanks for indulging us. And I know I want to thank Madison, Cofield, Mark Bailey, who aren't with us today. We've all been kind of tag-teaming this exercise with a lot of others for their help. And I know Sabrina mentioned earlier that Mary DiPerna, Kelly O'Leary, obviously Councilman Salem as chair, and the committee being great with just various information sharing with us so we can carry out this endeavor. We're going to start with this, and this will be a pretty quick wrap-up, and obviously we're available for any questions. And, you know, look, we knew this was about a six- to seven-month project that would kind of coincide with your respective, you know, budget prep and planning and fiscal year and so forth, particularly if any changes are considered in time for your, what's a January 1 plan year for the city of Jacksonville. So this timeline obviously outlines that. I will tell you that it obviously, from what we're concerned, while this may be our last presentation and effort with the committee or with the city, we're available for weeks or months to come if there's any other questions that you may have and so forth. As you look at the timeline here, clearly we started as chair, say, yeah, go ahead. Travis, I'm sorry. I think that's an important point. The health insurance plan is on a January 1 to December 31 cycle versus our budget, which is October 1. So there are opportunities, I would think, to make changes during the budget process, which would still be months before this actually kicks in in January 1. I assume that's an advantage to making changes, that three-month difference there. Yes, sir. Well stated. And, I mean, obviously, clearly with a group of your size, whether it be procurement for stop loss, for PBM, for pharmacy, for TPA, we'll talk about all that here momentarily. You know, there's timelines in place. I'm sure there's certain agreements or contracts. You know, my guess is some of this has been taking place as administration witnesses it and just our subsequent meeting with Kelly O'Leary and others. There's some of these things that have been worked on, and I'll get into a little bit of this as we go through. But, no, you're exactly correct, Chairman. In January, when we started the pharmacy effort, clearly, as you mentioned earlier, there was a significant amount of savings. And in fairness to, obviously, your benefits team, your existing broker, as well as, you know, the mayor's office, particularly with Ms. O'Leary that oversees this particular, let's call it, department, the rebates lag, as we mentioned before, Chairman of the Committee. So, y'all are paid from an annual basis on that, and those should any day now, in June or July, be paid to the city. And those are a result of the prior period of time which the contract was strengthened from a rebate standpoint, from what we understand, the information. Those rebates just were not known until well into this exercise. That may tighten, that may close some of the gap on some of the prospective savings, but we still think that a significant amount is involved, and we'll get into that in a second. These next two slides are pretty redundant, but in essentially the first couple months, we focused on a pharmacy review very extensively. Moving into March, we looked into repricing as it relates to your TPA or third-party administrator, call it an insurance carrier. In this case, that's Florida Blue or Blue Cross Blue Shield. And then in April and May, we started looking into, clearly, your benefits-eligible population, which was part of our scope of work as it relates to who is covered, including any in other agencies within city government. Obviously, you have three of those. We'll talk about that in a second. And then in May and then in now June, whether it be stop-loss, contribution strategies, really what's been the merit of this exercise, and I think Mr. Parks was spot on and kind of what he mentioned as it relates to budgetarily, you know, getting your funding or your premiums to where they were clearly accurate. And, you know, I really spoke to what the cost of your plan was versus, you know, just using ARPA dollars, you know, as you all remember a few years ago, to close some of those gaps and shortfalls, and those days are gone, as we know. Okay. In this next slide, you will see that really the same thing. We won't spend a whole lot of time on this and get in the meats of kind of our recommendations to summarize them, you know, just to hit one more time as it relates to, you know, the few agencies that were covered, whether it be the Regional Planning Council and so forth. You know, we conducted some work there and made some recommendations, obviously, with the caveat being to ensure that, you know, you're compliant there as you look, would work with your General Counsel's office accordingly. To get to the kind of meat of the really results of the six months, you'll see some of the key findings here on this slide, and that relates to clearly your pharmacy spin, not necessarily uncommon with groups of your size or smaller groups, that diabetes was a top-tier pharmacy class as it relates to cost, followed by inflammatory conditions. And then as we looked at the PBM marketplace, Express Scripts, which is really the dominant player, which obviously CVS and Optum are as well, showed significant results from our analysis. And we still, you know, stand by the fact that carving out your pharmacy, you know, just as we talked momentarily ago about your stop loss, particularly from an aggressive market analysis to create, you know, some competitiveness for a group of the size of the city of Jacksonville is definitely the way to go. And we continue to stand by that. I want to say we've got all but two of our groups, and there's some extenuated circumstances that are carved out from the pharmacy. Chairman? And my recollection is when police and fire pulled out, they switched to Express Scripts as well. And I think have had the same kind of savings. Is that correct? Yes, sir. And those have been demonstrated year over year. And unfortunately, when your pharmacy spend, you know, increases, which we're seeing that with, once again, gene therapy drugs, some of your biosimilars, your specialty drugs, your GLPs are a whole other issue, even if they're not allowed to cover weight loss. Those rebates ramp up over that time. And we look at it constantly and make sure the contracts have escalators each year, even when they're a three-year agreement, which typically they're at least three years. But, Chairman, you're exactly correct. And look, when you put it to market and, you know, your incumbent, in this case, is, you know, able to evaluate on a carved-in basis, and hopefully they sharpen their pencil significantly and the outcome is good for the employees and the city and the taxpayers. Okay, as you look down, we'll go, let's go left to right. The medical repricing, this is kind of the order we did it. You'll see that both our carrier-reported repricing as well as a tool that we have to look at discount analysis as it relates to provider network showed that your incumbent medical administrator, also known as Blue Cross or Florida Blue, had your lowest overall allowed cost. I think it was great to validate that. You've got about a little over 72% overall discount as it relates to, and clearly in the hospital or inpatient care is where that really matters. So our stated recommendation is and was to maintain your ASO relationship. That's another acronym for your carrier or your third-party administrator who offers the deepest discount arrangements. And as you look at it, and a good question earlier that came from either Councilman Diamond or Chair Salem on this is that you've really got a three-legged stool. You've got, obviously, your TPA, which clearly, in what I just stated, we feel real good about. You've also got two carved-in components as it relates to your PBM, and then the third would relate to your stop-loss. And we're not saying that it's extremely uncommon to have one or both of those carved in, but from what we've seen in the marketplace, particularly in the stop-loss market and the PBM market, is that many take cases, those are carved out. There are a lot of players there, and they're able to offer some significant savings. As you look at subsidiaries in government, you'll see that we identified about 250 additional employees across three entities in the COJ benefits program. Best practices aside, it includes separate experience tracking, clear funding, written participation agreements, and transparent reporting. Obviously, it's the decision of the city on whether such entities continue to be offered benefits under the city's plan and what that looks like from a compliance standpoint. That's why we put in there that middle bullet point about governmental plan status and partnering from an ARESA standpoint. Okay, and then as you go to the last piece here about population benchmarking funding, we significantly covered that today. And, you know, from a contribution standpoint, particularly as also as it relates to plan design strategies in terms of how each plan is structured. Overall recommendations. You will see that, you know, clearly on the first bullet point, this just reiterates what we mentioned in terms of your ASO or carrier provider. Once again, that being Blue Cross, that the city is in the right spot there at this time. The second recommendation was the PBM marketing carve-out. You'll see that it speaks to, you know, some pretty significant savings there based on how your rebate and your some changes that were made in these last plan years result. Could that be reduced some and come underneath that $5.2 or so million? If so, we still think there's a great opportunity there. And the administration could be under further negotiations or have been over these last six months. The third thing would be funding and contributions. Look, you know, to me that's been the biggest issue and I think what alerted, you know, not just the city council, but that the city, a lot has changed since, you know, y'all selected us to conduct this effort, particularly with the property tax, you know, reform of constitutional amendments. So I would think what Mr. Parks mentioned earlier is these numbers are real. You saw the contributions of roughly about 75%. I want to say, and I think this was covered by Mark Bailey or Sabrina in the prior meeting, that seemed to be on top of what their broker, Gallagher, had suggested based on some information we got from the insurance committee level. So I don't think there's any conflict there or disagreement. However, there's really only a few ways to get there. And clearly, to not put it on the backs of just the employees over a period of time, which I think is the wise way to do any of this, you know, you've clearly got some ways. I think you continue to make your plans more cost effective, whether it's plan designs, whether it's the stop loss, whether it's the PBM and the pharmacy. Could some of that have a little disruption to the end user, the member? Sure, it can. We've outlined a lot of that, particularly on the pharmacy side. But we're seeing all other employers, public and private sector, make such changes over time. And clearly, that will impact, quite frankly, budgetarily, what the share is from the employee and from the employer. If some of these changes are made, obviously, that will reduce the burden on the employee and the city or the taxpayer. And then you mentioned you see the stop loss marketing, just echoing that. And look, I think that over a period of time, over a number of years, it's clear that the employee contribution side and the plans largely were kept the same, and there wasn't a lot of changes, and we've just seen so much volatility from high-cost claimants, pharmacy spend, and some of the pressures budgetarily for the city that look like that may continue or get worse, that now you've got a little bit of the perfect storm. And I think in terms of, once again, what the auditor's office and, you know, has spoke about as well as this committee to kind of right size, but also really, truly know what you're paying for and what it costs to run your plan and your program and what's affordable for the employees and the city chairman and the committee is most important. And if that occurs with, you know, the, you know, tasks we've completed, I think it's good for everybody. So thank you, and we'll answer any questions. And, again, the Bailey Group and, you know, our parent company, NFP and Aon, greatly appreciate the opportunity. We've learned a lot and taken a lot of pride in this exercise. Thank you. First of all, let me thank Travis. Thank you and the team. I've enjoyed this whole analysis. It just proves to me that there are significant savings here that go well beyond impact on the employee and their dependents. There are a lot of other things that can be done to save money that, and you just pointed them out, that could be implemented without too much disruption to the people. I've got, Mary, did you want to say anything? Yes. Thank you. Through the chair, with respect to the additional organizations that participate in our benefit plan, we did reach out to our ERISA attorneys and OGC and ask them to kind of take a look at it. The three entities were First Coast Workforce Development Consortium, Northeast Florida Regional Council, and the Jacksonville Housing Authority. And the discussion was with respect to whether or not their participation in our program would in any way jeopardize our status as an ERISA-exempt governmental plan. And after doing that analysis, they didn't have a lot of time, but based on the information available to them and all the factors that they looked at, they determined that extending the opportunity for the employees of those organizations to be a part of our benefit plan would not compromise our status as an ERISA-exempt governmental plan. So I think that puts to bed that discussion. I just wanted to get that on the record for the committee. Okay. And, Mary, thanks for that. And your office always does an excellent job. We've worked with you in some other capacities, and that is what we suspected. But we wanted in our role to be, you know, be real careful, make sure that strong legal counsel looked at it. We'll say that obviously that's the city's decision, obviously, and I would run that by Mary in the office to decide whether you continue to offer those employees. But I think the biggest question would be is ensuring that they're priced correctly, right? And from a contribution side that those entities are paying their responsible share. And I think they understand that. You know, a lot of good people with these three entities, about 250 employees. So I think kind of shine a light a little bit about that so the policymakers and the administration can continue to make decisions was the path forward. But thank you. I hope you won't mind taking a phone call or two as we get into the budget process. I feel certain that one or many of us might be reaching out to verify some numbers and that kind of thing. So, but again, thank you so much, Travis. It's been a great experience. And I see no one else in the queue. So we will adjourn. Thank you. Thank you all. Appreciate it. Thank you.