McAllen ISD To Interview Top 3 Consultant Finalists

By Molly Mulebriar

McAllen Independent School District in deep South Texas is set to interview the top three finalist for the district’s insurance consultant position this week. MISD employee benefit program is self-insured and administered by Blue Cross & Blue Shield.

Wednesday, February 20, 2019 8:00 AM
Board Room/Administration Building of the McAllen Independent School District, 2000 North 23rd Street, McAllen, Texas
1. CONVENE IN OPEN SESSION
2. INTERVIEWS AND RANKING FOR REQUEST FOR QUALIFICATIONS 2018-121 INSURANCE & EMPLOYEE BENEFITS CONSULTING SERVICES AND AUTHORIZATION FOR STAFF TO NEGOTIATE AN AGREEMENT WITH THE HIGHEST RANKED FIRM
Item Submitted: Todd Miller, Assistant Superintendent Human Resources
 2018-121 BAI – Interview (CVR)
 2018-121 BAI – Interview (ATCHMT)
3. ADJOURNMENT

Insurance consultants are not unbiased although some would argue the opposite is true. In looking at past performance it is fairly easy to predict what a consultant’s recommendation will be.

HISTORY REPEATS ITSELF

If it’s true that history repeats itself, Gallagher Benefit Services in South Texas will recommend Aetna or it’s wholly owned TPA subsidiary. HUB will recommend United Healthcare (To our knowledge HUB has never recommended an independent TPA in the South Texas market). Valley Risk will recommend an independent TPA.

THE PURPLE FISH

Valley Risk Consulting, with a history of almost always recommending independent TPA’s, does so because  proven out-of-the-box solutions can only be supported by independent TPA’s and which, of course, is entirely outside the purview of status quo competitors. Valley Risk is the Purple Fish.

IT’S NOT CHOOSING A CONSULTANT, IT’S CHOOSING AN OUTCOME

It would be wise of McAllen ISD to consider each contender’s past recommendations and consider the basis upon which those recommendations were made. This will provide comfort for board members whose pre-determined preferences are almost always kept below the surface only to be disclosed when they exercise their vote.

I wanna stay with BCBS so who is the consultant most likely to support me?” or “I like United HealthCare because PSJA, Brownsville and other local districts are with UHC, so which of the three candidates will likely support my vote for UHC?” or “I don’t believe in magic and want to try something different to improve benefits and reduce costs at the same time, so which candidate thinks out-of-the-box and can deliver?”

SMART MONEY ODDS

If BCBS is perceived to have done a “good job”, and employees are happy, then common sense dictates the Board of Trustees will likely retain Valley Risk, their current consultant. After all, moving to another BUCA with the same ole same ole won’t make much sense and would not be worth the trouble (is my doctor in-network and do I have to change doctors?).

If a financial decision must be made as an essential decision pivotal point, Valley Risk Consulting should win the bid hands down because the need for out-of-the-box strategies that only Valley Risk will bring to the table will be apparent.

Smart money has Valley Risk at 5 to 1 odds.

THE ELEPHANT IN THE ROOM

Then, of course, there are other factors that can influence consultant selection. This includes lobbying by insurance agents hoping “their man” gets the nod. Turning commission dollars into cash campaign contributions betting on the 19th hole has been known to be an effective ploy. Hospitals  too may exert pressure to stay within the status quo and will push for the carrier that pays the most. And, of course, there are the local agent cartel/s who have been known to monopolize the health insurance bidding process stacked towards pre-determined outcomes. This is done by controlling the market through multiple agents working in unison. It’s like bidding on Black and Red at the same time thus never losing.

MAKING HAPPY

But at the end of the day, the philosophies of both the plan sponsor and the consultant must necessarily mirror each other in order to please all involved. Being happy is often more important than being solvent. Me Too Consultants increase their odds in winning jigs with “Oh, you like BCBS? Well I do too! or “Oh, you hate BCBS? so do I!

MULEBRIAR’S TWO CENTS WORTH

In our opinion, if MISD wants to do something different other than the old tried and failed practices of the past 35 years, then to that end Valley Risk Consulting should be awarded the winning bid.

WHY IT DOESN’T MATTER

Life as an insurance consultant working with deep South Texas school districts can be less than satisfying. Consultant recommendations have been known to be overruled fairly often by school board members for no outward or apparent reasons. In those cases we suspect board members end up realizing they erred in their judgement of understanding who they hired in the first place.

ABOUT VALLEY RISK CONSULTING

Valley Risk Consulting is the largest independent risk management consulting firm in South

Texas, headquartered in McAllen. We serve several of the largest school districts in the region and have a combined experience level of over 45 years, specializing in Political Subdivisions and Third Party Administration.

 

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