Low Bid Gets The Business

A recent post on this blog, Low Bid Gets The Business, described the Kingsville ISD’s search for an insurance consultant.

Included in the RFP for Insurance Consultant was a scoring grid assigning 40 points to the lowest bid and 25 points for reputation.

The school district received three bids. At a board meeting last week there was an agenda item to “Approve Insurance Consulting Contract.”

Price dominated the discussion. This is a clasic example of chasing nickels and dimes.

Kingsville ISD would be wise to be hell bent on pricing for medical costs instead of suffering the angst of spending $25,000 to hire an insurance expert. But they’re not. Their mindset proves their ignorance. Going to bid for health insurance under the guidance of an “expert” simply leads to a spread-sheet decision that never ends up saving money. Health care costs continue to increase every year through status quo strategies and it doesn’t  matter who they hire as a health claims manager (Carrier or TPA).

The KISD health plan is a huge budgetary expense. Their current broker (Gallagher) has not been successful in keeping costs static, failing to save the district money. Changing a logo on a health insurance I.D. card will have no budgetary consequence.

As long as KISD chases nickels and dimes they will fail to control health care costs. They would be wise to hire a consultant willing to work with them on the basis of guiding them away from status quo solutions towards a path of change leading to lower costs and improved benefits.

Watch what happened here: Kingsville ISD Discusses Hiring Insurance Consultant(Go to 1:11:30)

 

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