Sunday, April 5, 2009

Bid Rigging at College of DuPage (Health Insurance Broker)

Background

The requests for proposal were due on March 25, 2008. According to the RFP, "There will be no public opening of any proposals received." The College has "approximately 950 benefited employees and 50 retirees," and provides Blue Cross/Blue Shield. According to Section V, Instructions, of the the RFP, "The College expects the vendor to be able to deliver the current level of employee health insurance benefits as described in the College of DuPage Comprehensive Group Benefit Plan."

The RFP asked brokers to:

1. List the top 4 carriers, in relevance order, that you would propose to the College of DuPage to enable your firm to provide the scope and magnitude of the coverages and services required by the College of DuPage employee health plan coverages and services required by the College of DuPage employee health plan with the best possible service at the best possible cost.

2. Identify the length of your relationship with each of the Third Party Administrator and/or Health Insurance Provider listed above.

3. Provide a rationale for the selection of your top 2 carrier choices.

Since the college could not change from BC/BS until current employee contracts expire in 2011, we're unclear as to why Purchasing wanted carriers other than BlueCross.

Under the Proposal Evaluation section of the RFP:

The second step of the RFP includes assigning one or two health insurance providers to each identified broker to negotiate the best costs and services for the College based on the existing health insurance plan for the College's employee medical insurance needs...The College's objective is to select a firm who will provide the best possible service at the best possible cost while meeting the Request for Proposal specifications. The College is not obligated to award the contract based on cost alone. The College of DuPage reserves the right to accept or reject any or all proposals and to waive formalities and select the firm that best meets the needs of the College and its employees.

The Bids

Corporate Benefits Consultants "secured initial quotes from our assigned carriers in time for the original deadline of May 12, 2008." CBC had been assigned United HealthCare (remember, the school uses BlueCross/BlueShield) and Guardian Dental. CBC submitted some additional comments with its package:

"As a final comment, our top priority and objective is to present and make recommendations to our clients only after gathering all possible opportunities and diligent review of the facts. We often compete for business through the RFP process and make every attempt to fully comply with the expectations set forth in the RFP.During this process with College of DuPage, we have been assigned United HealthCare and Guardian as the markets we can approach on behalf of COD. As previously stated we are in the process of fully reviewing and evaluating both of these carrier's offerings.We believe each of these carriers assigned to us, will in fact put their best offer on the table for COD. However, we would be hesitant to recommend either carrier over other carriers in the marketplace without having the opportunity to thoroughly review and compare side by side. On the same note, we would not want to be hired based on "luck of the draw." In other words, have COD make a decision to hire CBC just because we were assigned a particular carrier that came in with the best rates for the current year when in fact it may not be the best decision for COD in the long run.

Mesirow Financial was assigned Aetna and Cigna. Byrne & Byrne, the firm that Trustee Joe Snyder brought in as the interim broker, was assigned Blue Cross/Blue Shield and Humana. Guess who received the contract as insurance broker? Why weren't all three firms bidding using Blue Cross/Blue Shield?

Monday, October 13, 2008

COD trustee lets loose

Daily Herald
October 14, 2008
By Catherine Edman

College of DuPage Trustee Kory Atkinson got up from his board seat Monday night, walked to the lecturn and charged that fellow trustee Kathy Wessel is behind recent protests by the community group DuPage United.

Wessel, he said, appears to be orchestrating protests against the board's actions because she's a past member of the group and its protests mirror her views. She denied his claims.
Members of DuPage United have appeared at board meetings since July questioning trustees' decision to remove former President Sunil Chand from his job and to then launch a search for a new president.

Atkinson said "circumstantial evidence would suggest that Wessel is behind their protests."
He also said he believes DuPage United is a front for the Illinois Education Association, of which Wessel also is a retired member. The IEA is the statewide organization representing teachers unions. It's also the bargaining unit attached to the COD Faculty Association.

In stepping away from his board seat, Atkinson pulled out a recent article from the school's student newspaper "The Courier" and said he wanted to show student journalists, who wrote a lengthy article about the recent protests, how to be thorough. Atkinson then, on the laptop and projector on the lectern, went to the DuPage United Web site, showed a several-years-old photo of Wessel with the group, and said the organization has a political agenda student journalists should question.

She helped co-found the group and in the past was co-chairman and a member of its steering committee.

Wessel denied having any current involvement with DuPage United. Debra Fulks, co-chairman of their group's steering committee, said outside the board meeting that Wessel has not attended any of their meetings on the matter and they do not send her e-mails about their stand.

DuPage United is an umbrella organization of churches, mosques, synagogues, education associations and unions.

After making his presentation, Atkinson finished by saying people need to know the group is "somewhat connected with a trustee" and "politically motivated."

When it was over, Wessel responded.

"I have never hidden any of my connections with the IEA, of which I'm a retired member. I've never hidden any of my connections with DuPage United," she said. "I have not been an officer of that organization for some time."

It's unusual, at best, for trustees to attack one another publicly - at least overtly. Atkinson, though, said his presentation was not an attack, but a way to be informative.

"Don't you think the public ought to know a trustee is orchestrating an effort?" he asked after the meeting.

Since the board removed Chand from his job in May, transferring him to president emeritus, no one has spoken publicly about the reasons.

Atkinson also threw down the gauntlet in that matter as well, saying he'd make a motion for the board to wave its "non-disparagement agreement with Chand" if Chand also would agree to do so.

If that is done, Atkinson said, he would recommend "the immediate release of all records related to Chand's performance and transfer."

Wessel was the lone board member voting against Chand's removal last spring.