Title
Dept/ Agency: Administration/Division of Personnel
Action: ( ) Ratifying (X) Authorizing ( ) Amending
Type of Service: Extraordinary Unspecifiable Services (EUS)
Purpose: Contract for Health Insurance Benefits to provide a Health Plan
Entity Name: Insurance Design Administrators (IDA)
Entity Address: 111 Bauer Drive, Oakland, New Jersey 07436
Contract Amount: Estimated Annual Costs of $56,465,795.75
Funding Source: NW011-200-2002-A-60210-B2025
Contract Period: July 1, 2025 through June 30, 2028
Contract Basis: ( ) Bid ( ) State Vendor ( ) Prof. Ser. (X) Insurance
( ) Fair & Open (X) No Reportable Contributions ( ) RFP ( ) RFQ
( ) Private Sale ( ) Grant ( ) Sub-recipient ( ) N/A
Additional Information:
body
WHEREAS, the City of Newark (the “City”) desires to enter into a contract to provide its eligible employees, eligible retirees, and their eligible dependents represented by the various bargaining units with which the City negotiates and eligible unclassified personnel with an option for a more affordable managed care health plan; and
WHEREAS, the City through its brokers solicited proposals in the private market for a more affordable option for managed health care plans and stop loss coverage; and
WHEREAS, Insurance Design Administrators (“IDA”) has submitted a Proposal indicating they will provide a more affordable managed care health plan, with in and out of network benefits; and
WHEREAS, the services solicited are considered Extraordinary Unspecifiable Services, which are specialized and qualitative in nature requiring expertise, extensive training, and proven reputation in the field and are exempt from the requirements of public bidding pursuant to the Local Public Contracts Law, N.J.S.A. 40A:11-5(1)(a)(ii); and
WHEREAS, the Director of Personnel, has determined and certified in writing that the value of this contract will exceed $ 44,000.00; and
WHEREAS, this Contract is awarded without competitive bidding as an exception to public bidding, pursuant to N.J.S.A. 40A:11-5(1)(a)(ii), Extraordinary Unspecifiable Services and Local Public Contract Law N.J.S.A. 40A:11-1, et seq. requires a Resolution of the Governing Body authorizing the award of contracts for Extraordinary Unspecifiable Services and further requires that the contract itself must be available for public inspection and published in a local newspaper; and
WHEREAS, pursuant to Chapter 78, P.L. 2011 enacted on June 28, 2011, the City will offer the IDA medical plan as a lower cost alternative to the Aetna Plan; and
WHEREAS, the estimated annual administrative cost for the period July 1, 2025 through June 30, 2028 is estimated to be Seven Hundred Sixty-Seven Thousand, Seven Hundred Dollars and Zero Cents ($767,700.00) with an estimated total plan cost of Fifty-Six Million Four Hundred Sixty-Five Thousand Seven Hundred and Ninety-Five Dollars and Fifty Seven Cents ($56,465,795.57). The actual cost is contingent upon actual enrollment and claims; and
WHEREAS, Local Finance Notice AU 2002-2 (February 26, 2002) considers insurance coverage an Extraordinary Unspecifiable Service (EUS); and
WHEREAS, this contract is awarded without competitive bidding as an EUS contract pursuant to N.J.S.A. 40A:11-5(1)(m) and N.J.S.A. 40A:11-5(1)(a)(ii); and
WHEREAS, the Director of the Division of Personnel’s Determination of Value and EUS certification are attached hereto; and
WHEREAS, N.J.S.A. 40A:11-15(6) permits the award of a contract for the purchase of insurance coverage for any term of not more than three (3) years; and
WHEREAS, Local Public Contract Law, N.J.S.A. 40A:11-1, et seq. requires a resolution of the Governing Body authorizing the award of contracts that are exempt from public bidding and further requires that the contract itself be made available for public inspection; and
WHEREAS, IDA is not required to provide a C. 271 Political Contribution Disclosure Form or a Business Entity Disclosure Certificate by virtue of N.J.S.A. 19:34-32, which statutorily bars insurance companies from making reportable contributions; and
WHEREAS, although this contract is being awarded pursuant to a nonfair and open process, it, nevertheless, complies with the requirements of the State of New Jersey Pay-to-Play Law, N.J.S.A. 19:44-20.5 et seq.
NOW, THEREFORE, BE IT RESOLVED BY THE MUNICIPAL COUNCIL OF THE CITY OF NEWARK, NEW JERSEY, THAT:
1. The Mayor of the City of Newark and/or his designee, the Business Administrator and/or the Personnel Director, are hereby authorized to enter into and execute a contract with Insurance Design Administrators, 111 Bauer Drive, Oakland, New Jersey 07436 for the provision of a more affordable managed care health insurance services option, with in and out of network benefits, for all eligible active employees, eligible retirees, and their eligible dependents, for the period commencing July 1, 2025 and terminating on June 30, 2028.
2. The estimated cost of providing the aforesaid services for the period of July 1, 2025 and terminating on June 30, 2028 is Fifty-Six Million Four Hundred Sixty-Five Thousand Seven Hundred and Ninety-Five Dollars and Fifty Seven Cents ($56,465,795.57), which is subject to change based on actual enrollment and claims.
3. A copy of the fully-executed contract shall be filed in the Office of the City Clerk by the Personnel Director.
4. The contract is awarded without competitive bidding as an Extraordinary Unspecifiable Service contract pursuant to N.J.S.A. 40A:11-5(1)(m) and N.J.S.A. 40A:11-5(1)(a)(ii), and is exempt from New Jersey State Pay-to-Play requirements by virtue of N.J.S.A. 19:34-32.
5. Any and all documents pertinent to the entering into and execution of the contract shall be filed in the Office of the City Clerk by the Personnel Director.
6. Attached hereto the Finance Director’s Partial Certification of Funds stating that funds in the amount of $100,000.00 are available in the 2025 Temporary Budget in account number: Bus.Unit NW011/Dept. 200/ Div./Proj.2002/Activity A/ Acct # 60210/ B2025 for the purposes stated in this Resolution. Pursuant to N.J.A.C. 5:30-5.5(a)(2), immediately after the 2025 Final Budget is adopted, a written certification of available funds shall be prepared for the remaining balance and filed with this Resolution. Pursuant to N.J.A.C. 5:30-5.5(d)(1)(ii), in subsequent fiscal years, a written certification of available funds shall certify the availability of all funds to be charged to the budget for that fiscal year. The contract authorized by this Resolution shall be subject to the availability and appropriation annually of sufficient funds both in the 2025 Final Budget and in each subsequent fiscal year.
7. There shall be no amendments or changes to this contract without approval from the Municipal Council.
8. There shall be no advance payments on this contract in accordance with N.J.S.A. 40A:5-16.
9. A notice of this action shall be published in the newspaper authorized by law to publish a legal advertisement and as required by law within ten (10) days of its passage.
10. The City Clerk shall provide the appropriate Notice of Award of the contract to the State Comptroller, no later than twenty (20) business days following such award, in accordance with N.J.S.A. 52:15C-10 and the Notice of the Office of the State Comptroller dated May 7, 2008.
STATEMENT
This Resolution authorizes the Mayor of the City of Newark and/or his designees, the Business Administrator and/or the Personnel Director, to enter into and execute a EUS contract with Insurance Design Administrators, 111 Bauer Drive, Oakland, New Jersey 07436, for the provision of managed care health insurance services, with in and out of network benefits, for all eligible active employees, eligible retirees, and their eligible dependents, for the period commencing July 1, 2025 and terminating on June 30, 2028, at a cost not to exceed Fifty-Six Million Four Hundred Sixty-Five Thousand Seven Hundred and Ninety five Dollars and Fifty Seven Cents ($56,465,795.57). The contract is awarded without competitive bidding as an extraordinary unspecifiable service contract pursuant to N.J.S.A. 40A:11-5(m) and N.J.S.A. 40A:11-5(1)(a)(ii).