Broward Sheriff Israel makes winners out of Coventry Health Care, lobbyist Rubin

By Dan Christensen, BrowardBulldog.org 

Broward Sheriff Scott Israel has named incumbent and low-bidder Coventry Health Care of Florida as his choice to provide group medical insurance to BSO’s 5,800 employees – a contract worth more than $355 million over the next five years.

Israel directed BSO staff to enter into contract negotiations with Coventry on Friday after receiving rankings from an internal selection committee “and input from our labor union partners,” according to sheriff’s General Counsel Ron Gunzburger.

The Coventry deal marks the second large contract the sheriff has handed down in as many months.

In August, the sheriff chose Miami-based Armor Correctional Health Services to provide healthcare services to inmates at the Broward County Jail at a cost of about $143.6 million over five years. Unlike Coventry, Armor was not the low bidder.

Israel’s selection of Armor, and now Coventry, were big wins for those companies. But the sheriff’s choices also delivered huge victories to Fort Lauderdale lobbyist, William Rubin, who Israel hired in February for $7,000-a-month to lobby for him at Broward County.

The reason: Rubin’s other lobbying clients include Armor and Coventry.

Sheriff’s officials previously have said those conflicting relationships would nonetheless have no impact on the sheriff’s decision-making.

“It was made very clear that (Rubin and his firm) could not play any role in lobbying BSO on behalf of any of their other clients,” Gunzburger told BrowardBulldog.org after Rubin was hired.

Coventry’s bid proposed that BSO pay an annual premium of $71 million for medical and prescription drug coverage in 2014. That was $8.6 million less than that of its closest competitor, Humana Health Insurance. Cigna bid  $80.2 million; United Healthcare bid $82.5 million.

Coventry’s bid is about $1 million less than it currently charges, according to BSO.

Coventry has provided group medical benefits to BSO employees for 20 years under different names. HIP Health plan, which won the bid in 1993 under Sheriff Nick Navarro, merged in 2000 with other health benefit companies and became VISTA Healthplan. In 2007, VISTA was bought by Coventry, a Maryland-based firm with an office in Sunrise.

On May 7, Coventry was acquired by insurance giant Aetna in a deal valued at $8.7 billion when it closed, according to the Bloomberg news service. 

“Coventry continues to be focused on helping BSO manage their dollars, enabling a sustainable, long-term benefits program,” Coventry Florida Chief Executive Christopher Ciano told Israel in a July 8 bid cover letter.

The contract to be negotiated with Coventry is for three years with two one-year renewal periods upon mutual agreement.

In the past, BSO asked bidding companies to provide specific dollar bids for each year of a proposal. Under Israel, bidders have been told to submit only one-year prices.

Without specific annual pricing, cost comparisons over the life of the contract are difficult. The final cost of such contracts is further obscured because, as a BSO spokesman has said, “the entire contract, including the contract amount, is subject to negotiation.”

Further clouding the ultimate amount BSO will pay are two alternative proposals that Coventry included in its bid proposal that will now be negotiated.

Those plans, featuring higher coverage levels for prescription drugs, would raise BSO’s annual cost more than $3 million to between $74.4 million and $74.8 million. The plans would lower “co-payments and deductibles to go toward maximum out-of-pocket enhancement.”