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MOTION AUTHORIZING THE CITY MANAGER TO EXECUTE NON-EXCLUSIVE AGREEMENTS WITH ALSHIFA MEDICAL GROUP AND DAMERON HOSPITAL ASSOCIATION TO PROVIDE OCCUPATIONAL HEALTH SERVICES
recommended action
RECOMMENDATION
It is recommended that the City Council approve findings and by motion authorize the City Manager to execute a non-exclusive Agreement with Alshifa Medical Group, Inc. (“Alshifa”) (Attachment A) and a non-exclusive Agreement with Dameron Hospital Association (“Dameron”) (Attachment B) to provide occupational health services. Contracting with two (2) vendors will allow the City to utilize the services of either vendor, thus expanding the City’s network of services beyond the current structure. It is also recommended that this motion authorize the City Manager to take actions necessary and appropriate to carry out the purpose and intent of this agreement.
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Summary
The City has a current agreement with Dameron for occupational health services that expires on December 15, 2015. The Request for Proposal (RFP) was issued on July 6, 2015. On August 17, 2015, the Selection Committee (“Committee”) interviewed two responsive vendors and unanimously agreed it would be in the best interest to the City of Stockton (“City”) to use both vendors for the full range of services at the City’s discretion. The RFP did not state this would be an exclusive contract, so, if approved, both non-exclusive Agreements will commence on December 16, 2015, and continue for three years (December 15, 2018), with an option to extend for two (2) additional one-year option periods, for each vendor.
DISCUSSION
Background
The City has had a long-standing contract with Dameron to provide ongoing professional medical occupational services for the City. The last contract was for five years with the option to extend for two (2) additional one-year option periods. The City and Dameron have utilized both option periods and the final renewal year is due to expire on December 15, 2015.
Pre- and post-employment occupational health services include: Applicant pre-employment physicals and drug screens; a variety of periodically required annual physicals as required by the Department of Transportation (DOT); Bomb Squad personnel physicals; Fire Department annual wellness physicals; annual on-site pulmonary function testing; annual on-site flu shots for self-funded plan participants; fitness for duty evaluations and reports; DOT required random drug testing and Medical Review Officer (MRO) services; hepatitis and HIV occupational exposure testing, counseling and follow-up; expert witness testimony before a commission or court; medical file/record maintenance; research on new occupation health issues; and other services as required. Required post-employment occupational health services are provided based on legal requirements and/or negotiated labor agreements and are determined by an employee’s job classification and/or duties. The occupational physician may also be called upon to fulfill the role of “City Health Officer” for Code Enforcement/Public Health consultation purposes.
Present Situation
Dameron has been the City’s occupational services provider for over twelve (12) years. Dameron’s contract was amended on December 16, 2013, to simplify the method for renewing existing optional extensions, update the scope of services, and revise the Fee Schedule. The current agreement ends December 15, 2015.
To ensure all vendors who specialize in occupational services were afforded an opportunity to submit a proposal to render services for the City, the RFP process was utilized. An RFP was issued on July 6, 2015.
In response to the RFP, we received inquiries by multiple vendors, however, the City received only two (2) proposals by the established due date: Alshifa Medical Group, Inc. and Dameron Hospital Association. The Committee reviewed the proposals and subsequently conducted vendor interviews with both. The selection committee consisted of a Deputy Fire Chief, Deputy Police Chief, Interim Deputy Director of Human Resources, Supervising Human Resources Analyst - Benefits, Risk Analyst, and Human Resources Analyst - Benefits.
On August 17, 2015, the Committee interviewed both vendors and asked questions based on the needs of the City and responses to the RFP. After interviewing both vendors and evaluating their responses, the Committee came to an unanimous decision that it is in the City’s best interest to utilize both vendors at the City’s discretion.
Alshifa staff has experience with all occupational services requested by City staff, including random drug tests, which is a state law under the Department of Transportation.
Dameron has been successful in conducting the Fire Department’s annual physicals and meeting their needs of scheduling and completion. The Committee agreed that continuing a contract with Dameron would allow for a continuity of care due to an already established program.
The Committee recommends that Alshifa and Dameron should be utilized for occupational health services based on both of their qualifications, staff experience, and understanding of the City’s unique needs. Alshifa employs two (2) physicians, one (1) physician’s assistant, and six (6) support staff members who have previously worked with the City under the existing Dameron contract. In addition, the urgent care facility Alshifa utilizes has extended hours that allow for some services to be rendered outside the normal business hours. Dameron has two (2) physicians, one (1) physician’s assistant, and thirteen (13) support staff members. Both vendors have knowledge of the City’s needs and many years of experience providing occupational health services. The City will have the ability to render services as necessary from Alshifa and Dameron, by contracting with both vendors. The ability to divide the work offered in the RFP allows the City to expand its network of qualified occupational health providers. Both parties agreed to non-exclusive contracts.
Findings
The RFP process was utilized as an exception to the competitive bidding process, under Stockton Municipal Code section 3.69.070(A)(3), Negotiated Contracts Following Solicitation of Competitive Proposals. Staff requested the RFP process based on the following findings:
1. A strict cost competitive basis for the selection of occupational services providers may lower the quality and thoroughness of the services provided.
2. These types of services require experienced professionals who have handled such services for other public entities who can work closely with City staff.
3. It is necessary for the City to hire outside professionals to handle these services as City staff does not have the full expertise to perform these services.
The City’s healthcare consultant, The Segal Company (“Segal”), has completed a cost analysis based on the specific quotes provided by the vendors for anticipated services, but this costing information was not distributed to the Committee prior to the RFP evaluation and interview process. This allowed the Committee to determine which vendors’ services best fit the needs of the City without taking cost into consideration. After the interviews, Segal released the cost information. The analysis found that the costs were nearly identical, so it could not be used as a factor in selecting a vendor if all other factors were ranked the same.
FINANCIAL SUMMARY
Expenditures for occupational services are based on the number of new hires and requirements for testing for various job classes, and vary slightly year to year. These expenditures will be based on the scope of services and the compensation for each vendor. Occupational health services have an approximated yearly expense of $172,000. Funds have already been appropriated to cover the cost of these services for fiscal year 2015/2016 in the following budgets:
• Human Resources General Fund (pre-employment services for full-time employees)
• Internal Services Fund Workers’ Compensation Safety Program (Department of Transportation examinations, audio examinations)
• Municipal Utilities District (pre-employment physicals, non-Department of Transportation examinations, Department of Transportation examinations, Hepatitis immunizations, hazmat examinations)
• Community Services Recreation Fund (pre-employment services for part-time employees)
• Fire Department General Fund (annual wellness physical examinations)
Attachment A - Alshifa Medical Group, Inc. Services Agreement
Attachment B - Dameron Hospital Association Services Agreement