REPORT/RECOMMENDATION TO THE BOARD OF SUPERVISORS
OF SAN BERNARDINO COUNTY
AND RECORD OF ACTION
June 11, 2024
FROM
VICTOR TORDESILLAS, Deputy Executive Officer, Department of Risk Management
SUBJECT
Title
Renewal of Medical Malpractice Insurance Program
End
RECOMMENDATION(S)
Recommendation
1. Approve the renewal of the Medical Malpractice Insurance Program with BETA Risk Management Authority with $25,000,000 in coverage limits for each occurrence and $35,000,000 annual aggregate limit, inclusive of a $1,000,000 self-insurance retention, for a premium of approximately $2,113,860, for the one-year period of July 1, 2024 through July 1, 2025.
2. Authorize the Deputy Executive Officer or the Director of Risk Management to execute the binding order on behalf of the County.
(Presenter: Victor Tordesillas, Deputy Executive Officer, 386-8621)
Body
COUNTY AND CHIEF EXECUTIVE OFFICER GOALS & OBJECTIVES
Operate in a Fiscally-Responsible and Business-Like Manner.
FINANCIAL IMPACT
Approval of this item will not result in the use of Discretionary General Funding (Net County Cost). The total premium of approximately $2,113,860 will be paid from the Department of Risk Management’s (DRM) medical malpractice self-insurance fund (4102) and will be recovered through Board of Supervisors (Board) approved rates charged to user County departments. Sufficient appropriation and revenue have been included in DRM’s 2024-25 recommended budget.
BACKGROUND INFORMATION
The DRM administers the County’s self-insurance program for medical malpractice and procures excess insurance policies for additional protection. On May 23, 2023 (Item No. 84), the Board approved the renewal of the medical malpractice insurance program, for a total estimated premium of $2,020,089, for the one-year period of July 1, 2023 through July 1, 2024.
Approval of Recommendation No. 1 will provide a new coverage period of July 1, 2024 through July 1, 2025, for a total renewal premium cost of approximately $2,113,860. This represents an increase of $176,545 or approximately 9.1% over last year’s final premium cost of $1,937,315. The increase is primarily due to a rate increase from BETA Risk Management Authority (BETA) being applied to all members’ premiums and a 1.7% increase in overall census exposures, such as the number of residents, acute care beds, childbirth deliveries, emergency department visits, and outpatient clinic visits. The County anticipates an offsetting credit as has been received in the past, which can be up to 6% for employee completion of carrier subsidized education modules. The credit calculation will not be finalized in time to be reflected in the current estimate. The recommended renewal will maintain the current coverage limits of $25,000,000 per occurrence and $35,000,000 annual aggregate, inclusive of a $1,000,000 self-insurance retention (SIR). The DRM recommends the renewal of the medical malpractice insurance program to protect the County’s financial assets from liability arising from medical services provided by employees and contractors.
Approval of Recommendation No. 2 will authorize the Deputy Executive Officer or the Director of Risk Management to execute the binding order on behalf of the County, ensuring a timely renewal process with no lapse in coverage to ensure continuous coverage for the County’s medical malpractice insurance program.
PROCUREMENT
On November 16, 2021 (Item No. 62), the Board approved contracts with various insurance brokers, including James + Gable Insurance Brokers, Inc., for the period of December 11, 2021, through December 10, 2026.
James + Gable Insurance Brokers, Inc., successfully marketed and negotiated the renewal of the medical malpractice insurance program for the period of July 1, 2024 through July 1, 2025, with BETA. The proposed renewal policy will have the same limits and self-insurance retention as the expiring policy and will retain the same retroactive date of November 1, 2000, which ensures coverage for any claims made back to that date.
REVIEW BY OTHERS
This item has been reviewed by County Counsel (Laura Feingold, Chief Assistant County Counsel, 387-5455) on May 6, 2024; Purchasing (Leo Gomez, Purchasing Manager, 387-2063) on May 9, 2024; County Administrative Office (Diane Rundles, Assistant Executive Officer, 387-5572) on May 9, 2024; Finance (Ivan Ramirez, Administrative Analyst, 387-4020) on May 10, 2024; and County Finance and Administration (Paloma Hernandez-Barker, Deputy Executive Officer, 387-5423) on May 23, 2024.