County Expands EAP through Psychological Resource Associates

In striking contrast to the claims made by staff at the city of Davis back in January, Yolo County continues to receive its Employee Assistance Program (EAP) through Psychological Resource Associates (PRA).

If you recall, city staffer Melissa Chaney made the claim that PRA was not Knox-Keane certified and that this lack of certification meant they could only offer limited services (also see). We later discovered that in fact that was not true and that PRA was exempt from the certification standards since they were a pay-per-service operation.

This week, the County Human Resources department announced additional benefits available to employees through the EAP provided through Psychological Resource Associates.

Some of these programs include: Financial Counseling including credit counseling, first-time homebuyer Workshops, identity theft counseling, default and foreclosure counseling.

They also provide legal information and services through Legal Match, which is a national company that provides their clients with an extensive law library written for the consumer of legal services with over 220 legal topics. These topics include general information in layman's terms to better help the employee understand the law. Legal Match also provides a referral services to refer employees to lawyers in the area.

The claim that the city of Davis was making in terms of PRA's lack of certification was an odd one to begin with given the number of local governance bodies served by PRA and the fact that Dr. Dean Dickerson and his colleagues at PRA are individually licensed by the State of Californian to provide EAP services. Yolo County continues to receive their Employee Assistance Program through PRA and it is clear that PRA offers a wide variety of services in addition to just short-term psychological care. Several other local governing bodies also receive their EAP services through PRA.

The City of Davis claimed that they wanted a more versatile program for their EAP, however it is clear to many that an HMO or national insurance corporation such as Cigna is more likely to lead to a cutback in overall services than it is to expand them. It is unfortunate that the city would opt to switch their provider from a local provider to a national provider. One of the stated goals of any city should be to keep as much business as possible within the hands of local business. Not only does that encourage local business and improve the local economy, but often local businesses do a better job even if they may not have the economies of scale to things cheaper. As our numbers indicate, it appears Cigna would at the very least lose some money in the contract that they signed with the city. That should have been viewed with much more suspicion by the Davis City Council and city staff than it was.

---Doug Paul Davis reporting

Examination of EAP Program Reveals Surge in Spending and Hours

Based on a tip, we made a public records request of the recent city spending on their Employee Assistance Program (EAP). An EAP is supposed to cover short-term psychological services for employees who are experiencing programs of a temporary sort. The previous EAP system was limited to eight visits per issue per year. The city in changing its provider in January, the staff report indicated it wanted an even shorter number of visits:

“The proposed EAP contract allows employees up to six visits per incident per year; our current EAP contract allows employees eight visits per year, with no per issue cap. This has allowed employees to use the current EAP provider for long term psychological counseling. The City’s desire is to only offer short term counseling for employees to help them through a traumatic event that is causing problems at work, home or both. The City has no desire to pay for employees’ long term psychological counseling.”

In January, the City Council voted to authorize a change in the vendor from the locally based Psychological Resource Associates (PRA) to the nationally based Cigna. One of the key reasons was PRA’s bid was $38,000 while Cigna’s was $14,000. (Please see the full details of these plans and some of the concerns about these bids)

At the time, our concern was of the lowball nature of Cigna’s bid, which seems in many ways to be a “loss-leader," since it would appear that they would be losing money on the bid. Large insurance companies and HMO's have been widely known to use a "loss-leader" strategy when bidding on EAP's to get their foot in the door with a customer they are not currently doing business with. Then in future years when submitting bids for the major health benefits portion of a firm's or agency's business (which is extremely lucrative) they point to their ability to substantially reduce costs as evidence of why they should be selected as the new major health benefits vendor.

However, an examination of the recent records reveals something else may be going on. Looking at the three previous full fiscal years, we see a surge in both the amount of hours billed and spending.

Year	Hours Billed	Cost
FY 2003-04	209	$22,015.00
FY 2004-05	230	$24,055.50
FY 2005-06	311.5	$33,828.51

The numbers show that suddenly from 2005-06 a surge in both hours billed and cost. The increase from 230 hours to 311.5 represents an increase of 35 percent over the previous year. While the spending increase represents nearly a 41 percent increase over the previous year.

It is important to note that the new bids were based in part off of the FY 2005-06 spending. Since last year the amount billed was nearly $34,000, the bid was $38,000. Whereas previous years the amount was considerably less and thus the bid by PRA would have been considerably less.

The question has been raised as to whether that was intentional. An audit would be in order at this point, examining why exactly the usage of this program suddenly increased by 35 percent over the previous year while the year before the figures and hours billed were fairly comparable. (There is missing data from the previous year but it would have looked similar to 2003-04 and 2004-05).

There have been suggestions that one thing that occurred in the past year is that some of the patients received more than 8 visits per year. That is one thing an audit would reveal that a public records request cannot. This appears worth examining more to see what is going on, and why the demand for this program suddenly surged in 2005-06 just as the contract was coming up for renewal and just as the city made the determination for the first time in 23 years to put the bids up in the form of a request for proposals (RFP).

---Doug Paul Davis reporting

Commentary: City Staff, Is the System Broken?

On Monday after my article appeared on the Employee Assistance Plan (EAP) situation involving a city staffer who gave false and misleading information to council about a 23 year city vendor, I received a call from a former city councilmember. That councilmember expressed both gratitude and frustration. It seems that during their tenure this was a frequent problem. The only difference back then is the no one bothered to report it. According to them, city staff would often give false information to council, sometimes it was intentionally so. Accurate information and alternative viewpoints were very difficult to obtain.

This problem is largest for those who are members of the minority faction. The majority often simply does not care how city staff operates as long as they get their agenda passed. Process goes by the wayside. At the same time, with a city manager driven system, the city council is almost and completely reliant on the advise and information provided by city staff. The council is not given their own staffers, as other systems of government including the County Supervisors provide. And while these employees are completely at-will and can be hired and fired with no cause given (as opposed to civil servants who have immense protections), it is only those who control the three votes that really have such power to force the city manager's hand.

It goes beyond simply a matter of city staff making mistakes. When we look at the water issue, one of the biggest problems is that city staff controls the flow of information to the city council. The water issue is a greatly complicated issue, as I discovered when I tried to wade through merely five years of public records on the subject.

A few things became evident from the public record. First, that city staff and not necessarily city council had vast control over the trajectory of policy. City council did pass by a 3-2 vote authorization to embark on alternative 5 in 2002. However, a stream of EIRs and MOUs led council eventually upon a very different path. City staff often had a larger role than council in guiding the trajectory of this policy.

Second, staff has been very reluctant, especially for the minority view, to provide them with alternative options. This was very clear last week when Mayor Sue Greenwald tried to push staff to provide her with answers to questions. Each time, the staff response was that we could not pursue this option. The Mayor wanted an answer to the substantive question, not an opinion on its feasibility. We should have an array of consultants that would give us different advice from the advice recommended by the staff and then the council can decide which is the best approach.

The problem of course in the case of water is that a councilmember simply lacks the expertise to understand the dynamics of the water supply and waste treatment plans. They have to rely not only on city staff, but also on consultants and lawyers to navigate through a very complex policy realm. Consultants and lawyers who are not always neutral bystanders and disinterested parties. That creates a situation where staff through their expertise serves as the gatekeeper of information and that situation puts a tremendous amount of power in the hands of an unelected city staff and removes a tremendous amount of power from the hands of people that the voters in this city elected.

Third as we have mentioned in past articles and commentary, this situation creates a perverse power structure where the City Manager is often deemed to be the chief power within the system. The City Manager not only holds the office space, controls city staff, and makes many if not most of the executive decisions that do not require council action, but the City Manager also has the power to structure debate and control the flow of information. While the City Manager answers to city council, in effect, the City Manager answers only to the strongest powers within city council, the council majority. In effect, as long as the City Manager does the bidding of the council majority, he is largely free to do as he chooses. This situation creates vast problems for council minorities who lack the power and leverage to have much say in the conduct and operations of city staff and the city manager.

More valuable even than numerical numbers is the flow of information. That flow of information is almost completely controlled by city staff working at the behest of the council majority. Without access to their own staff, the council minority not only has a numerical disadvantage, but they lack the ability and platform to be able to provide their own information to counter the message sent by the council majority.

At times, this puts the council minority at an even stronger disadvantage, because they do not even possess the information at times to counter what the council majority is doing. At other times, it has required members of the council minority to get independent assessments or do their own research. These are people who were elected by the same people who elected the council majority and people who are not being paid more than a token $500 stipend. This is not the way that these members of the Davis City Council ought to be treated.

It is clear to me that changes need to made in the structure of city government. As the complexity of governmental decisions increases, we need our council members whether they be in the majority or in the minority to be given a full array of options and alternatives so that they can make an informed decision. Unfortunately those needs are not being met by the current system.

---Doug Paul Davis reporting

City Staffer Botches Testimony To Council on EAP

The People's Vanguard of Davis has learned that when Davis City Human Resources Administrator, Melissa Chaney, told the Davis City Council at the January 16, 2007 City Council Meeting, that the city's 23 year long provider of Employee Assistance Program (EAP), Psychological Resources Associates (PRA) was not in compliance with the Knox-Keene, act she was giving out false information.

According to a letter submitted to City Manager Bill Emlen last week and copied to each of the City Council Members from PRA director Dr. Dean Dickerson, PRA is not Knox-Keene act certified because they are exempt from Knox-Keene licensing requirement. Therefore they do not need to be licensed as an HMO or a large insurance company would.

The Knox-Keene act was enacted to protect consumers (such as the city of Davis and their employees) from potential abuse from large HMOs or insurance companies who have a history of over-promising and under-performing on those promises. PRA provides health care services on a per visit basis and therefore operates as a "direct contract provider" rather than as an insurance company.

Dr. Dickerson goes on to write, "Unfortunately these large companies have used the Knox-Keene licensing issue as a false and deceptive argument to capture contracts that previously had been provided by local professional groups." Essentially, these large HMOs market to prospective clients that they are Knox-Keene licensed and the small EAP providers are not thereby implying falsely that the small provider who is providing EAP services is doing so illegally or is out of compliance with the law.

This is exactly what has happened in this case.

Melissa Chaney acknowledged that she herself had just become aware of this provision of the law, just prior to the January 16 City Council Meeting, not during the RFP (request for proposal) process which was conducted during the prior six months. While she can perhaps be forgiven for not knowing whether the law applied to PRA, it is deeply troubling that she never bothered to ask a vendor that the city had done 23 years of EAP business with for clarification on this vital issue.

When asked by Mayor Greenwald, Chaney said, "we didn't realize that this provision was even in effect, that this license was mandated until we went through the RFP process." In fact, during the RFP process (conducted during the final six months of 2006) this issue did not come up as Ms. Chaney had not requested that Knox-Keene act certification be a requirement to provide EAP services to the city of Davis. Had she included that in her RFP (request for proposal) the current provider would have informed her that the Knox-Keene act did not apply to them.

Greenwald continued to press, "and you didn't discuss this with the 23 year local provider?"

Chaney responded, "No. During the RFP process we just followed the process of going through the RFP."

City Manager Bill Emlen made the unusual statement that they were not certain about this information. He even suggested that city staff might need more information on the Knox-Keene act and whether it applied to PRA, but that he felt that the bid by Cigna stood on its own merits. However, despite his statement the suggestion that PRA was somehow not licensed, changed the tone and course of the conversation.

(Click here to see the full video clip of this exchange)

Both Mayor Greenwald and Mayor Pro Tem Asmundson were sympathetic toward local business getting contracts if at all possible but they could not justify it when they got information suggesting that the local provider was not certified.

It thus was clear that both Mayor Greenwald and Mayor Pro Tem Asmundson's positions were swayed by this particular issue--the lack of a Knox-Keene license for PRA. Asmundson stated a preference to give the process more time given the length of the relationship and the fact that PRA was a local provider. However, the concerns about Knox-Keene licensing finally swayed her to support Cigna. Greenwald remained ambivalent about it, in the end voting for both the "take no action" substitute motion made by Councilmember Lamar Heystek (to allow for further fact finding) and then finally approving of Cigna. Heystek was the only dissenter in the end.

While I too was unaware that PRA was exempt from the Knox-Keene act, I found the entire issue very unsettling because it did not make any sense that a person or firm who had been in business as long as Dr. Dickerson would be out of compliance with state licensing requirements. Moreover, PRA provides EAP services to many of the other local municipalities and other governing bodies including Woodland City, Davis Joint Unified School District, and Yolo County. To put it simply, Ms. Chaney's claims seemed dubious.

Ms. Chaney's failure to follow due diligence is fundamentally troubling especially considering that the City Council must absolutely rely on and trust the advice and information presented by the city staff. And Ms. Chaney has violated this not only by getting the information wrong, but by not making a simple phone call to PRA to clarify this issue.

Both Mayor Greenwald and Mayor Pro Tem Asmundson voted in favor of awarding the bid to Cigna and therefore can ask for reconsideration. Regardless of the merits of the Cigna bid (which I have serious doubt about in its own right), due diligence requires a full investigation into this episode to ensure that this does not occur in the future.

---Doug Paul Davis reporting

Commentary: Looking again at the EAP Debate

At Tuesday's City Council Meeting during an item discussion the approval of a new EAP Provider, Davis City Councilmember Don Saylor said:

"I find this highly unusual. We've had a reasonable process of RFP. We've had several providers have responded... The current provider had every opportunity to participate in the process. He wasn't even in the top three in terms of the price and performance. We have relied on our... human resources director to provide us with a significant amount of information. And over the past month, we've asked them to go back and review this... I have no idea of why we are considering going back to a provider that we've now heard does not have the proper certification for the service..."

Mr. Saylor is correct this is highly unusual, and frankly something does not sit right about this entire exchange.

Please see the video clip below to view this for yourself.

First, you have Melissa Chaney, the Human Resources Administrator, telling council and the public about the Knox-Keene act and how each EAP provider is required to have a license under its provisions.

Second, you have Melissa Chaney, the Human Resources Administrator, telling the council that Psychological Resources Associates (PRA) is out of compliance and does not have a license. Not only has PRA been a provider for the City of Davis for 23 years, but they also provide EAP services to several other governmental agencies including the County, the City of Woodland, the City of West Sacramento, and the Davis Joint Unified School District. So how could a company that is in the business of providing EAP services to government agencies, not be aware of Knox-Keene act requirements and be out of compliance?

So you would think that maybe Ms. Chaney would clarify this issue? Mayor Greenwald asked her point blank and she stated, "No." This is a company with whom the city of Davis had 23 years experience, why would you not at least grant the courtesy of having them clarifying the issue?

At this point clearly Mayor Greenwald is torn on this issue. City Manager Bill Emlen intervenes saying that they were actually not sure about this issue and that if this is the concern, perhaps they should wait and explore it further. But if you watch Greenwald's response, the issue of Knox-Keene is clearly very decisive. Mayor Pro Tem Asmundson is not on this clip, but she has a similar reaction.

Mr. Saylor is correct--this entire exchange was extremely unusual and it would seem that this is far from the end of this story.



---Doug Paul Davis reporting

Still Questioning the EAP Provider Switch

Council decided to turn away from a 23 year relationship with Psychological Resources and Associates (PRA), a local EAP (Employee Assistance Program) provider of short-term psychological services in favor of the national provider Cigna Behavioral Health.

As we've discussed previously, there were a few reasons why the staff recommended the switch. One was to reduce the number of visits from 8 per year to 6 per year on any one issue. The second was a savings of around $24,000.

However, at this meeting, the third time this item has been on the agenda and the second time the item has been heard, a new issue came up. Melissa Chaney, Human Resources Administrator for the City of Davis, cited a 1975 law, the Knox-Keene act, that requires all California EAP providers to be licensed. She claimed that PRA was not licensed. If a provider is not licensed under Knox-Keene, they cannot provide more than three counseling visits per six months, according to Chaney.

This was a 1975 law that original applied to HMOs, but began to be applied to EAPs in the late 1980s.

So the city of Davis apparently just became aware of this law.

When asked by Mayor Greenwald, Chaney said, "we didn't realize that this provision was even in effect, that this license was mandated until we went through the RFP process."

Greenwald continued to press, "and you didn't discuss this with the 23 year local provider?"

Chaney responded, "No. During the RFP process we just followed the process of going through the RFP."

Despite City Manager Bill Emlen insisting that we might need more information on the Knox-Keene act, it was clear that both Greenwald and Mayor Pro Tem Asmundson positions were swayed by this particular issue--the lack of license for PRA. Asmundson stated a preference to give the process more time given the length of the relationship and the fact that PRA was a local provider. However, the concerns about Knox-Keene licensing finally swayed her to support Cigna. Greenwald remained ambivalent about it, in the end voting for both the "take no action" substitute motion made by Councilmember Lamar Heystek (to allow for further fact finding) and then finally approving of Cigna. Heystek was the only dissenter in the end.

Councilmember Don Saylor:

"I find this highly unusual. We've had a reasonable process of RFP. We've had several providers have responded... The current provider had every opportunity to participate in the process. He wasn't even in the top three in terms of the price and performance. We have relied on our... human resources director to provide us with a significant amount of information. And over the past month, we've asked them to go back and review this... I have no idea of why we are considering going back to a provider that we've now heard does not have the proper certification for the service..."

What I think Councilmember Saylor fails to consider is the concern over the termination of a long term relationship with a local provider and the price that was bid by Cigna as well as whether or not PRA is certified to provide this service. In the original staff report and at the prior two city council meetings in which this issue was discussed no mention was made of the certification issue. In fact it was not an issue. Regarding costs, it appears, and we did the math on Tuesday, that Cigna would lose a small amount of money in their bid if the same number of people requested the same amount of service as they did last year. That was never explained by staff or the council, how the math added up.

Furthermore, it seems rather surprising to a number of people I talked to about this subject after the meeting, that the staff never asked the local provider who the city had a 23 year relationship with about their alleged lack of certification. To this layman who is not a staff member or on council, that would seem the next obvious step. It seems that the staff was very quick to end a long time relationship over what really amounts to a small amount of savings in the scope of the city yearly budget.

---Doug Paul Davis reporting

Commentary: Council to Decide on Change in Employee Assistance Program Provider

In December 2006, we had an extensive article on the proposed change in the Employee Assistance Program (EAP) provider from the locally owned PRA to the nationally based Cigna.

As is often the case, trying to pin the city down on these types of issues is tantamount to trying to hit a moving target. The original proposal was a Consent Agenda Item schedule for December 5, 2006. Upon being alerted that a councilmember intended to pull the item for discussion at the December 5 meeting, City Manager Bill Emlen announced that this item was being pulled by staff and would be brought back at the next meeting on December 12, 2006. At that point, the majority of members on the council had questions about the item and so it was postponed until this week. Each time the staff report has changed which reveals some new information about the plan.

It has now on this evening's agenda as a regular discussion item—which it really should have been in the first place. The consent agenda should be limited to items that truly are non-controversial.

The purported "significant fiscal savings" described by city staff appears to come at the cost of a great loss in service provided to the employees. There are currently 51 employees receiving this service from the City of Davis. Because these are people receiving counseling and psychological services, they are unlikely to come forward and complain about the change in their benefits plan. This appears to be yet another example of the city being able to cut benefits to a group that is likely to not attempt to fight back.

One key area of note in the new report is this:

“The proposed EAP contract allows employees up to six visits per incident per year; our current EAP contract allows employees eight visits per year, with no per issue cap. This has allowed employees to use the current EAP provider for long term psychological counseling. The City’s desire is to only offer short term counseling for employees to help them through a traumatic event that is causing problems at work, home or both. The City has no desire to pay for employees’ long term psychological counseling.”

How exactly a shift from eight visits per year to six visits per incident per year, constitutes a shift from long-term to short-term counseling is unclear. That seems a very arbitrary distinction. If an individual met once per week, you are talking the difference between six weeks and eight weeks. In either case, it does not seem to be long term counseling.

But that changes the calculations we performed in our previous article.

The city staff has proposed a shift from the locally based PRA to Cigna based primarily on the differences in their quotes. PRA is quoting $38,500 while Cigna is quoting $14,500--$24,000 less than PRA (and nearly a third of the cost of PRA's quote). That’s a tremendous difference percentage wise, which leads us to question how exactly Cigna derives that figure. (Again I refer you back to the original article, the numbers are slight different with the now known cut in number of visits).

If we do the math on this, we realize that the city saves a lot of money primarily through a cutback in services.

PRA pays its psychologists $70 per hour while Cigna pays $62 per hour. (This is for psychologists who have a master’s degree rather than a PhD).

Last year the EAP program helped 51 employees. At 8 visits, PRA provided employees with 408 hours of care whereas the new plan would allow only 306 hours.

If we do the math:

PRA: 408 x 70 = $28,560
Cigna: 306 x 60 = $18,972

Now if we compare the profit we notice even with these revisions that while PRA is turning about a $10,000 profit, Cigna would be about $4000 in the hole. Obviously that cannot be accurate since Cigna would not accept a bid where they lose money.

Apparently that is made up for by cutting back on the number of employees that the plan actually helps get treatment. According to PRA's figures, they serve between 9 and 13 percent of the cities employees. On the other hand, the average large company serves a much lower figure of 2 to 3 percent. That means that Cigna would actually cover on average three or four times fewer employees than PRA.

That represents a large cut in the scope of the service, not just a cut in the number of visits allowed.

As we suggest in great detail in the original article, Cigna makes their profit by creating a burdensome and intrusive referral process whereby a number of employees get weeded out just by making the process for getting treatment exceedingly difficult.

So while the city has spent tremendous amounts of resources on the employee benefit packages of some employees, they have been quietly cutting the benefits of others by changing providers. And of course they attempted to do this through a consent agenda item.

---Doug Paul Davis reporting

Commentary: Where is the local coverage by the Davis Enterprise?

As I closed down shop late last night, I remarked to friends about just how extraordinary this past week's Davis City Council Meeting had been. There were no less than five major stories during that meeting: proposed merger of the Senior and Social Services Commission; the city’s general plan update process; the failed police car camera system; the city’s EAP service contract; the city’s parks consulting contract; the duplicity & disingenuousness of both Don Saylor and Stephen Souza as well as Ruth Asmundson’s Surrogate moment. We covered them all; it took until late yesterday for the People's Vanguard of Davis to finish covering that City Council meeting.

The remarkable thing about it, is that the Davis Enterprise and their city reporter, Claire St. John, covered one single story from it--the discussion on the general plan update with a brief mention of the Senior Citizens Commission merger at the end. I looked at the paper this morning and one of the front-page stories is that John Edwards is going to run for President but not Even Bayh. It is two years before the Presidential election, one year before the first primary, and frankly neither of those guys are going to win. If I want to read about national politics, I'll go to the New York Times, the Washington Post or read the National Journal. But I read the Enterprise to get local coverage and they have failed to provide that with regards to this past meeting.

For example, not a lot of people will pay attention to that Employee Assistance Program (EAP) issue, but that is a major scam being perpetrated upon City Employees by Cigna and the "pennies wise, pound foolish" cost-cutting city staff. Read the article several times if you have to, there was a lot of work put into that article, but my reading of this situation is that the only way that Cigna will make money off that bid is if they cut service from 9% of employees down to 2 or 3 percent. And it's being sold as a way to save money while maintaining or even increasing service level.

I am left with but one conclusion--if you read the Davis Enterprise, you will get a very small and a very skewed picture of what is happening in Davis City government.

Of the five most crucial issues that came before the council, only two were covered. The Davis Enterprise did have substantial coverage of the Senior Citizens issue in the weeks leading up to the final vote on Tuesday. But even in this case, the reader would have missed a lot of important context.

Claire St. John of the Davis Enterprise writes:

A subcommittee of Mayor Pro Tem Ruth Asmundson and Councilman Stephen Souza recommended the merger and asked the two commissions to explore the idea, but the Senior Citizens Commission rejected the proposal immediately, collecting signatures and making strong statements against it. "It was an idea," Souza said. "I'm sorry if it was misunderstood."

What the article on Wednesday does not mention is that it was more than "an idea." On September 12, 2006 the merger appeared as a resolution in the agenda backed by a full recommendation for passage. And yet, the reader having no context for this issue would conclude that Souza and Asmundson had come up with an idea and then changed their mind.

The striking thing about this meeting is how blatantly duplicitous the major faction of the City Council was during this meeting. The very last item that they discussed sums it up--Councilmember Don Saylor misrepresented his motivations for voting to take no action on an RFP (request for proposal) item that would authorize the taking of bids for a park's consultant. Saylor voted with Heystek and Greenwald two weeks ago so that he could preserve his parliamentary option to bring up the item for reconsideration once Asmundson returned from her oversees trip. Souza then claimed this wasn't an acceptance of the consultant--which is true to an extent, but also misleading about the way this process works. And finally, the need for reconsideration came because Asmundson was absent during her travels. Greenwald had very generously put any item that Asmundson wanted to consider, off until Asmundson returned. Yet, this generosity and courtesy was not rewarded by the council majority on an item that Asmundson had not requested be postponed until her return.

Then there is the issue of the police cars. Here is a case where the city knew that there was a problem with the in-car digital recording equipment that cost the city over $140,000 to purchase and install. The city does not come forward with this information to inform the members of the city council, let alone the public. And to date, the Davis Enterprise has not covered it.

The biggest ally of the council majority is an uninformed electorate. Unfortunately, a lot of people who believe they are informed are not getting the full story or any story at all. That is one of the reasons why in late July I started this blog. And one of the reasons why I continue to put time and energy into researching the stories that I write about.

---Doug Paul Davis reporting

City Proposes a Cut in Counseling Benefits for City Employees

On the December 5, 2006 City Council agenda there was a consent item that would authorize "the adoption of Cigna Behavioral Health as the vendor for the City of Davis Employee Assistance Program (EAP)" on January 1, 2007. City staff supported this plan because it would realize as they state in their report "significant fiscal savings" in the amount of $24,000 per year.

This is a very complicated issue as it deals with a number of technical aspects. Keep in mind that this item was placed on the consent calendar agenda. The consent calendar agenda is the place where non-controversial items are placed together as a single-item to facilitate their passage without discussion.

Upon being alerted that a councilmember intended to pull the item for discussion at the December 5 meeting, City Manager Bill Emlen announced that this item was being pulled by staff and would be brought back the next week--ostensibly in order to prepare for a discussion. But again staff placed the item on the December 12 consent calendar agenda for approval without discussion. At the meeting Councilmember Lamar Heystek pulled the item for a full discussion by the city council. There was then a lengthy discussion and again it was decided by the council to hold the issue over for even more discussion until the city council meeting on January 16, 2007. This should call into question the placement of this item on the consent agenda.

As we actually look into this issue, the purported "significant fiscal savings" appears to come at the cost of a great loss in service provided to the employees. There are currently 51 employees receiving this service from the City of Davis. Because these are people receiving counseling and psychological services, they are unlikely to come forward and complain about the change in their benefits plan. This appears to be yet another example of the city being able to cut benefits to a group that is likely to not attempt to fight back.

The key issue here is that Cigna’s quoted price of approximately $14,500 per year premium requires them to severely cutback on the amount of people who use the service in order for them to make a profit. As we will see shortly, they do this by creating a tremendously complicated referral system that appears to be specifically designed to discourage people from filing for coverage.

Cigna quoted approximately $14,500 per year premium for their EAP. Psychological Resource Associates (PRA) the existing provider, on the other hand, quoted a higher premium at approximately $38,500 per year based on the prior year’s usage. The difference or "savings" is $24,000. City human resources staff said they wanted to change paying the provider from a per incident premium (determined by employee usage) to a set premium regardless of usage. They did this primarily because last year, the service ran well over budget. Instead of adjusting the budget to reflect realistic employee usage of this benefit, city human resources staff determined they wanted to hold costs down to a predetermined amount all the while marketing their efforts as providing equal service or even more service for less money with another vendor.

As reported by Dr. Dean Dickerson (PRA principal) in his letter to Sharon Neilson (city staff human resources analyst) he pays his psychologists with a master's degree $70 per hour and Cigna pays theirs $62 per hour. He pays his psychologists with a PhD. $90 and Cigna pays theirs $70. The bulk of counseling services provided is with psychologists with master's degrees.

Let us compare the two proposals: Last year the EAP program helped 51 employees. Using only the lower pay scale for psychologists with a master's degree for cost analysis, if those 51 employees saw a counselor for the 8 counseling sessions per person which the EAP plan allows that is 408 hours of service.

• PRA costs are then 408 times $70 = $28,540

• Cigna costs are then 408 times $62 = $25,296

Since no company including Cigna is in the business of losing money how can they afford to make a bid of $14,500 for EAP services all the while saying they are providing even more services to the city's employees in their proposal than PRA is currently providing? Dr. Dickerson reports that historically between 9 and 13 percent of the city's employees have used the EAP program provided by PRA verses the national average of big insurance companies’ usage which is much lower--between 2 and 3 percent. Thus you can clearly see that national insurance companies structure their programs in a way that reduces the usage of the service offered. They make it more difficult to access the service and they reduce the quality of the service provided.

So those are the numbers, but how does Cigna get to those drastically lower numbers of service?

Cigna offers lower-quality services from a corporate headquarters that is staffed by less-qualified employees (think about the service you get when you call an "800" number for assistance). Employees seeking service will have to talk to out-of-state (out-of-country?) strangers at the other end of an "800" number in order to have their most private of needs dealt with.

PRA has provided the City of Davis with EAP services since 1984, and it is also the EAP provider for Yolo County employees, Davis Joint Unified School District employees, Yolo Office of Education employees, and Yolo-Solano Air Quality Management District employees.

Cigna on the other hand, lacks the specialization and quality of service that PRA has in providing EAP services. Cigna does not provide the personal service that employees have come to rely on, rather their program is more of a tool to assist management and human resource personnel in dealing with issues such as employer-employee relationships, emergency crisis management, work related issues and other short-term types of services that EAP covers. (From the staff report: “Employee Assistance Programs, by design, offer short term counseling and guidance and are not intended as a replacement for more intensive counseling needs, which are covered by other long term health care options available to employees.”)

Moreover, while PRA offers services from 11 therapists in Davis and Woodland and over 50 overall in the Sacramento area, Cigna only has 5 therapists in Davis and the Woodland area. PRA requires all of its therapists to prioritize EAP requests thereby guaranteeing immediate assistance 24/7, 365 days of the year. By calling PRA they assist the employee in finding a therapist immediately. That is PRA's responsibility, not the employee's. But with Cigna that burden falls on the employee. Cigna only offers referral direction to lists of providers but does not guarantee that their providers will take the referral. It is up to the individual Cigna therapist to determine whether they have the time to see the employee leaving the employee in the position to call one provider after another from a much more restricted list. In other words, we are talking about a Cigna EAP system in which the employee who is in crisis is faced with a cumbersome task of trying to access help. With Cigna, there will be fewer therapists (who already have their own clientele) being asked to provide additional services for on the average 50 plus employees per year.

Cigna's referral process seems overly intrusive to the employee and burdensome on both the employee and employer.

The following directions to the employer or supervisor is from Cigna's management training website:

You may call at any point regarding a difficult or troubled employee or team, and speak to one of our employee assistance consultants. They will ask key questions, advise you how to proceed, and even role play situations with you when warranted. Consultation may result in a recommendation of a formal referral to the EAP, a training seminar delivered by the EAP, or any number of other options.

Furthermore these are the Cigna procedures for a formal referral for the employer or supervisor:

• First, consult your HR Dept. about your company's policies
• Call EAP before meeting with the employee, and give us employee's name and details
• We will fax you a Release of Information form for employee to sign
• Have a meeting with the employee to discuss the issues
• Give employee the EAP number and have them call for appointment
• After assessment is complete we will inform you of recommendations and employee's compliance

There are a number of very troubling aspects of this endeavor, beginning with the procedural matter of attempting to push this item through as a consent item without discussion. Fortunately, once again, Councilmember Heystek was vigilant on the issue of employee benefits and had the item pulled for discussion last week. Mayor Sue Greenwald then suggested as a courtesy to Mayor Pro Tem Ruth Asmundson (who had been out of the country for several weeks) that the item be held over until the next city council meeting on January 16, 2007 so she could study the matter.

Second, the city is gaining a questionable “saving” of $24,000 per year as that “savings” apparently comes at considerable cost in the form of less service to the employees. The city manager and his human resources staff are recommending that the city end working with a local provider that has served city employees for 22 years. They are removing the city from a provider that works with other municipalities and government agencies in this area. And they are giving a contract to a large and faceless national corporation that undervalues Employee Assistance Programs and makes it difficult to access them. Those facts alone should necessitate a strong and compelling reason to take such an item off of the consent calendar to have it discussed. Again, a questionable “savings” of $24,000 and city staff’s assertion that they are increasing benefits does not seem a sufficient explanation for such a move, when it is, in fact, a reduction in benefits.

Once again, the City of Davis seems “penny-wise but pound-foolish.” Let us ask ourselves if there is an express need to make this change other than a marginal savings of money. Do the employees feel that they are not getting good services with this current provider? City staff acknowledges that PRA provides excellent service and there have been no complaints. If not, $24,000 does not seem to be sufficient "savings" to reduce the benefits to hardworking city employees.

---Doug Paul Davis reporting