Explanation
BACKGROUND:
Funding for the short-term disability insurance program is necessary to ensure continuation of the program in accordance with the negotiated labor contracts. The Department of Human Resources requests to contract with The Hartford Life and Accident Insurance Company, through an extension, and to provide funding from February 1, 2026 through December 31, 2026 for this program. The contract originated February 1, 2021 and the contract term was for 3 years, with two (2) one (1) year renewals.
The effective date for the contract extension is February 1, 2026.
In 2025, the Department of Human Resources began to research procuring a system to assist with leave administration for the City. During this process, and in collaboration with our consultant, Marsh & McLellan Agency, it was discovered that leave administration and short-term disability products could potentially be bid together. The leave administration system would need to be integrated with Dayforce and possibly short-term disability. Dayforce, the Auditor’s Office, Department of Technology and the Department of Human Resources availability will need to be reviewed, and a project plan developed. Due to timing of this initiative, the Hartford contract will need to be extended through December 31, 2026
The total obligation of this contract in year two is $4,200,000.00. The breakdown of expense is $200,000.00 for administrative fees and $4,000,000.00 for claims.
Cost estimates for 2026 are based on 2023-2025 benefits fund expenditures using an average of actual city utilization, expected changes due to union negotiations, as well as input from the city's employee benefits consultant.
Emergency action is requested to ensure the short-term disability insurance program for city employees is able to commence as soon as contractually possible, thereby maintaining continuity of service.
FISCAL IMPACT: Funding is available in the 2026 Employee Benefits Fund for this contract. This ...
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