Special Notice / Hearing: None__
Vote Required: Majority
To: Honorable Board of Supervisors
From: Michelle Kuka, Human Resources Director
Ann Parada, Benefits Division Manager
Subject: Dental Plan Agreement with Cigna Dental
RECOMMENDATION:
title
Adopt a resolution authorizing the Human Resources Director or the Director’s designee to execute agreements with Cigna Health and Life Insurance Company to provide dental plan administration services for County employees, retirees, and eligible dependents for the period of January 1, 2027 through December 31, 2031, with the aggregate amount not to exceed $58,680,000.
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BACKGROUND:
The County provides comprehensive dental benefits to eligible employees, retirees, and their eligible dependents through a combination of Dental Preferred Provider Organization (DPPO) and Dental Health Maintenance Organization (DHMO) plans.
The number of enrollees includes active employees and retirees, and totals 6,512.
|
|
DPPO |
DHMO |
TOTAL |
|
Active Employees |
3,877 |
1,300 |
5,177 |
|
Retirees |
1,214 |
121 |
1,335 |
|
TOTAL |
5,091 |
1,421 |
6,512 |
The County has provided DPPO dental plan benefits through Cigna since 2017, and DHMO dental plan benefits through Cigna since 2021. The current dental agreement for all dental benefits with Cigna expires on December 31, 2026.
In anticipation of the contract expiration, the Human Resources Department conducted a competitive Request for Proposals (RFP) for dental plan benefits, in partnership with the labor-management Benefits Committee and the County's employee benefits consultant, Alliant Insurance Services. The RFP was designed to evaluate the marketplace and ensure the County continues to provide high-quality, cost-effective dental benefits while minimizing disruption to participants.
The Dental RFP was released on March 2, 2026, and proposals were due on March 31, 2026. The evaluation committee included representatives from County management, organized labor, the Courts, and Employee Benefits. The committee reviewed proposals and agreed on a selection recommendation to continue with Cigna on April 28, 2026. That recommendation was endorsed by the full labor-management Benefits Committee on July 23, 2026.
DISCUSSION:
The County invited proposals from numerous national dental carriers. Proposals were received from Cigna (incumbent) and MetLife. The evaluation committee reviewed each proposal using the criteria established in the RFP, including ability to match the County's existing benefit designs, provider network adequacy, financial competitiveness, administrative capabilities, customer service, implementation approach, and overall value to the County and plan participants
Following its evaluation, the evaluation committee unanimously recommended that the County continue its partnership with Cigna. The labor-management Benefits Committee reviewed the RFP results and evaluation on July 23, 2026, and supported the recommendation unanimously.
The primary reasons for the recommendation include the following:
• No increase in PPO funding. Cigna proposed maintaining the current Administrative Services Only (ASO) PPO funding level for 2027, while MetLife proposed approximately a 2% increase.
• Superior DHMO benefits. Cigna's DHMO proposal closely matches the County's current benefit structure with no member co-payments for many commonly used services. By comparison, MetLife's proposal would have introduced new participant cost sharing for numerous services, including periodontal treatment, prosthodontics, crowns, oral surgery, implants, and orthodontics.
• Minimal disruption to participants. Cigna's provider network offers substantially less provider disruption than the competing proposal, allowing more employees, retirees, and dependents to continue receiving care from their current dentists. This minimizes inconvenience and promotes continuity of care.
• Continuity of administration. Retaining the incumbent administrator avoids a complex implementation process, eliminates participant disruption associated with changing carriers, and reduces administrative risk during the transition to the 2027 plan year.
• Overall best value. After considering plan design, provider access, participant impact, administrative capabilities, and financial value, the evaluation committee concluded that Cigna provides the best overall solution for the County.
This resolution authorizes the Human Resources Director to execute the renewal agreement. As an incumbent client, the County’s renewal agreement is being drafted based on the existing contract and will take effect on January 1, 2027. We are requesting Board approval now for delegated authority to enter into the renewal agreement because County staff must begin work with Cigna now to prepare materials for the October Open Enrollment.
This resolution contains the County's standard provision allowing amendments that do not materially or substantially increase the County's obligations and authorizes fiscal amendments up to $25,000 in aggregate.
The County Attorney’s Office has reviewed and approved the resolution as to form.
PERFORMANCE MEASURES:
|
MEASURE |
FY 2025-26 Actual |
FY 2026-27 Projected |
|
DPPO-Network Providers in San Mateo County / Percentage Match to Dentists Used by County Participants |
67.1% |
67.1% |
|
DPPO-Plan Administration Cost Per Employee Per Month |
$1.60 |
$1.60 |
|
DHMO-Number of Network Dentists in San Mateo County Accepting New Patients |
96.8% |
96.8% |
FISCAL IMPACT:
The estimated 2027 cost of the agreement is $10,670,000, consisting of PPO administrative services of $130,000, DHMO premiums of $690,000, and projected claims of $9,850,000. The total contract amount over the five-year agreement term will not exceed $58,680,000, which includes a 5% contingency for workforce and retiree population growth and higher-than-anticipated claims. Funding is included in the Human Resources Department's FY 2026-27 Adopted Budget and will be incorporated into future recommended budgets.