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Commissioner Bird wished to know just what Health Maintenance Organization (H.M.O.) is, and Commissioner Wodtke advised that it is a special type of plan which offers you an entire health care package, but only at a specified hospital. This is a growing trend in hospital care, and some private hospitals such as Humana, which has a plan called P.P.O. (Preferred Provider Organization), are getting into it quite heavily. Indian River Memorial is looking at various proposals of this type. Vice Chairman Lyons noted that this plan not only covers the hospital stay; it is total medical care. Commissioner Bird commented that he has no problem with the.. Gulf Health Insurance coverage, but wondered how often we go out to open bidding. OMB Director Baird noted that presently we have a self- insurance plan; it is an annual contract we are entering into, and he would prefer to stay with them because the insurance plan is doing well and we have adequate reserves. Commissioner Wodtke wished to know if Gulf will extend for another year at the present rates. Nick Morisco, Regional Group Manager of Gulf Group Services Corporation, noted that their terms for renewal for the coming 1986-87 policy year a're set out in his letter to Mr. Baird, and essentially there is no change in their rate structure for the coming year because there are adequate reserves; actually, there has been about a 1% decrease from last year. Vice Chairman Lyons believed we simply pay them for the administration of our money, and this was confirmed by Mr. Morisco. The Vice Chairman had a question on the coverage involving retired people on Social Security and Medicare. Mr. Morisco explained that how Gulf coordinates with Medicare is at the direction of the policyholder. Commissioner Lyons wished to know if a retired person, for instance, goes to the hospital and Medicare comes up with 25 BOOK 64 Ft10E 802 ,SUN 25 1986 I