Valley Health-Anthem consequences; FRPD bank loan details scrutinized

After getting an opening salvo from long-time critic Paul Gabbert aimed Interim Town Manager Matt Tederick’s way, the Front Royal Town Council, minus member Letasha Thompson, moved through a series of meeting and work session budget and ordinance updates and related staff suggestions, as well as consideration of a reduction of the number of Town Planning Commission members from seven to five, and discussion of employee health insurance coverage options if the compensation impasse between Valley Health and Anthem (Blue Cross/Blue Shield) is not resolved. In an added meeting agenda item council approved a Resolution approving recently submitted language required by United Bank regarding the $8.4-million loan to facilitate the Town’s assumption of the debt service on the Front Royal Police headquarters from the EDA.

Council conducted a variety of business over the course of a meeting and work session totaling just one hour Monday evening. Royal Examiner Photos by Roger Bianchini – Royal Examiner Video by Mark Williams

It was noted in a summary prepared by insurance consultant Gallagher presented during that latter health care coverage work session discussion that Valley Health had hired a California-based consultant in its dispute with Anthem over its compensation from the giant health insurance provider and that Valley Health, “wants reimbursement levels that makes Valley Health highest-paid or close to highest-paid provider in the state of Virginia.”

And in its attempt to acquire that compensation from Anthem, Valley Health has “sent a preemptive letter of termination to Anthem for December 31st” that would make Valley Health a non-participant in Anthem health care coverage on January 1, 2021.

Under consideration by council Monday was sending “TLC” (The Local Choice), which is the Town’s current State Department of Human Resources Management medical insurance provider through Anthem, a notice of termination effective December 31. This would leave Town employees, like others including the County Public School system, out of coverage and facing higher health care costs likely through the end of the fiscal year.

While the State requires 90 days notice of opting out of TLC, making a November 1 notice effective February 1, the option of holding off on the TLC termination notice in the hope the corporate high-stakes poker game between Valley Health and Anthem will be resolved by the end of the year was also presented.

Interim Town Manager Tederick explains options moving forward through the Valley Health-Anthem Insurance financial impasse on a new contract.

But council authorized the interim town manager to move forward with the TLC termination letter by November 1. If a settlement is reached between the dueling medical and insurance providers, the termination will be rescinded, Tederick later explained to us.

The interim town manager told council that a similar medical care provider and Anthem dispute had been settled shortly after the turn of the unnamed year it occurred. Tederick later said he believed information we had received from another source that the referenced medical care provider that had carried its past dispute with Anthem past a previous December 31st deadline was represented by the same California consultant Valley Health has contracted in its current dispute with Anthem, was correct.

Tederick also told council that several impacted Northern Shenandoah Valley municipalities could spearhead the formation of a group pool of employers with as many as 3500 employees to seek a lower pool rate coverage from providers in the next fiscal year beginning July 1, 2021.

Details being ironed out on FRPD loan

In the meeting’s final agenda item added by Vice-Mayor Bill Sealock at the meeting’s outset, council approved a resolution authorizing what was described as “required wording” by United Bank regarding the $8.4-million loan at a very favorable 1.87% interest rate to assume the debt service on the Town Police headquarters.

Can we please get this loan/debt service situation resolved so we can stop pulling out these FRPD headquarters file photos?

The new wording was received by Town staff earlier in the day, not giving the legal or finance department time to review the resubmitted document in its entirety. On Sealock’s motion, council approved the resolution authorizing acceptance of the new loan wording contingent on its review and approval by staff. It was noted that a deadline of noon, Wednesday, October 28, was pending on final approval of the loan terms.

Contacted Tuesday, Finance Director B. J. Wilson said were there to be any question about the wording leading to a missed Wednesday loan finalization deadline, it would likely only mean that a loan agreement would be reached in November instead of October, impacting the terms only as to a slight increase in the accrued interest the Town would be paying.

A misdirected opening salvo

Gabbert’s above-referenced meeting opening salvo, including a call for Tederick’s immediate termination for “gross deception”, appeared based on a misunderstanding of a published legal notice reference to a “Front Royal Industrial Development Authority” as opposed to an accompanying reference Gabbert cited to a “Warren County Economic Development Authority”.

Gabbert seemed to believe it was a unilateral effort by the interim town manager to implement a second Town EDA that has been on the table, if not finally approved as a done deal as the Town and EDA appear working toward resolution of some past impasses, particularly the FRPD headquarters financing which Tederick has predicted could lead to a settlement of the Town civil suit against the EDA “within 45 days”.

What did I do this time? Interim Town Manager Matt Tederick may be wondering as he is lambasted at meeting’s opening by public speaker Paul Gabbert.

However, as this reporter explained to Gabbert as he passed the press table following his remarks, you sometimes still see, particularly in legal filings and even on the EDA website under “About EDA”, the EDA referred to by its original “Industrial Development Authority” name more prevalent in the 1960s-‘70’s-‘80’s’s, often followed by the notation “trading as the “EDA” or “Economic Development Authority”.

Contacted later Tederick verified this reporter’s perception of the referenced ad language and noted that the published legal notice had been prepared by Town legal staff, not him.

The referenced “Daily” legal notice of a public hearing wording in question is: “The Front Royal Town Council will hold a public hearing on Monday, November 9, 2020, at 7 p.m. in the Warren County Government Center located at 220 N. Commerce Avenue, to consider a rezoning application submitted by the Industrial Development Authority of the Town of Front Royal and the County of Warren, also referred to as the Economic Development Authority, for the rezoning of approximately 62.7 acres of property …”

Monday night when Tederick commented he would seek to assemble information to “see that Mr. Gabbert gets his facts straight” Gabbert angrily rose from his seat in the audience under the watchful eye of FRPD Chief Kahle Magalis in an attempt to call a “point of order” for Tederick referencing him personally in his remarks, though if I am not mistaken, only meeting members may call points of order by the governing Roberts Rules of Order.

Above, Gabbert takes exception to Tederick’s comment his facts weren’t accurate; and takes his seat after a suggested ‘Point of Order’ chastising of the interim town manager for referencing him by name following his comments.

However, having made his point Gabbert sat back down without incident, other than Mayor Tewalt stating he wanted to see no further public outbursts perhaps violating the recently implemented “Rules of Decorum” included now as page two of agenda packets.

See these discussions and other business conducted in this Royal Examiner meeting and work session videos: