Don Mathre
- MSU-Bozeman
Maggie Peterson - MT Tech-UM
Susie Wortman - WDCL-MSLA
Susan Briggs - WMC-UM
Susan Alt- MSU-Bozeman
Sue Hill - OCHE
Vicky Whitney - MSU-Bozeman
Michael Brown - UM-Missoula
Terri Gruba - UM-Missoula
Michael Franisconi - WMC-UM
Chuck Jensen - Helena COT-UM
Jim Handley - MT Tech-UM
Don Herzog - IBEW
Tom Schneider - MPEA
Kathy Haggart - MSU COT-Great Falls
Kathy Crego - UM-Missoula
Ken Emerson - MSU-Bozeman retiree
Kevin Turner - AFSCME
Terry Leishman - IUOE #400
COMMITTEE
MEMBERS ABSENT:
Lars
Ericson - Carpenters
Vicki
Miller - MSU COT-Billings
Margaret
Meggs - MSU-Northern
Norma
Tatarka - MSU-Bozeman retiree
OTHERS
PRESENT:
Glen Leavitt - OCHE Nancy Fitch - UM-Missoula
Jerry Coffey - MSU-Bozeman Julie Taylor - APS Healthcare
Kerri Marx - MSU-Bozeman Richard Miltenburger - Blue Cross/Blue
Shield
Kirk Keller - MSU-Bozeman Rita Garland - UM-Missoula
Mary Kay Puckett - Blue Cross/Blue Shield Ken Hapner - MSU-Bozeman
retiree
Joan Fabricius - Blue Cross/Blue Shield
Allison Justman - UTU-Missoula
Kris Jones - Buck Consultants
Rita Garland - UM-Missoula
Diana Schramm - OCHE
Linda Ryckman - OCHE
Dawn Watkins - MSU-Bozeman
JoAnn Chambers - SAF
Quint Nyman - MPEA
Sharon Caven - MSU-Northern
Jerry Hayes - New West
Meg Lewis - New West
Ellen Feaver - Employee Benefit Resources
Dirk Camilletti - TIAA/CREF
Teresa Buffington - MSU-Bozeman
Todd Lovshin - MEA-MFT
Minutes of February 7, 2001
Chairman Mike Brown called the meeting to order at 10:15a.m.
1. Call to Order
2. Introductions
3. Director's Report - Glen Leavitt
Glen Leavitt
reported on the progress of the RFP for administrative services.
Blue Cross/Blue Shield now performs these services for MUS.
The final RFP proposals are due back on March 13, after which
the evaluation process must be done.
The Wellness Directors will continue working on a standard reporting
format for the fall IUBC meeting. The Wellness Directors will
also be reporting on an employee Wellness survey that will be
done on all the campuses.
Glen reported on several legislative bills effecting MUS. These
include:
HB 116 which
fine tunes the defined contribution plan. MUS staff will have
the choice of staying in PERS, the defined benefit plan; or
joining the defined contribution plan that will be run by PERS;
or joining the ORP.
HB 294 is the GABA (guaranteed annual benefit adjustment) bill
for the retirement plans. It provides for a 3% GABA increase
for PERS retirees, and may eventually include TRS retirees.
LC 455 funds the ORP by making a direct appropriation to TRS.
This would change the 4.04% rate paid by ORP participants that
goes toward the unfunded liability of TRS. LC 455 would eliminate
that and fund the liability directly which would then allow
the contribution to the ORP to increase.
HB 63 taxes a disability benefit on the defined contribution
plan, this does not apply to the ORP.
SB 51 is a VEBA bill which allows employees to put a portion
of their unused sick leave, paid out at 25%, into a spending
account for future medical costs primarily aimed at retirement.
Glen also
reported on the status of the State pay plan that includes an
increase in the state contribution of $30.00 the first year
and $41.00 the second year of the biennium.
According to Glen's financial report projection, the plan will
be down about $266,000 at the end of this plan year. With no
increase in contribution from employees or retirees, or changes
in the plan in 2002/3, the deficit will be about two million
dollars.
4. Consultant's Report - Kris Jones
Kris said prescription drug expense on a per employee basis is up 26.5%. This is in the active employee group and over the same six months from a year ago July through December. The average cost for the active self-funded group was up about 3.0%. For retirees under age 65 the total expense was up 24%. For retirees over age 65, the total expense was down 1.9%. Combined actives and retirees in the self-funded program are spending $285.00 for every $315.00 taken in. But this trend is not expected to continue for the rest of this plan year. In the CHO plan MUS is paying out about 95% less in premiums than what is received in funding. According to Buck Consultants with both the self-funded and the CHO plans added together the deficit will be about $900,000 at the end of this plan year. This figure does not reflect any interest or plan reserves.
5. New West Health Plan - Jerry Hays
New West calculates premium costs on a per member per month basis rather than per employee. With only six months of claims data recorded so far it's hard to establish any trend lines or project how the plan year will end. The total claims paid for the first six months were $279,976.00. New West is working on a ppo (preferred provider organization) in the Bozeman area. Jerry also announced New West's recent partnership with the Beech Street Corporation. This alliance will give members in-network benefits from Beech Street participating providers nationwide.
6. TIAA/CREF - Dirk Camilletti
Dirk Camilletti presented the November 2000 Annual Business Review for the Montana System of Higher Education. This review summarizes plan participation, accumulation, contribution, and asset allocation data, together with TIAA/CREF benchmark comparisons. Dirk stressed the importance of long-term retirement investment, especially using diversification among multiple asset classes. This means having your investments spread among at least three asset classes with one asset class being stock.
Lunch
7. Plan Change Subcommittee Recommendations
Glen explained
that most prescription drug plans are now using a tier pricing
system with a formulary. Using this system a plan member would
pay more for a multi-source brand name drug than a generic drug.
The multi-source/non preferred brand would be more expensive
than the single source brand/preferred brand. Plan members who
want the more expensive drugs would pay more for them unless
no other drug is available. The out-of-pocket maximum would
be increased to $600 a year. MUS pharmacy rates are rising at
an overall rate of 18%. The per- member cost increase for the
last six months is 26%.
The subcommittee's recommendation was for option two of the
two options proposed, and to raise the out-of-pocket to $600.
The co-pays on option two would increase to $15.00, $25.00 and
$8.00 at the network and $30.00, $50.00 and $15.00 at the mail
order. This option saves the plan $909,000 and costs plan members
$545,000.
Buck Consultants looked at increasing the deductibles of $350
and $500 by $50, $100 or $150. The revenue these numbers produced
was fairly small and not worth the trouble. The sliding deductible
or salary based plan designs are not being recommended because
the plan members affected could just select the cheaper HMO
option. In addition to the $900,00 needed, dependent costs would
increase $15.00 per month and retiree rates would increase to
$30.00 in the first year of the biennium and $41.00 in the second
year. This increase in retiree rates reflects the increase in
the State contribution.
The subcommittee recommended to not review the issue of Viagra.
The subcommittee recommended continuing work on developing the
CHO option in Bozeman.
The subcommittee rejected the Declaration of Domestic Partnership
for opposite sex couples.
The subcommittee recommended finding some language that allows
adding naturopathic medicine to the plan in conjunction with
chiropractic and acupuncture treatments. The fifteen visits
now allowed could be spread among all three of these services.
The subcommittee recommended not adding either the Prepaid Legal
or AFLAC supplemental insurance at this time. In the future
vendors such as these will be referred to a subcommittee. A
policy has been developed to handle the issue of vendor presentation
in the future.
If the IUBC accepts the plan change subcommittee recommendations
of the increases in the prescription drug costs, and increases
the dependent premium by $15.00 a month and increases the retiree
premiums by $30.00, the plan should be close to being solvent.
Committee
Action
Motion: The seconded motion from the subcommittee's recommended
options was to use option 2 in the drug changes with the increase
in the out-of-pocket and some slight changes in co-pays; look
at premium increases of $15 to $20 per employee per month on
the dependent coverage on average, with the intent of choosing
whichever one brings the plan closest to breaking even.
ACTION: The motion carried.
8. VSP - Steve Hanks, Tim Altman
One of the complaints with the vision plan is that new frames and new lenses need to be purchased in order to receive the 20% discount. Evidently not all employees understood this when the plan started. The contract VSP has with it's providers is for a 20% discount when a complete pair of lenses and frames is purchased together. This is under product review for next year. Employees with questions on the new lasik eye surgery should talk to one of the VSP participating doctors.
9. Committee Action - Motions
The motion was made and seconded by the subcommittee to reject adding the PrePaid Legal or AFLAC insurance at this time.
ACTION: The motion carried; there was one quack.
The motion was made and seconded by the subcommittee to not
reopen the Viagra issue and the treatment of sexual dysfunction
will remain excluded under MUS policy.
ACTION: The motion carried, one no.
The motion was made and seconded by the subcommittee to continue exploring the CHO options for the Bozeman area, but it is not limited to just Bozeman, this includes all areas.
ACTION: The motion carried; none opposed.
The motion was made and seconded by the subcommittee to reject
the change for domestic partners of opposite sex and stay with
the existing policy.
ACTION: The motion carried, one no.
The policy for vendor presentations as developed by Sue Hill was presented to the committee.
Motion: The motion was made and seconded to accept the draft
policy for vendor presentations as presented.
ACTION: The motion carried, none opposed.
10. New Business
The labor appointees to the committee will appoint a new labor representative to the committee before the next IUBC meeting.
The next IUBC meeting will be held March 8, 2001 in the Regent's Conference Room, Office of the Commissioner of Higher Education, Helena.
The meeting was adjourned.