Insurance Committee 05/30/2013

INSURANCE COMMITTEE

DRAFT

Minutes of Special Meeting

Board of Education Conference Room

May 30, 2013

The meeting began at 7:35 a.m. Present were Ed Sparkowski, chairman, and committee members Nick Mason, Peter “Chris” Peterson and Paul Mikkelson, Jr.

Burke LaClair, the Board of Education Business Manager, and Tom Cooke, the Director of Administrative Services were also present. Robert Lindberg, of Lindberg and Ripple and Carol Fitzsimons of CIRMA were in attendance as well.

Mr. Mason made a motion to approve the March 2013 draft minutes. It was seconded by
Mr. Mikkelson, Jr. The minutes were unanimously approved.

The purpose of this special meeting was to seek the Insurance Committee’s input on stop-loss insurance coverage levels as discussed at the March meeting. This special meeting will replace the next regular Insurance Committee meeting that was scheduled for June.

1. Employee Benefits Update - Robert Lindberg

Mr. Lindberg distributed an 11-page Insurance Advisory Committee Report.

Page 1:  Meeting Outline. Page 2:  Experience Update Outline. Page 3:  Combined ASO Medical / Pharmacy Paid Claims for Simsbury town and BOE employees from July 2009 through July 2013.
Page 4:  Dental ASO Paid Claims for Simsbury town and BOE employees from July 2009
through July 2013. Page 5: Medical and Dental Enrollment Number Summary for the town and the BOE from July 2011 to July 2013. Pages 6, 7; 8:  A letter from Mr. Lindberg to Mr. Cooke, Ms. Harris and Mr. LaClair regarding Alternate Stop-Loss Levels for 2013-2014, broken down by individual stop-loss and aggregate stop-loss. Page 9:  Symetra Stop-Loss Premium History Chart for a Combined CIGNA and Connecticare Package from July 2010 to July 2013. Page 10:  Symetra Stop Loss Premium History Chart for CIGNA-Only Package and Connecticare-Only Package from July 2010 to July 2012. The final 3 columns on this chart offer stop-loss alternatives at different coverage levels: $225,000, $250,000 and $300,000. Page 11: Simsbury Town and Board of Education ASO Financial Summary July 1, 2013. A snapshot of the overall fixed and variable cost components. In the report, Simsbury’s current carrier package was compared to a renewal package with the same carrier, as well as new packages with the following carriers: CIGNA-only, Connecticare-only, Aetna or Anthem.

Recent Claim Activity. Mr. Lindberg reported that the 10-month period of claims activity (July 2012 through April 2013) continues to be favorable. The claim pattern is running better than expected. There were no large claim events in this recent cycle. Market trend is still hovering around 10% for medical. Mr. Lindberg expects that this trend may be flat for another cycle, but will eventually go up. There will are currently no significant coverage changes in the market. He expects the year to finish strongly.

Stop Loss Review and Decision. A long discussion ensued about ASL and ISL reinsurance programs for 2013-14. The committee examined the need vs. expense of aggregate stop-loss insurance for a fiscally conservative town with a good reserve. The committee ultimately agreed to recommend the following: 1. Discontinue the town’s ASL insurance, and 2. Alter the ISL insurance limit to $250,000. Mr. Lindberg will provide the Town with new written recommendations based on today’s discussion.

Market Study Update. Mr. Lindberg has completed interviews with Connecticare and CIGNA to address underlying concerns.

New Wellness Program. Mr. Cooke and Mr. Lindberg told the committee about the new wellness program for town employees. It is being run by IHS. IHS has a very knowledgeable staff. They are running a full biometric screen, and offering $100 for members who also opt to have their blood drawn. In addition, members will have a chance to have their premiums lowered if they maintain healthy parameters set by IHS.

2. Property Casualty Insurance Issues - Carol Fitzsimons of CIRMA

On behalf of CIRMA, Ms. Fitzsimons offered a 1-page discussion outline for this meeting. She also presented a 4-page report with colored bar graphs that further analyzed worker’s compensation and LAP losses for the Town of Simsbury and the BOE from FY 2007/8 through FY 2012/13.

Loss Experiences. Ms. Fitzsimons gave an update on loss experiences as of April 30, 2013 and compared it to the loss experiences from May 31, 2012 for a 3-year and a 5-year time span. Workers compensation claims continue to increase. Significant loss changes since the last meeting in March include, for WC: 1 town claim from 2012 increasing from $50,000 to $92,500 and 1 new BOE loss over $25,000. For L-A-P: An increase in the 2009 General Liability reserve from $66,000 to $150,000. This is not accounted for in the April 30, 2013 numbers.

2013-2014 Renewals. Ms. Fitzsimons will not have an accurate count of the number of renewals until June.

Risk management. Ms. Fitzsimons participated in a Health and Safety Fair on April 23, 2013.

Marketplace. Not a lot of changes. Same big players: Travelers and Trident. Restrictions are being tightened, and some members are unable to renew. They are coming to CIRMA as a result.

CIRMA update. Simbury’s cut of CIRMA’s member equity distribution will be $28,936 this year.  Distributions will be given in mid-July after policy renewals.
 

3. Other Insurance Matters. None.

Mr. Peterson made a motion to adjourn the meeting. Mr. Sparkowski seconded the motion. The meeting was adjourned at 9:00 a.m.

The next Insurance Committee Meeting will be held on Wednesday, September 25, 2013 at 7:30 a.m. in the Board of Education Conference Room.

Respectfully submitted,

Lorrie McElligott,
Commission Clerk