INSURANCE COMMITTEE MINUTES 11/26/2014
TOWN OF SIMSBURY INSURANCE COMMITTEE
Subject to Vote of Approval - Regular Meeting Minutes
November 26, 2014
2 pages
The meeting was opened at 7:36 a.m. in the Board of Education conference room by committee member, Nick Mason. Other committee members who were present included Paul Mikkelson, Jr., Peter “Chris” Peterson, and Kateryna Lagun. Burke LaClair, the Board of Education Business Manager; Joseph Mancini, Finance Director; Robert Lindberg, of Arthur J. Gallagher & Co., and Carol Fitzsimons of CIRMA were also in attendance.
Mr. Mikkelson made a motion to approve the minutes from the Insurance Committee meetings on March 26, 2014 and September 24, 2014. Mr. Peterson seconded the motion. All were in favor. Both minutes were unanimously approved without changes.
1. Employee Benefits Update - Robert Lindberg
Mr. Lindberg distributed a 4-page report titled, “Simsbury Town and Board, Insurance Advisory Committee, November 26, 2014.” Page 1 to 2: Meeting Outline. Page 3: Combined ASO Medical / Pharmacy Paid Claims from July 2011 through July 2015. Page 6: Dental ASO Paid Claims from July 2011 through July 2015.
ASO Medical Consolidation. Mr. Lindberg mentioned that fixed cost improvements are running on a 2-year rate with guaranteed ASO fees. The high deductible health plan migration has been well accepted. Four months in, 20% of employees have elected to participate. Run out claims are still being paid, although they seem to be coming to an end. CIGNA is now offering a common platform for all town plan design programs, and is working to create a consistent message across all.
Running Claims Activity. As the town heads into 2015, its medical claims are down a bit, while its pharmacy claims are going up. Mr. Lindberg gave several possible reasons. In general, the population is aging, overweight and inactive, and care is being given through more frequent medical visits, rather than prolonged inpatient stays. Mr. Lindberg noted that Arthur J. Gallagher & Co. is actively monitoring developing claim patterns, and carefully tracking the open policy year with target costs, and year-over- year costs with trend.
Market Trends. Mr. Lindberg reported that the annual medical trend, which varies with vendor plans and elections, is running about 10%. He also noted that prescription market costs have been mixed. He cited several significant changes in the pharmacy landscape: 1. Some medications, which had been routinely injected at a facility, can now be picked up at a pharmacy and taken orally; 2. Several medication patents will be expiring soon, allowing many name brand medications to become available in generic form, and 3. Other clients are starting to require pre-authorization for certain classes of medication.. These include specialty categories (like meds for MS), not maintenance medication.
Activity for 2015. Employers are being advised to treat dental programs as optional coverage. After a market study review, the new Medicare Advantage Program, which is organized by county, will be removed from self-funded plans. As a counterpoint to federal and state exchange programs, insurance companies and association-based insurance businesses are offering defined contribution plans in which consumers are offered a dollar value to spend on health insurance. This private exchange option gives employers an alternative, a known cost, and the ability to pick a framework of multiple plan designs for employees. They are gaining traction slowly, and will have to be collectively bargained. The Connecticut State Partnership Plan will be available to municipalities in FY2015/2016.
ACA Update. Mr. Lindberg credited Eric Gomes, human resources consultant, with helping the town get HPID certified. Implementation of the HPID, however, has been indefinitely deferred. The town has been implementing the ACA reinsurance fee. Mr. LaClair recently went to an ACA training session, and admitted that the administration of the ACA f has been burdensome for the BoE. Mr. Lindberg noted that the Cadillac Tax, a revenue driving tax, will be instituted in 2018. Conversations are still ongoing, but he expects that its basic framework will remain unchanged. He will keep the committee updated.
2. Property Casualty Insurance Issues - Carol Fitzsimons of CIRMA
On behalf of CIRMA, Ms. Fitzsimons offered a 1-page discussion outline and a 4-page bar graph report illustrating WC and LAP losses for the town and the BoE as of October 31, 2014.
Loss Experiences. Ms. Fitzsimons gave an update on loss experiences since October 31, 2014. There has been little change since the last meeting. However, the number of WC losses for the town that are over $25,000 has been reduced by one.
Update on Risk Management Activities. Since September 24, 2014, CIRMA has provided the following training in Simsbury: 1. Two “Preventing Sexual Harassment” workshops, 2. A workshop for the volunteer fire department, and 3. A workshop for seasonal C, P, & R employees. CIRMA has also created its own managed care / preferred provider network. It will include the same doctors who were in the old Coventry Network, but will now give CIRMA the ability to control which new doctors will be in network. Fee structures will generally remain consistent.
CIRMA update. CIRMA has grown with 20 to 25 new members in the last two years. It’s seen an uptick in members who wish to join at the last minute. Ms. Fitzsimons reported that CIRMA’s annual meeting will take place on 1/30/2015.
3. Other Insurance Matters. Mr. Mikkelson suggested that the town and board should keep employees up-to-date on health insurance news through educational emails and posters. He also mentioned that it might be beneficial to cover the topic, “How to have a conversation with your doctor.”
Mr. Mason adjourned the meeting at 8:55 a.m.
Respectfully submitted,
Lorrie McElligott,
Commission Clerk