Medical Plan AnalysisReview of Consortiums / TPA / Network / Stop Loss

March 2013

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Agenda

I. Willis Public Sector Practice Group

II. Purpose Of The Review

III. Scope of Project & Progress To Date

IV. Next Steps

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Willis Public Sector Practice Group

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Introductions

Ryan L. Barbieri – Sr. Vice PresidentMember of the Willis Public Sector Practice Group

Consultant for Katonah Lewisboro S.D. on medical and pharmacy coverage and leads efforts with carrier negotiations

Leads a team of insurance professionals• Sharon Schulteis – Sr. Client Manager• Sara Malchow – Marketing Manager• Luke Allenson – Underwriting Consultant• Kathy Dobrzynski – Sr. Vice President & Actuary

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The Willis Public Sector Practice Group Dedicated team of professionals with more than 150 years

combined insurance experience

Services Include:• Communication strategies• Facilitating employee benefits competitive bid process• Technical Claims Analysis• GASB and OPEB resources• Pharmacy consulting• Assisting with union negotiations

Work with public sector employers across the United States

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Purpose Of This Market Study

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Business Case

Rising Expense and Declining Revenue

Rising Cost Environment Medical trend continues to run 5% above normal inflation

7-8% Eastern U.S. Medical Trend KLSD utilization trends over 3 years have been relatively high

2012 – 2013 slightly better than normal Alternatives have been considered at a high level in the past

Consortium Plans‒ PNW BOCES‒ SWSCHP

State Run Health Insurance Programs‒ NYSHIP

These options have historically shown lower premiums

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Due Diligence

As One Of The District’s Largest Annual Expenditures

Periodic Review Is Required Evaluation of multiple options to control district expenses Having the right program from a cost AND a benefit standpoint is

critical District Administration has tried to be as proactive as possible

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Scope of Project &Progress to Date

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Scope of the Market Study

Review All Viable Options

Third Party Administrator and Network Review Third Party Administrators

Approached 6 TPAs‒ Pomco (Inc.), UMR, Meritain, Empire Blue, Alicare and Aetna‒ Admin quotes received from all parties

Approached 10 Stop Loss carriers for reinsurance‒ 5 carriers presented options and 5 declined to quote

Network Analysis Considered four networks

‒ Pomco Allied (Inc.), UnitedHealthcare, Empire Blue and Aetna

‒ Conduct discount and disruption analysis

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Scope of the Market Study

Review All Viable Options, cont.

Review State and Consortium Health Insurance Plans State Plan

New York State Health Insurance Plan (NYSHIP) Two plans

‒ Excelsior and Empire Conduct cost benefit analysis

Consortium Plans Putnam Northern Westchester BOCES Plan and Statewide

Schools Health Insurance Plan (SWSCHP) Conduct cost benefit analysis

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Progress To Date

Good Progress Has Been Made

Highlights Of The Market Study Good response from all parties

There are multiple opportunities for savings with minimal member disruption

Evaluation continues on State and Consortium plans‒ Barriers to entry and exit may pose a challenge to consortiums‒ State plan offers multiple options

TPA options present some network savings with the addition of an integrated managed care program (Quantum Health)

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Next Steps

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Next Steps

Move Project To Completion

Finalize Disruption and Savings Analysis Target completion by end of May

Network analysis Lock stop loss terms

Discuss preliminary transition plans with all options Understand the process to help determine additional barriers if

they exist

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Questions?