HomeMy WebLinkAboutCOW 2012-11-13 Item 5B - Funding - Self-Insured Health Care Plan UpdateCOUNCIL AGENDA SYNOPSIS
Initia Is
Meeting Dates
11/13/112
Prepared by
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Mayor'srfiwieu i
ITEM INFORMATION
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O 21GINAll AGENDA ELY 'El : 111/ 13/12
AGLNDAITEM TITI,r Presentation ars Self -Insured Healthcare Plan Funding Clverview.
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Sii C IN SC R'S At their budget we rk sesslic n on Octoben 111, 2012, the City Ca uncil req a ested to neceiue an
SUMMARY actuarial report on the City's Selfl-Insu red Healthcare Plan.
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RECOMMENDAT IONS:
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COST IMPACT / FUND SOURCE
ENPEN U ITU RE R.Ec UIRHDI AMOUNT BUDGE1HD AHPROHRIATION REQUIRED
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C ananl eints:
MTG. DATE
RIECOFID CFI COUNCIL ACTION
MTG. DATE
ATTACHMENTS
11/13/ 12
Infonmational Memorandum dated 111/3) 12
20113 Healthcare Budget Projectiansi ton Alctiue Plan
20113 Healthcare Budget Projections IJeoff 1 Retirees
Presentation Materials - Health Plan Funding Overview
Minutes fire ml Ca unci) Budget We rkshop 11C/11) 12
12
City of Tukwila
Jim Haggertan, Mayor
INIRORIMATIONAU MEMORANDUM
TO: Maya r H aggerta ri
City CoL ncil
FIROM: E 1epf• anion Brown, I- L man F esources ❑ireci on
❑ATB: Naven' ber 71, 2013
SUB, BC1I: Self -Insured HeaI111 caner Plan Fu nc irig Overview
ISISIL 9
At the Ocotoben 11, 2012 BL c get Work Session, 11. El CIi1y Council negL e.Iieic that stafil provide an
actuarial report on the City 'sI Self-Irlsi. reed F ealthcare Alan.
RECOMMEN OAI11ION
T11is is irillcormaticorl only, and no Coy, nail aciicorl is reqi ired.
A1I11AC H MEIN TSI
2CI13 F ealthcare Bi. dget Anojeci icons for Alctive Alan
2CI13 F ealthcare Bi. dget Areojeci icons for Leofil 1 F e1 irees
Presentation on HealiI- Plan Fi.ndireg O\eormiew
Mini.tes 11nom Octoben 11, 2(112 Council Budget VAorekshorl
13
14
CITY OF TUKWILA
2013 Healthcare
Budget Projections —
LEOFF 1 Retirees
October 11, 2012
�ealthcare ,�ctuaries
16519 107th Place NE
Bothell, Washington 98011
t: (425) 939-7444
f: (425) 939-0089
www.HealthcareActuaries.com
15
O)
TABLE OF CONTENTS
Introduction 1
Composite Rate Development 2
Composite Rate Funding Projections 8
Incurred but Not Reported (IBNR) Claims Estimates 11
Projected Fund Expenses 13
Monthly Rates 15
INTRODUCTION
Healthcare Actuaries prepared this report for the City of Tukwila. The purpose of this report is to provide 2013 healthcare funding rates based
on the City's goal to maintain reserves equal to 2.5 times IBNR (1 x IBNR to fund the IBNR reserve, plus 1.5 x IBNR for contingencies) in the
City's LEOFF 1 Medical Self -Insurance Fund (Fund 503).
Information Regarding the Data
The basis for this report is information provided by the City, the City's broker (R.L. Evans Company, Inc.), and the City's third -party
administrator (Healthcare Management Administrators, or HMA). The information provided appears to be reasonable; however, we did not
audit it nor verify it for accuracy.
Report Contents Et Scope
This report includes the following information:
• market trend rates for medical, pharmacy, and dental coverage;
• analysis of plan -specific trend rates separately for medical, pharmacy, dental, and vision benefits;
• projected composite rates, separately for medical, pharmacy, dental, and vision benefits;
• proposed rates for medical/pharmacy, dental, and vision benefits by plan and tier;
• development of annual budgets for the City's Medical Self -Insurance Fund for 2013 through 2015.
City of Tukwila 2013 Renewal Report 1 10/11/2012
00
COMPOSITE RATE DEVELOPMENT
Introduction
We developed funding rates for the medical/pharmacy, dental, and vision plans using the following general process:
1) Collected, analyzed, and reviewed historical claims experience.
2) Adjusted paid claims for historical plan design changes and for stop -loss recoveries.
3) Reviewed large claims to determine if adjustments are necessary due to an unusually high number of large claims, or for individual cases of
an unusually high dollar amount.
4) Calculated and compared historical trend rates with market trend rates; selected trend assumptions.
5) Using adjusted historical claims and enrollment and assumed trend rates, calculated projected claims for the remainder of the 2012 plan
year and the 2013 plan year.
Historical Experience
The development of projected funding rates depends on historical claims information, including the number of covered employees or members
by month, paid claims by month and large claims information. Historical information is also useful in understanding the performance of the
plans, and how one might expect them to perform in the near future.
Healthcare Reform and Plan Design Changes
After a review of historical experience, we documented historical and future plan design changes and developed adjustment factors. For 2013,
there are no benefit adjustments.
Large Claims Adjustment
In addition to plan design changes, we performed a review of large claims to determine the frequency and magnitude of large claims. If one or
more large claims exist that one would not expect to recur in future years, or if the number of claims is outside expected levels, removing a
portion of the large claims would be appropriate. There were no large claims for retirees in 2011 or year-to-date 2012. We removed stop -loss
recoveries received for the portion of large claims in excess of the specific stop -loss deductible, since the stop -loss carrier covers that portion
of those claims.
Trend Analysis
We developed plan -specific trend rates using adjusted historical claims and enrollment using exponential regression techniques applied to a
rolling twelve-month average of paid claims per employee per month (PEPM). We calculated trend rates for the most recent 12 and 24 months
of rolling -twelve-month claims data for the medical, pharmacy, dental and vision claims. Given the small number of covered employees and
members, one cannot rely entirely on plan -specific trend rates alone. There is too much variability in trend rates for the plan -specific trend
data to be credible on its own. Therefore, we use a weighted average of the plan -specific trend rates and market trend rates to set the trend
rates used in the projections. The results of the analysis follow, including a comparison to market trend rates and the applied trend rates used
in the projections:
City of Tukwila 2013 Renewal Report 2 10/11/2012
Plan
Selected Plan -
Plan -Specific Specific Trend Recent Market Applied Trend
Time Period Trend Rates Rate Trend Rates' Rate
Medical
Pharmacy
Dental
Vision
24 months
-25.1%
12 months
24 months
-14.6%
91.0%
12 months
24 months
138.2%
-14.6%
91.0% 6.5%3
6.6%2
5.5%
10.7%
-1.3%
12 months
24 months
-4.5%
6.6%
12 months -15.1%
-1.3% 6.2%4 5.5%
6.6% 3.9%5 4.2%
Exhibits A through D show the development of the trend rates based on 12 -month rolling averages.
1 2012 Segal Health Plan Cost Trend Survey or Arlen Group Trends for 2nd quarter 2012.
2 Segal Health Plan Cost Trend for Medicare Advantage FFS or PPOs, Projected 2012 w/o Rx.
3 Segal Health Plan Cost Trend for Retirees Age 65+ for Rx.
4 Arlen Group Trend for FFS/Indemnity Dental Plans.
5 Segal Health Plan Cost Trend for Reasonable and Customary (RFtC) Vision Plans.
City of Tukwila 2013 Renewal Report 3
10/11/2012
$900
$800
$700
$600
$500
Cost $400
PEPM
$300
$200
$100
Exhibit A
CITY OF TUKWILA
Medical Trend: Rolling -12 -Month Exponential Trend (LEOFF 1 Retirees)
1
-$100
A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J
2010 2011 2012
-PEPM (lagged 2 months) Rolling 12 -Month Average Exponential Trend @ -14.6%
City of Tukwila 2013 Renewal Report
4
10/11/2012
Cost
PEPM
$2,500
$2,000
$1,500
$1,000
$500
CITY OF TUKWILA
Rx Trend: Rolling -12 -Month Exponential Trend (LEOFF 1 Retirees)
Exhibit B
$0
A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J
2010 2011 2012
-PEPM (lagged 0 months)
Rolling 12 -Month Average Exponential Trend @ 91.0%
IV
City of Tukwila 2013 Renewal Report 5 10/11/2012
Cost
PEPM
$250
$200
$150
$100
$50
$0
Exhibit C
CITY OF TUKWILA
Dental Trend: Rolling -12 -Month Exponential Trend (AU Participants)
ASOND J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J
2010 2011 2012
�PEPM (lagged 1 month) Rolling 12 -Month Average Exponential Trend ® -1.3%
City of Tukwila 2013 Renewal Report 6
10/11/2012
$30
$25
$20
Cost
PEPM $15
$10
$0
Exhibit D
CITY OF TUKWILA
Vision Trend: Rolling -12 -Month Exponential Trend (All Particpants)
1
A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J
2010 2011 2012
-PEPM (lagged 1 month) Rolling 12 -Month Average Exponential Trend ® 6.6%
City of Tukwila 2013 Renewal Report
7
10/11/2012
COMPOSITE RATE FUNDING PROJECTIONS
We developed projected funding rates based on the most recent thirty-six months of adjusted paid claims, net of any specific stop -loss
recoveries. We developed projected funding rates on a "paid" rather than an "incurred" basis, since the City budgets the change in IBNR
separately. Next, we divided paid claims by the number of covered employees, resulting in projected paid claims per employee per month
(PEPM). Then we lagged the number of covered employees utilized by two months for medical, zero months for pharmacy, one month for
dental, and one month for vision, to provide a better match between enrollment and paid claims (this approximates incurred claims). Finally,
we adjusted projected paid claims PEPM for trend from the midpoint of the experience period to the midpoint of the renewal period.
The result is projected paid claims PEPM. To this, we added administration costs and stop -loss premiums. We did not add an explicit margin for
claims fluctuations because the amount of the reserve in the fund balance is sufficient to cover expected claim fluctuations.
Exhibit E illustrates the funding projections for 2012. We based total projected costs for the year on actual results for January through July,
and projected results for August through December.
Exhibit F illustrates the funding projections for 2013.
City of Tukwila 2013 Renewal Report 8 10/11/2012
Exhibit E
CITY OF TUKWILA
Projected Costs for the LEOFF 1 Retiree Plans
for the Period January 1, 2012 - December 31, 2012
Projected Costs for 8/1/2012 through 12/31/2012
Net adjusted paid claims for the 36 months ending 7/31/2012
Covered retirees for the 36 months ending 5/31/2012, 7/31/2012,
6/30/2012, and 6/30/2012, respectively
Claims cost per employee per month
Impact of future plan design changes (if any)
Trend ® 5.5%, 10.7%, 5.5%, and 4.2% for 20.5 months
Trended claims cost per employee per month with margin
Administrative costs per employee per month
Stop -loss premiums per employee per month
Projected composite funding per employee per month, participating
Current number of employees
Number of months in rest of year
Projected total costs for 8/1/2012 through 12/31/2012
Combined total costs for 8/1/2012 through 12/31/2012
Actual Costs Through 7/31/2012
Net paid claims for 2012 year-to-date through July, by plan
Actual administration costs
Actual stop -loss premiums
Total actual costs
Projected total costs for the current plan year
Notes:
Medical Rx Dental Vision
$337,797 $389,490 $105,817 $16,695
- 1,372
_ $246.21
x 1.0000
x 1.0965
_ $269.97
+ $24.65
+ $35.01
_ $329.63
x 37
x 5
_ $60,982
1,374
$283.47
1.0000
1.1901
$337.36
$4.25
n/a
$341.61
37
5
$63,198
1,373 1,373
$77.07 $12.16
0.8581 1.0000
1.0949 1.0723
$72.41 $13.04
$5.75 $0.75
n/a n/a
$78.16 $13.79
37 37
5 5
$14,460 $2,551
$141,190
$72,166
$77,544
$29,815
$877
$10,709
$9,278
$200,389
$341,579
• Historical paid claims are net of stop -loss recoveries and Caremark rebates, and adjusted for historical plan design changes.
• Medical administrative costs include the following fees PEPM: medical ASO fees of 515.95, medical management fees of 53.20, PPO access fees of 55.50.
• Prescription drug administrative costs include fees of $4.25 PEPM.
• Dental plan administrative costs include ASO fees of $5.75 PEPM.
• Vision plan administrative costs include ASO fees of 50.75 PEPM.
• Specific stop -loss premiums (PEPM) are $35.01 for employees and $52.52 for dependent units.
City of Tukwila 2013 Renewal Report
9 10/11/2012
CITY OF TUKWILA
Projected Monthly Funding for the LEOFF 1 Retiree Plans
for the Period January 1, 2013 - December 31, 2013
Net adjusted paid claims for the 36 months ending 7/31/2012
Medical Rx Dental Vision
$337,797 $389,490 $105,817 $16,695
Covered retirees for the 36 months ending 5/31/2012, 7/31/2012,
6/30/2012, and 6/30/2012, respectively- 1,372 1,374 1,373 1,373
Claims cost per employee per month
Impact of future plan design changes (if any)
Trend @ 5.5%, 10.7%, 5.5%, and 4.2% for 29 months
Trended claims cost per employee per month with margin
Administrative costs per employee per month
Stop -loss premiums per employee per month (estimated)
Projected composite funding per employee per month
Total composite funding per employee per month
Current composite funding per employee per month
Required increase
= $246.21 $283.47 $77.07 $12.16
x 1.0000 1.0000 0.8581 1.0000
x 1.1392 1.2792 1.1368 1.1038
= $280.48 $362.62 $75.18 $13.42
+ $25.22 $4.50 $4.38 $0.77
+ $45.28 n/a n/a n/a
= $350.98 $367.12 $79.56 $14.19
$732.30 $79.56
= $976.79 $59.16
= -25.0% 34.5%
Recommended increase
0.0% 0.0% 0.0%
Notes:
• Historical paid claims are net of stop -loss recoveries and Caremark rebates, adjusted for historical plan design changes.
• Medical administrative costs include the following fees PEPM: medical ASO fees of S16.43, medical management fees of $3.30, PPO access fees of S5.50.
• Prescription drug administrative costs include fees of S4.50 PEPM.
• Dental plan administrative costs include ASO fees of S4.38 PEPM.
• Vision plan administrative costs include ASO fees of S0.77 PEPM.
• Specific stop -loss premiums (PEPM) are estimated to increase by 29.3% to $45.28 for employees and S67.93 for dependent units.
City of Tukwila 2013 Renewal Report
10
Exhibit F
10/11/2012
INCURRED BUT NOT REPORTED CLAIMS ESTIMATES
This section of the report provides IBNR estimates to use in the "Health Self -Insurance Fund: Statement of Revenue Et Expense".
We estimated the incurred but not reported (IBNR) liability as of July 31, 2012 using actuarial methods. Based on the results, as well as a
review of actual run -out, we selected average lag days of 67.5 days, 23.6 days, 31.2 days, and 58.4 days for medical, pharmacy, dental, and
vision, respectively. These are within expected norms. Using average lag days and net adjusted paid claims, we estimated the IBNR liability as
of July 31, 2012. Next, we developed the estimated IBNR liability as of December 31, 2012 by trending the July 31, 2012 estimates to year-end.
We did not add an explicit margin for claims fluctuations because the amount of the reserve in the fund balance is sufficient to cover expected
claim fluctuations. We then added administrative costs. We estimated IBNR liabilities for future periods by applying trend.
Finally, we allocated the liability to actives and LEOFF 1 retirees based on headcount as of July 31, 2012. Exhibit G shows IBNR estimates for
LEOFF 1 retirees.
N
City of Tukwila 2013 Renewal Report 11 10/11/2012
Exhibit G
City of Tukwila
Estimated IBNR - LEOFF 1 Retirees
Medical, Rx, Dental, and Vision
Medical Rx Dental Vision Total
Average claim lag in days 67.5 23.6 31.2 58.4
Divided by the number of days in the 12 months ending 7/31/2012 ÷ 366.00 366.00 366.00 366.00
Portion of year = 0.1844 0.0645 0.0852 0.1596
Net paid claims in the 12 months ending 7/31/2012* x $3,094,544 $805,327 $573,863 $25,417
Unadjusted IBNR = $570,715 $51,928 $48,919 $4,056
Trend adjustment x 1.0444 1.0404 1.0228 1.0167
Exposure adjustment x 0.9860 1.1004 1.1851 0.7035
Estimated IBNR = $587,701 $59,449 $59,296 $2,901
Estimated administration* x $1,922 $527 $688 $90
Number of actives and retirees as of 7/31/2012 ÷ 343 343 363 195
Number of retirees as of 7/31/2012 x 39 39 39 39
Total estimated IBNR as of 12/31/2012, rounded = $68,700 $7,300 $7,100 $700
Recommended IBNR as of 12/31/2012, rounded $68,700 $7,300 $7,100 $700
Total estimated IBNR as of 12/31/2013, rounded = $72,500 $8,100 $7,500 $700
Total estimated IBNR as of 12/31/2014, rounded = $76,500 $9,000 $7,900 $700
Total estimated IBNR as of 12/31/2015, rounded = $80,700 $10,000 $8,300 $700
Notes:
* Paid claims are net of stop -loss recoveries.
** HMA charges 3 months of administrative fees (excluding PPO access fees) to adjudicate 12 months of run -out claims. This is the basis for the
administrative fees included above. Ston -loss premiums are not included.
$83,800
$83,800
$88,800
$94,100
$99,700
City of Tukwila 2013 Renewal Report 12 10/11/2012
PROJECTED FUND EXPENSES
Exhibit H on the following page provides a statement of revenue and expense for 2012 through 2015. The purpose of this exhibit is to
determine the rate increases necessary to meet the City's financial goal of maintaining reserves at 1 x IBNR for claims fluctuations plus 1.5 x
IBNR for the IBNR liability itself (2.5 x IBNR, in total). The source of each item follows:
• For the first 7 months of 2012, medical/Rx, dental, and vision premiums paid to the fund use actual accruals. For the last 5 months of
2012, premiums paid use enrollment, as shown in Exhibit I, multiplied by the current rates for 2012. We assumed no change in the HMA
rates for 2013, 2014, and 2015. We also applied no increase to the dental and vision premiums for 2013, 2014, or 2015.
• The City elected not to fund the LEOFF 1 premiums in 2013 and 2014. We added an adjustment to the Fund Income to account for this
reduction in funding. The rate exhibits show the premiums in full, for use in calculating COBRA rates.
• Medical/Rx, dental, and vision claims and related plan costs use the information shown in Exhibits E and F. We based the claims and
related plan costs for 2013 on the assumed increases shown in the exhibit.
• IBNR uses the estimates developed in Exhibit G.
• All other fund expenses use the information provided by the City's Finance Department or use the assumed increases shown in the exhibit
(as provided by Finance).
N
City of Tukwila 2013 Renewal Report 13 10/11/2012
CITY OF TUKWILA
Health Self -Insurance Fund 503: Statement of Revenue and Expense - LEOFF 1 Retirees
Accounts
Plan
2013
2014
2015
Funding Rate Changes
Medical/Rx
0.0%
0.0%
0.0%
-1.4% 0.0% 0.0%
4.1% 3.5% 1.9%
Dental
0.0%
0.0%
0.0%
Administrative Costs
Vision
0.0%
0.0%
0.0%
Accounts
Forecasts
Change
# 'Account Name
2012 1 2013 1 2014 1 2015
2013 1 2014 1 2015
Revenue
1.1
1.2
City Contributions - HMA
Interest
$466,661 $459,962 $459,962 $459,962
$3,552 $3,697 $3,828 $3,899
-1.4% 0.0% 0.0%
4.1% 3.5% 1.9%
Total - Revenue
$470,213 $463,659 $463,790 $463,861
-1.4% 0.0% 0.0%
Expense
Administrative Costs
2.1
2.2
2.3
2.4
2.5
2.6
2.7
2.8
ASO, UR, PPO, HIPAA, COBRA
Stop -Loss Insurance Premiums
Miscellaneous a Broker Fees
City Support Services
GASB
Audit
Patient -Centered Outcomes Trust Fees
LTC Insurance
$17,259 $15,485 $16,259 $17,072
$15,755 $20,104 $23,120 $26,588
$2,040 $2,040 $2,040 $2,040
$4,619 $9,619 $9,909 $10,206
$10,000 $10,000 $10,000 $10,000
$700 $0 $0 $800
$0 $37 $74 $74
$8,535 $8,962 $9,410 $9,881
-10.3% 5.0% 5.0%
27.6% 15.0% 15.0%
0.0% 0.0% 0.0%
108.2%I 3.0% 3.0%
0.0% 0.0% 0.0%
100.0% 0.0% 100.0%
100.0% 100.0% 0.0%
5.0% 5.0% 5.0%
Subtotal - Administrative Costs
$58,908 $66,247 $70,812 $76,661
12.5% 6.9% 8.3%
Claim Payments
3.1
3.2
3.3
Medical/Pharmacy - Claim Payments
Dental - Claim Payments
Vision - Claim Payments
$262,067 $285,537 $309,704 $335,916
$43,211 $33,380 $35,199 $37,117
$3,289 $5,958 $6,206 $6,465
9.0%
-22.8%
81.1%
8.5% 8.5%
5.5% 5.5%
4.2% 4.2%
Subtotal - Claim Payments
$308,567 $324,875 $351,109 $379,498
5.3% 8.1% 8.1%
Total - Expense
$367,475 $391,122 $421,921 $456,159
6.4% 7.9% 8.1%
Net Total - Fund Income
$102,739 $72,537 $41,869 $7,702
-29.4% -42.3% -81.6%
Adjustment to Fund Income
$0 ($459,962) ($459,962) $0
n/a 0.0% -100.0%
Adjusted Fund Income
$102,739 ($387,425) ($418,093) $7,702
-477.1% 7.9% -101.8%
IBNR Funding
4.1
4.2
Beginning IBNR Reserve
Ending IBNR Reserve
$55,200 $83,800 $88,800 $94,100
$83,800 $88,800 $94,100 $99,700
51.8% 6.0% 6.0%
6.0% 6.0% 6.0%
Change in IBNR
($28,600) ($5,000) ($5,300) ($5,600)
-82.5% 6.0% 5.7%
Fund Balance (Net of IBNR Reserve)
5.1
5.2
Beginning Fund Balance
Ending Fund Balance'
$1,822,186 $1,896,324 $1,963,861 $2,000,430
$1,896,324 $1,963,861 $2,000,430 $2,002,532
4.1% 3.6% 1.9%
3.6% 1.9% 0.1%
Target Goal
Ending Fund Balance + IBNR Reserve2 22.63 22.12 21.26 20.09
Footnotes:
1. Ending Fund Balance = Beginning Fund Balance + Fund Income + Change In IBNR
2. Target Goal = 2.5. One times IBNR for IBNR plus 1.5 times IBNR for contingencies = 2.5 x IBNR.
City of Tukwila 2013 Renewal Report
Exhibit H
14 10/11/2012
MONTHLY RATES
Exhibit 1 provides monthly rates for the health plans for 2012 and 2013. There are no retiree contributions.
Enrollment uses July 2012 enrollment provided by the City of Tukwila and HMA. We assumed no change in total enrollment in 2013.
Exhibit J provides all COBRA rates for 2013.
W
City of Tukwila 2013 Renewal Report 15 10/11/2012
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N
Exhibit 1
CITY OF TUKWILA
2012 &t 2013 Monthly Rates — LEOFF 1 Retirees
TOTAL ANNUAL AMOUNT
2012
2013
Vision
Med/Rx
Dental
Vision
Dental
Vision
Total]
Med/Rx
Dental
Vision
n/a
$433,695
37
n/a
Enrollment
Enrollment
Enrollment
Med / Rx
Dental
Vision
Total
Enrollment*
Enrollment*
Enrollment*
Med / Rx
Dental
Vision
Total
LEOFF 1 Retirees
n/a
n/a
37
$0
n/a
n/a
37
$0
Total
37
37
37
Medicare -ineligible
7
7
7
$976.79
$59.16
$0.00
$1,035.95
7
7
7
$976.79
$59.16
$0.00
$1,035.95
Medicare -eligible
30
30
30
$976.79
$59.16
$0.00
$1,035.95
30
30
30
$976.79
$59.16
$0.00
$1,035.95
TOTAL ANNUAL AMOUNT
Med/Rx
Dental
Vision
Total
Med/Rx
Dental
Vision
Total]
• HMA Medical/Rx
37
n/a
n/a
$433,695
37
n/a
n/a
$433,695
• Dental
n/a
37
n/a
$26,267
n/a
37
n/a
$26,267
• Vision
n/a
n/a
37
$0
n/a
n/a
37
$0
Total
37
37
37
$459,962
37
37
37
$459,962
"Based on a projected increase in headcount of 0 employees.
City of Tukwila 2013 Renewal Report 16 10/11/2012
Exhibit J
CITY OF TUKWILA
2012 Et 2013 Monthly COBRA Rates
City of Tukwila 2013 Renewal Report
17
10/11/2012
2012
2013
Med/Rx
Enrollment
Dental
Enrollment
Vision
Enrollment
Med/Rx
Dental
Vision
Total
Med/Rx
Enrollment
Dental
Enrollment
Vision
Enrollment
Med/Rx
Dental
Vision
Total
HMA COBRA REGULAR
0 0 0 0 0 0
0 0 0 0 0 0
0 0 0 0 0 0
Employee Only
0
0
0
$427.72
$80.18
$12.24
$520.14
$427.72
$80.18
$12.24
$520.14
Employee + Spouse
0
0
0
$900.87
$168.40
$12.24
$1,081.51
$900.87
$168.40
$12.24
$1,081.51
Employee + Spouse + Child
0
0
0
$1,122.41
$216.53
$12.24
$1,351.18
$1,122.41
$216.53
$12.24
$1,351.18
Employee + Spouse + Children
0
0
0
$1,303.82
$256.64
$12.24
$1,572.70
$1,303.82
$256.64
$12.24
$1,572.70
Employee + Child
0
0
0
$649.25
$128.31
$12.24
$789.80
$649.25
$128.31
$12.24
$789.80
Employee + Children
0
0
0
$830.66
$168.42
$12.24
$1,011.32
$830.66
$168.42
$12.24
$1,011.32
Spouse Only
2
2
0
$473.15
$88.22
$12.24
$573.61
2
2
0
$473.15
$88.22
$12.24
$573.61
Child Only
1
1
0
$221.53
$48.13
$12.24
$281.90
1
1
0
$221.53
$48.13
$12.24
$281.90
HMA COBRA LEOFF
0 0 0 0 0 0
0 0 0 0 0 0
0 0 0 0 0 0
Employee Only
0
0
0
$583.86
$80.18
$12.24
$676.28
$583.86
$80.18
$12.24
$676.28
Employee + Spouse
0
0
0
$1,057.02
$168.40
$12.24
$1,237.66
$1,057.02
$168.40
$12.24
$1,237.66
Employee + Spouse + Child
0
0
0
$1,278.55
$216.53
$12.24
$1,507.32
$1,278.55
$216.53
$12.24
$1,507.32
Employee + Spouse + Children
0
0
0
$1,459.95
$256.64
$12.24
$1,728.83
$1,459.95
$256.64
$12.24
$1,728.83
Employee + Child
0
0
0
$805.39
$128.31
$12.24
$945.94
$805.39
$128.31
$12.24
$945.94
Employee + Children
0
0
0
$986.80
$168.42
$12.24
$1,167.46
$986.80
$168.42
$12.24
$1,167.46
Spouse Only
0
0
0
$473.16
$88.22
$12.24
$573.62
0
0
0
$473.16
$88.22
$12.24
$573.62
Child Only
0
0
0
$221.53
$48.13
$12.24
$281.90
0
0
0
$221.53
$48.13
$12.24
$281.90
GROUP HEALTH COBRA REGULAR
0 0 0 0 0 0
0 0 0 0 0 0
Employee Only
0
0
0
$522.68
$80.18
$0.00
$602.86
0
$614.13
$80.18
$0.00
$694.31
Employee + Spouse
0
0
0
$1,052.92
$168.40
$0.00
$1,221.32
0
$1,237.14
$168.40
$0.00
$1,405.54
Employee + Spouse + Child
0
0
0
$1,322.89
$216.53
$0.00
$1,539.42
0
$1,554.35
$216.53
$0.00
$1,770.88
Employee + Spouse + Children
0
0
0
$1,592.19
$256.64
$0.00
$1,848.83
0
$1,870.77
$256.64
$0.00
$2,127.41
Employee + Child
0
0
0
$792.63
$128.31
$0.00
$920.94
0
$931.32
$128.31
$0.00
$1,059.63
Employee + Children
0
0
0
$1,061.95
$168.42
$0.00
$1,230.37
0
$1,247.77
$168.42
$0.00
$1,416.19
Spouse Only
0
0
0
$530.24
$88.22
$0.00
$618.46
0
0
0
$623.01
$88.22
$0.00
$711.23
Child Only
0
0
0
$269.95
$48.13
$0.00
$318.08
0
0
0
$317.19
$48.13
$0.00
$365.32
GROUP HEALTH COBRA LEOFF
0 0 0 0 0 0
0 0 0 0 0 0
0 0 0 0 0 0
Employee Only
0
0
0
$673.23
$80.18
$0.00
$753.41
$791.05
$80.18
$0.00
$871.23
Employee + Spouse
0
0
0
$1,203.46
$168.40
$0.00
$1,371.86
$1,414.06
$168.40
$0.00
$1,582.46
Employee + Spouse + Child
0
0
0
$1,473.44
$216.53
$0.00
$1,689.97
$1,731.29
$216.53
$0.00
$1,947.82
Employee + Spouse + Children
0
0
0
$1,742.74
$256.64
$0.00
$1,999.38
$2,047.72
$256.64
$0.00
$2,304.36
Employee + Child
0
0
0
$943.18
$128.31
$0.00
$1,071.49
$1,108.24
$128.31
$0.00
$1,236.55
Employee + Children
0
0
0
$1,212.50
$168.42
$0.00
$1,380.92
$1,424.69
$168.42
$0.00
$1,593.11
Spouse Only
0
0
0
$530.24
$88.22
$0.00
$618.46
0
0
0
$623.01
$88.22
$0.00
$711.23
Child Only
0
0
0
$269.95
$48.13
$0.00
$318.08
0
0
0
$317.19
$48.13
$0.00
$365.32
TOTAL ANNUAL AMOUNT
Med/Rx
Dental
Vision
Total
Med/Rx
Dental
Vision
Total
• HMA Medical/Rx
3
n/a
n/a
$14,014
3
n/a
n/a
$14,014
• Dental
n/a
3
0
$2,695
n/a
3
0
$2,695
• Vision
n/a
n/a
0
$0
n/a
n/a
0
$0
• Group Health Medical/Rx
0
n/a
n/a
$0
0
n/a
n/a
$0
Total
3
3
0
$16,709
3
3
0
$16,709
City of Tukwila 2013 Renewal Report
17
10/11/2012
W
CITY OF TUKWILA
2013 Healthcare
Budget Projections —
Active Employees
October 11, 2012
,P5 ealthcare
Actuaries
16519 107th Place NE
Bothell, Washington 98011
t: (425) 939-7444
f: (425) 939-0089
www.HealthcareActuaries.com
35
TABLE OF CONTENTS
Introduction 1
Composite Rate Development 2
Composite Rate Funding Projections 10
Incurred but Not Reported (IBNR) Claims Estimates 13
Projected Fund Expenses 15
Monthly Rates a Employee Contributions 17
INTRODUCTION
Healthcare Actuaries prepared this report for the City of Tukwila. The purpose of this report is to provide 2013 healthcare funding rates based
on the City's goal to maintain reserves equal to 2.5 times IBNR (1 x IBNR to fund the IBNR reserve, plus 1.5 x IBNR for contingencies) in the
City's Medical Self -Insurance Fund (Fund 502).
Information Regarding the Data
The basis for this report is information provided by the City, the City's broker (R.L. Evans Company, Inc.), and the City's third -party
administrator (Healthcare Management Administrators, or HMA). The information provided appears to be reasonable; however, we did not
audit it nor verify it for accuracy.
Report Contents Et Scope
This report includes the following information:
• market trend rates for medical, pharmacy, and dental coverage;
• analysis of plan -specific trend rates separately for medical, pharmacy, dental, and vision benefits;
• projected composite rates, separately for medical, pharmacy, dental, and vision benefits;
• proposed rates for medical/pharmacy, dental, and vision benefits by plan and tier;
• development of annual budgets for the City's Medical Self -Insurance Fund for 2013 through 2015.
W
City of Tukwila 2013 Renewal Report 1 10/11/2012
COMPOSITE RATE DEVELOPMENT
Introduction
We developed funding rates for the medical/pharmacy, dental, and vision plans using the following general process:
1) Collected, analyzed, and reviewed historical claims experience.
2) Adjusted paid claims for historical plan design changes and for stop -loss recoveries.
3) Reviewed large claims to determine if adjustments are necessary due to an unusually high number of large claims, or for individual cases of
an unusually high dollar amount.
4) Calculated and compared historical trend rates with market trend rates; selected trend assumptions.
5) Using adjusted historical claims and enrollment and assumed trend rates, calculated projected claims for the remainder of the 2012 plan
year and the 2013 plan year.
Historical Experience
The development of projected funding rates depends on historical claims information, including the number of covered employees or members
by month, paid claims by month and large claims information. Historical information is also useful in understanding the performance of the
plans, and how one might expect them to perform in the near future.
Healthcare Reform and Plan Design Changes
After a review of historical experience, we documented historical and future plan design changes and developed adjustment factors. For 2013,
there are no benefit adjustments.
Large Claims Adjustment
In addition to plan design changes, we performed a review of large claims to determine the frequency and magnitude of large claims. If one or
more large claims exist that one would not expect to recur in future years, or if the number of claims is outside expected levels, removing a
portion of the large claims would be appropriate. Large claims for 2012 are higher than they were in 2011. They are 37.2% of medical and
pharmacy claims (through July), whereas in 2011 they were 24.2% (through December). We removed stop -loss recoveries received for the
portion of large claims in excess of the specific stop -loss deductible, since the stop -loss carrier covers that portion of those claims.
Trend Analysis
We developed plan -specific trend rates using adjusted historical claims and enrollment using exponential regression techniques applied to a
rolling twelve-month average of paid claims per employee per month (PEPM). We calculated trend rates for the most recent 12 and 24 months
of rolling -twelve-month claims data for the medical, pharmacy, dental and vision claims. Given the small number of covered employees and
members, one cannot rely entirely on plan -specific trend rates alone. There is too much variability in trend rates for the plan -specific trend
data to be credible on its own. Therefore, we use a weighted average of the plan -specific trend rates and market trend rates to set the trend
rates used in the projections. The results of the analysis follow, including a comparison to market trend rates and the applied trend rates used
in the projections:
City of Tukwila 2013 Renewal Report 2 10/11/2012
Exhibits A and B show market rates used by carriers in projecting renewal rates. Exhibits C through F show the development of the trend rates
based on 12 -month rolling averages.
1 2012 Segal Health Plan Cost Trend Survey or Arlen Group Trends for 2nd quarter 2012.
2 Arlen Group Trend for PPOs w/o Rx.
3 Arlen Group Trend for Rx.
4 Arlen Group Trend for FFS/Indemnity Dental Plans.
W 5 Segal Health Plan Cost Trend for Reasonable and Customary (RFtC) Vision Plans.
City of Tukwila 2013 Renewal Report 3
10/11/2012
Plan -Specific
Trend Rates
Selected Plan -
Specific Trend
Rate
Recent Market
Trend Rates'
Applied Trend
Rate
Plan
Time Period
Medical
24 months
4.5%
14.6%
10.6%2 11.0%
12 months
14.6%
Pharmacy
24 months
3.3%
8.8%
10.1%3 10.0%
12 months
8.8%
Dental
24 months
-0.1 %
-0.1%
0
6.2/ 0 4 5.6/
12 months
-4.6%
Vision
24 months
5.4%
5.4%
0 5 4.1 0
3.9/
12 months
1.9%
Exhibits A and B show market rates used by carriers in projecting renewal rates. Exhibits C through F show the development of the trend rates
based on 12 -month rolling averages.
1 2012 Segal Health Plan Cost Trend Survey or Arlen Group Trends for 2nd quarter 2012.
2 Arlen Group Trend for PPOs w/o Rx.
3 Arlen Group Trend for Rx.
4 Arlen Group Trend for FFS/Indemnity Dental Plans.
W 5 Segal Health Plan Cost Trend for Reasonable and Customary (RFtC) Vision Plans.
City of Tukwila 2013 Renewal Report 3
10/11/2012
CITY OF TUKWILA
Medical &t Rx Plans
Carrier Medical and Rx Trend Rates — Western U.S.
Category
2nd Quarter 2009 To 2nd Quarter 2012
Low
High
Average
2009 Q2 Last 13 Quarters 2012 Q2
HMO
12.1%
POS 12.2%
PPO 11.9%
HDHP n/a
Indemnity 15.5%
Rx 11.5%
10.1% 10.1%
10.0% 10.0%
10.6% 10.6%
9.9% 9.9%
13.6% 13.2%
10.1% 10.1%
12.9% 11.8%
13.1% 11.9%
12.8% 11.9%
12.6% 11.5%
15.5% 14.5%
12.3% 11.4%
Chart Notes: Red circles are the first and last months shown and correspond to the data points to the immediate left
and right of the chart. Blue squares correspond to the low and high data points. If the low or high point is the same as
an end point, it will only show a blue square. The black chart line shows the trends for each quarter. The dashed green
line is the average trend over the last 13 quarters.
City of Tukwila 2013 Renewal Report
Exhibit A
4 10/11/2012
CITY OF TUKWILA
Dental Plans
Carrier Dental Trend Rates — Western U.S.
Category
2nd Quarter 2009 To 2nd Quarter 2012
Low
High
Average
2009 Q2 Last 13 Quarters 2012 Q2
DMO
4.6%
DPO 7.0%
Indemnity 7.4%
3.6%
3.0%
5.4% 5.2%
6.2% 6.2%
4.8%
4.1
7.6% 6.5%
8.0% 7.1%
Chart Notes: Red circles are the first and last months shown and correspond to the data points to the immediate left
and right of the chart. Blue squares correspond to the low and high data points. If the low or high point is the same as
an end point, it will only show a blue square. The black chart line shows the trends for each quarter. The dashed green
line is the average trend over the last 13 quarters.
City of Tukwila 2013 Renewal Report
Exhibit B
5 10/11/2012
$1,600
$1,400
$1,200
$1,000
Cost $800
PEPM
$600
$400
$200
so
Exhibit C
CITY OF TUKWILA
Medical Trend: Rolling -1 2 -Month Exponential Trend (Actives)
1
A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J
2010 2011 2012
�PEPM (lagged 2 months) Rolling 12 -Month Average ®Exponential Trend ® 14.6%
City of Tukwila 2013 Renewal Report 6
10/11/2012
$300
$250
$200
Cost $150
PEPM
$100
$50
Exhibit D
CITY OF TUKWILA
Rx Trend: Rolling -12 -Month Exponential Trend (Actives)
so
ASOND JFMAMJ J A SOND JFMAMJ J A SOND JFMAMJJ
2010 2011 2012
®PEPM (lagged 0 months)
Rolling 12 -Month Average Exponential Trend ® 8.8%
W City of Tukwila 2013 Renewal Report 7
10/11/2012
Cost
PEPM
$250
$200
$150
$100
$50
$0
Exhibit E
CITY OF TUKWILA
Dental Trend: Rolling -12 -Month Exponential Trend (Actives)
ASOND JFMAMJ J ASOND JFMAMJ J ASOND JFMAMJ J
2010 2011 2012
�PEPM (lagged 0 months) Rolling 12 -Month Average Exponential Trend ® -0.1%
City of Tukwila 2013 Renewal Report 8 10/11/2012
$35
$30
$25
$20
Cost
PEPM
$15
$10
$0
Exhibit F
CITY OF TUKWILA
Vision Trend: Rolling -12 -Month Exponential Trend (Actives)
1
A SOND JFMAMJ J ASOND JFMAMJ J ASOND JFMAMJ J
2010 2011 2012
�PEPM (lagged 0 months) Rolling 12 -Month Average ®Exponential Trend ® 5.4%
City of Tukwila 2013 Renewal Report
9
10/11/2012
COMPOSITE RATE FUNDING PROJECTIONS
We developed projected funding rates based on the most recent twelve months of adjusted paid claims, net of any specific stop -loss
recoveries. We developed projected funding rates on a "paid" rather than an "incurred" basis, since the City budgets the change in IBNR
separately. Next, we divided paid claims by the number of covered employees, resulting in projected paid claims per employee per month
(PEPM). Then we lagged the number of covered employees utilized by two months for medical, zero months for pharmacy, one month for
dental, and one month for vision, to provide a better match between enrollment and paid claims (this approximates incurred claims). Finally,
we adjusted projected paid claims PEPM for trend from the midpoint of the experience period to the midpoint of the renewal period.
The result is projected paid claims PEPM. To this, we added administration costs and stop -loss premiums. We did not add an explicit margin for
claims fluctuations because the amount of the reserve in the fund balance is sufficient to cover expected claim fluctuations.
Exhibit G illustrates the funding projections for 2012. We based total projected costs for the year on actual results for January through July,
and projected results for August through December.
Exhibit H illustrates the funding projections for 2013.
City of Tukwila 2013 Renewal Report 10 10/11/2012
Exhibit G
CITY OF TUKWILA
Projected Costs for the Active Plans
for the Period January 1, 2012 - December 31, 2012
Projected Costs for 8/1/2012 through 12/31/2012
Net adjusted paid claims for the 12 months ending 7/31/2012
Covered employees for the 12 months ending 5/31/2012, 7/31/2012,
6/30/2012, and 6/30/2012, respectively
Claims cost per employee per month
Impact of future plan design changes (if any)
Trend ® 11.0%, 10.0%, 5.6%, and 4.1% for 8.5 months
Trended claims cost per employee per month with margin
Administrative costs per employee per month
Stop -loss premiums per employee per month
Projected composite funding per employee per month, participating
Current number of employees
Number of months in rest of year
Projected total costs for 8/1/2012 through 12/31/2012
Combined total costs for 8/1/2012 through 12/31/2012
Actual Costs Through 7/31/2012
Net paid claims for 2012 year-to-date through July, by plan
Actual administration costs
Actual stop -loss premiums
Total actual costs
Projected total costs for the current plan year
Notes:
Medical Rx Dental Vision
$2,993,204 $608,619 $535,675 $21,336
3,627
_ $825.26
x 1.0000
x 1.0767
_ $888.55
+ $24.65
+ $77.86
_ $991.06
306
x 5
_ $1,516,322
3,633
$167.53
1.0000
1.0696
$179.19
$4.25
n/a
$183.44
306
5
$280,663
3,866 1,857
$138.56 $11.49
0.8651 1.0000
1.0391 1.0285
$124.55 $11.82
$5.75 $0.75
n/a n/a
$130.30 $12.57
343 155
5 5
$223,465 $9,742
$2,030,191
$2,068,550
$369,739
$319,785
$13,496
$82,822
$166,884
$3,021,276
$5,051,467
• Historical paid claims are net of stop -loss recoveries and Caremark rebates, and adjusted for historical plan design changes.
• Medical administrative costs include the following fees PEPM: medical ASO fees of $15.95, medical management fees of $3.20, PPO access fees of $5.50.
• Prescription drug administrative costs include fees of $4.25 PEPM.
• Dental plan administrative costs include ASO fees of $5.75 PEPM.
• Vision plan administrative costs include ASO fees of 50.75 PEPM.
• Specific stop -loss premiums (PEPM) are $35.01 for employees and $52.52 for dependent units.
City of Tukwila 2013 Renewal Report
11 10/11/2012
CITY OF TUKWILA
Projected Monthly Funding for the Active Plans
for the Period January 1, 2013 - December 31, 2013
Net adjusted paid claims for the 12 months ending 7/31/2012
Covered employees for the 12 months ending 5/31/2012,
7/31/2012, 6/30/2012, and 6/30/2012, respectively
Claims cost per employee per month
Impact of future plan design changes (if any)
Trend @ 11.0%, 10.0%, 5.6%, and 4.1% for 17 months
Trended claims cost per employee per month with margin
Administrative costs per employee per month
Stop -loss premiums per employee per month (estimated)
Projected composite funding per employee per month
Total composite funding per employee per month
Current composite funding per employee per month
Required increase
Medical Rx Dental Vision
$2,993,204 $608,619 $535,675 $21,336
- 3,627 3,633 3,866 1,857
= $825.26 $167.53 $138.56 $11.49
x 1.0000 1.0000 0.8651 1.0000
x 1.1593 1.1441 1.0798 1.0579
= $956.72 $191.67 $129.43 $12.15
+ $25.22 $4.50 $5.88 $0.77
+ $100.70 n/a n/a n/a
= $1,08 196.17 $135.31 $12.92
$1,278.81 $135.31 $12.92
= $1,005.78 $189.04 $12.00
= 27.1% -28.4% 7.7%
Recommended increase
0.0% 0.0% 0.0%
Notes:
• Historical paid claims are net of stop -loss recoveries and Caremark rebates, adjusted for historical plan design changes.
• Medical administrative costs include the following fees PEPM: medical ASO fees of S16.43, medical management fees of S3.30, PPO access fees of 55.50.
• Prescription drug administrative costs include fees of S4.50 PEPM.
• Dental plan administrative costs include ASO fees of $5.88 PEPM.
• Vision plan administrative costs include ASO fees of S0.77 PEPM.
• Specific stop -loss premiums (PEPM) are estimated to increase by 29.3% to $45.28 for employees and S67.93 for dependent units.
City of Tukwila 2013 Renewal Report
12
Exhibit H
10/11/2012
INCURRED BUT NOT REPORTED CLAIMS ESTIMATES
This section of the report provides IBNR estimates to use in the "Health Self -Insurance Fund: Statement of Revenue Et Expense".
We estimated the incurred but not reported (IBNR) liability as of July 31, 2012 using actuarial methods. Based on the results, as well as a
review of actual run -out, we selected average lag days of 67.5 days, 23.6 days, 31.2 days, and 58.4 days for medical, pharmacy, dental, and
vision, respectively. These are within expected norms. Using average lag days and net adjusted paid claims, we estimated the IBNR liability as
of July 31, 2012. Next, we developed the estimated IBNR liability as of December 31, 2012 by trending the July 31, 2012 estimates to year-end.
We did not add an explicit margin for claims fluctuations because the amount of the reserve in the fund balance is sufficient to cover expected
claim fluctuations. We then added administrative costs. We estimated IBNR liabilities for future periods by applying trend.
Finally, we allocated the liability to actives and LEOFF 1 retirees based on headcount as of July 31, 2012. Exhibit 1 shows IBNR estimates for
active participants.
City of Tukwila 2013 Renewal Report 13 10/11/2012
Exhibit 1
City of Tukwila
Estimated IBNR - Actives
Medical, Rx, Dental, and Vision
Medical Rx Dental Vision
Average claim lag in days 67.5 23.6 31.2 58.4
Divided by the number of days in the 12 months ending 7/31/2012 ÷ 366.00 366.00 366.00 366.00
Portion of year = 0.1844 0.0645 0.0852 0.1596
Net paid claims in the 12 months ending 7/31/2012* x $3,094,544 $805,327 $573,863 $25,417
Unadjusted IBNR = $570,715 $51,928 $48,919 $4,056
Trend adjustment x 1.0444 1.0404 1.0228 1.0167
Exposure adjustment x 0.9860 1.1004 1.1851 0.7035
Estimated IBNR = $587,701 $59,449 $59,296 $2,901
Administrative fees** + $14,983 $4,631 $6,401 $452
Number of actives and retirees as of 7/31/2012 ÷ 343 343 363 195
Number of actives as of 7/31/2012 x 304 304 324 156
Total estimated IBNR as of 12/31/2012, rounded = $535,900 $57,300 $59,300 $2,800
Recommended IBNR as of 12/31/2012, rounded $535,900 $57,300 $59,300 $2,800
Total estimated IBNR as of 12/31/2013, rounded = $594,800 $63,000 $62,600 $2,900
Total estimated IBNR as of 12/31/2014, rounded = $660,200 $69,300 $66,100 $3,000
Total estimated IBNR as of 12/31/2015, rounded = $732,800 $76,200 $69,800 $3,100
Notes:
* Paid claims are net of stop -loss recoveries.
** HMA charges 3 months of administrative fees (excluding PPO access fees) to adjudicate 12 months of run -out claims. This is the basis for the
administrative fees included above. Stop -loss premiums are not included.
Total
$655,300
$655,300
$723,300
$798,600
$881,900
City of Tukwila 2013 Renewal Report 14 10/11/2012
PROJECTED FUND EXPENSES
Exhibit J on the following page provides a statement of revenue and expense for 2012 through 2015. The purpose of this exhibit is to
determine the rate increases necessary to meet the City's financial goal of maintaining reserves at 1 x IBNR for claims fluctuations plus 1.5 x
IBNR for the IBNR liability itself (2.5 x IBNR, in total). The source of each item follows:
• For the first 7 months of 2012, medical/Rx, dental, and vision premiums paid to the fund use actual accruals. For the last 5 months of
2012, premiums paid use enrollment, as shown in Exhibit K, multiplied by the current rates for 2012. For active medical/Rx, we assumed
no change in the HMA rates for 2013, 2014, and 2015. We used actual Group Health premiums for 2013 (a 17.5% increase for regular
employees and a 17.5% increase for LEOFF 1 employees) and assumed a 10.0% increases for 2014 and 2015. We assumed no change in
medical funding rates for 2013 and 2014, and a 27.5% increase in funding rates for 2015. We also applied no increase to the dental and
vision premiums for 2013, 2014, or 2015.
• Medical/Rx, dental, and vision claims and related plan costs use the information shown in Exhibits G and H. We based the claims and
related plan costs for 2013 on the assumed increases shown in the exhibit.
• Employee contributions use enrollment, as shown in Exhibit K, multiplied by the contributions. As we understand it, there are no full-time
employee contributions. However, part-time employees pay contributions, and this exhibit shows estimates of those amounts.
• IBNR uses the estimates developed in Exhibit I.
• COBRA premiums use current enrollment and rates.
• All other fund expenses use the information provided by the City's Finance Department or use the assumed increases shown in the exhibit
(as provided by Finance).
01
City of Tukwila 2013 Renewal Report 15 10/11/2012
CITY OF TUKWILA
Health Self -Insurance Fund 502: Statement of Revenue and Expense - Actives
Accounts
Plan
2013
2014
2015
Medical/ Rx
0.0%
0.0%
27.5%
Funding Rate Changes
Group Health
17.5%
10.0%
10.0%
2014 1
Group Health Li
17.5%
10.0%
10.0%
Dental
0.0%
0.0%
0.0%
City Contributions - HMA
Vision
0.0%
0.0%
0.0%
Accounts
Forecasts
Change
# 'Account Name
2012
1 2013
1 2014
1 2015
2013 1
2014 1
2015
Revenue
1.1
City Contributions - HMA
$4,404,631
$4,450,620
$4,450,620
$5,456,297
1.0%
0.0%
22.6%
1.2
City Contributions - Group Health
$214,040
$251,490
$276,639
$304,303
17.5%
10.0%
10.0%
1.3
Employee Contributions
$28,000
$28,000
$28,000
$35,700
0.0%
0.0%
27.5%
1.4
COBRA Premiums
$22,626
516,709
$16,709
$20,563
-26.2%
0.0%
23.1%
1.4
Interest
5100,000
586,893
573,242
$50,748
-13.1%
-15.7%
-30.7%
Total- Revenue
$4,769,298
$4,833,712
54,845,210
$5,867,611
1.4%
0.2%
21.1%
Expense
Administrative Costs
2.1
ASO, UR, PPO, HIPAA, COBRA
$137,481
$134,777
$141,516
$148,592
-2.0%
5.0%
5.0%
2.2
Stop -Loss Insurance Premiums
$286,010
$369,770
$425,236
$489,021
29.3%
15.0%
15.0%
2.3
Broker and Actuary Fees
$30,400
$30,900
$31,800
$32,800
1.6%
3.0%
3.0%
2.4
City Support Services
$80,305
$73,709
$75,500
$77,765
-8.2%
2.4%
3.0%
2.5
Wellness
$13,421
$18,000
$18,000
$18,000
34.1%
0.0%
0.0%
2.6
Audit
$5,700
$0
$0
$6,700
-100.0%
0.0%
100.0%
2.7
Patient -Centered Outcomes Trust Fees
$0
$888
$1,776
$1,776
100.0%
100.0%
0.0%
Subtotal - Administrative Costs
$553,317
5628,044
$693,828
$774,654
13.5%
10.5%
11.6%
Claim Payments
3.1
Medical/Pharmacy - Claim Payments
$4,071,930
$4,216,889
$4,673,498
$5,179,549
3.6%
10.8%
10.8%
3.2
Dental - Claim Payments
$533,388
$532,734
$562,407
$593,733
-0.1%
5.6%
5.6%
3.3
Vision - Claim Payments
$22,657
$22,599
$23,514
$24,495
-0.3%
4.1%
4.2%
3.4
Group Health Premiums
$214,040
$251,490
$276,639
$304,303
17.5%
10.0%
10.0%
Subtotal - Claim Payments
54,842,015
55,023,712
$5,536,058
$6,102,080
3.8%
10.2%
10.2%
Total - Expense
$5,395,332
$5,651,756
$6,229,886
$6,876,734
4.8%
10.2%
10.4%
Net Total - Fund Income
($626,034)
($818,044)
($1,384,676)
($1,009,123)
30.7%
69.3%
-27.1%
IBNR Funding
4.1
Beginning IBNR Reserve
$430,600
$655,300
$723,300
$798,600
52.2%
10.4%
10.4%
4.2
Ending IBNR Reserve
$655,300
$723,300
$798,600
$881,900
10.4%
10.4%
10.4%
Change in IBNR
($224,700)
(568,000)
(575,300)
($83,300)
-69.7%
10.7%
10.6%
Fund Balance
5.1
Beginning Fund Balance
56,490,580
$5,639,846
$4,753,802
53,293,826
-13.1%
-15.7%
-30.7%
5.2
Ending Fund Balance'
$5,639,846
$4,753,802
$3,293,826
$2,201,403
-15.7%
-30.7%
-33.2%
Target Goal
'Ending Fund Balance = IBNR Reserve I
8.61
6.57
4.12
2.50
Footnotes:
1. Ending Fund Balance = Beginning Fund Balance + Fund Income + Change In IBNR
2. Target Goal = 2.5. One times IBNR for IBNR plus 1.5 times IBNR for contingencies = 2.5 x IBNR
City of Tukwila 2013 Renewal Report
Exhibit J
16 10/11/2012
MONTHLY RATES &t EMPLOYEE CONTRIBUTIONS
Exhibit K provides monthly rates and employee contributions for the health plans for 2012 and 2013 for all employees. There are no full-time
employee contributions.
Enrollment uses July 2012 enrollment by plan and tier provided by the City of Tukwila and HMA. We assumed no change in total enrollment in
2013.
Exhibit L provides COBRA premiums.
01
Co City of Tukwila 2013 Renewal Report 17 10/11/2012
01
Exhibit K
CITY OF TUKWILA
2012 ft 2013 Monthly Rates and Employee Contributions
TOTAL ANNUAL AMOUNT
2012
2013: Based on an 0.0% Medical/Rx Rate Increase, a 0.0% Dental Increase, and a 0.0% Vision Increase
Med/Rx
Enrollment
Dental
Enrollment
Vision
Enrollment
Med / Rx
Dental
Vision
Total
Employee
City
Med/Rx
Enrollment*
Dental
Enrollment*
Vision
Enrollment*
Med / Rx
Dental
Vision
Total
Employee
City
HMA REGULAR
53,657,000
303
n/a
n/a
53,657,000
50
53,657,000
• Dental
n/a
340
n/a
5771,300
$0
$771,300
n/a
340
Employee Only
46
54
24
$419.33
$78.61
$12.00
$509.94
$0.00
$509.94
46
54
24
$419.33
$78.61
$12.00
5509.94
$0.00
$509.94
Employee + Spouse
62
65
32
$883.21
$165.10
$12.00
$1,060.31
$0.00
$1,060.31
62
65
32
$883.21
$165.10
$12.00
$1,060.31
$0.00
$1,060.31
Employee + Spouse + Child
52
54
27
$1,100.40
$212.28
$12.00
$1,324.68
$0.00
$1,324.68
52
54
27
$1,100.40
$212.28
$12.00
$1,324.68
$0.00
$1,324.68
Employee +Spouse + Children
126
128
63
$1,278.25
$251.61
$12.00
$1,541.86
$0.00
$1,541.86
126
128
63
$1,278.25
$251.61
$12.00
$1,541.86
$0.00
$1,541.86
Employee + Child
8
9
4
$636.52
$125.79
$12.00
$774.31
$0.00
$774.31
8
9
4
$636.52
$125.79
$12.00
5774.31
$0.00
$774.31
Employee + Children
9
10
5
$814.37
$165.12
$12.00
$991.49
$0.00
$991.49
9
10
5
$814.37
$165.12
$12.00
$991.49
$0.00
$991.49
HMA LEOFF
Employee Only
0
0
0
$572.41
$78.61
$12.00
$663.02
$0.00
$663.02
0
0
0
$572.41
$78.61
$12.00
5663.02
$0.00
$663.02
Employee + Spouse
0
0
0
$1,036.29
$165.10
$12.00
$1,213.39
$0.00
$1,213.39
0
0
0
$1,036.29
$165.10
$12.00
$1,213.39
$0.00
$1,213.39
Employee + Spouse + Child
0
0
0
$1,253.48
$212.28
$12.00
$1,477.76
$0.00
$1,477.76
0
0
0
$1,253.48
$212.28
$12.00
$1,477.76
$0.00
$1,477.76
Employee + Spouse + Children
0
0
0
$1,431.32
$251.61
$12.00
$1,694.93
$0.00
$1,694.93
0
0
0
$1,431.32
$251.61
$12.00
$1,694.93
$0.00
$1,694.93
Employee + Child
0
0
0
$789.60
$125.79
$12.00
$927.39
50.00
$927.39
0
0
0
$789.60
$125.79
$12.00
$927.39
$0.00
$927.39
Employee + Children
0
0
0
$967.45
$165.12
$12.00
$1,144.57
$0.00
$1,144.57
0
0
0
$967.45
$165.12
$12.00
$1,144.57
$0.00
$1,144.57
GROUP HEALTH REGULAR
0 0 0 0 0 0
Employee Only
9
9
0
$512.43
$78.61
$0.00
$591.04
50.00
$591.04
9
9
5602.09
$78.61
50.00
5680.70
$0.00
$680.70
Employee +Spouse
3
3
0
$1,032.27
$165.10
$0.00
$1,197.37
$0.00
$1,197.37
3
3
$1,212.88
$165.10
$0.00
$1,377.98
$0.00
$1,377.98
Employee + Spouse + Child
4
4
0
$1,296.95
$212.28
$0.00
$1,509.23
$0.00
$1,509.23
4
4
$1,523.87
$212.28
$0.00
$1,736.15
$0.00
$1,736.15
Employee + Spouse + Children
2
2
0
$1,560.97
$251.61
$0.00
$1,812.58
$0.00
$1,812.58
2
2
$1,834.09
$251.61
$0.00
$2,085.70
$0.00
$2,085.70
Employee + Child
1
1
0
$777.09
$125.79
$0.00
$902.88
$0.00
$902.88
1
1
$913.06
$125.79
$0.00
$1,038.85
$0.00
51,038.85
Employee + Children
1
1
0
$1,041.13
$165.12
$0.00
$1,206.25
$0.00
$1,206.25
1
1
$1,223.30
$165.12
$0.00
$1,388.42
$0.00
$1,388.42
GROUP HEALTH LEOFF
Employee Only
0
0
0
$660.03
$78.61
$0.00
$738.64
$0.00
$738.64
0
0
0
$775.54
$78.61
$0.00
$854.15
$0.00
$854.15
Employee +Spouse
0
0
0
$1,179.86
$165.10
$0.00
$1,344.96
$0.00
$1,344.96
0
0
0
$1,386.34
$165.10
$0.00
$1,551.44
$0.00
$1,551.44
Employee + Spouse + Child
0
0
0
$1,444.55
$212.28
$0.00
$1,656.83
$0.00
$1,656.83
0
0
0
51,697.35
$212.28
$0.00
$1,909.63
$0.00
$1,909.63
Employee + Spouse + Children
0
0
0
$1,708.57
$251.61
$0.00
$1,960.18
$0.00
$1,960.18
0
0
0
$2,007.57
$251.61
$0.00
$2,259.18
$0.00
$2,259.18
Employee + Child
0
0
0
$924.69
$125.79
$0.00
$1,050.48
$0.00
$1,050.48
0
0
0
$1,086.51
$125.79
$0.00
$1,212.30
$0.00
$1,212.30
Employee + Children
0
0
0
$1,188.73
$165.12
$0.00
$1,353.85
$0.00
$1,353.85
0
0
0
$1,396.76
$165.12
$0.00
$1,561.88
50.00
$1,561.88
TOTAL ANNUAL AMOUNT
Med/Rx
Dental
Vision
Total
Employee
City
Med/Rx
Dental
Vision
Total
Employee
City
• HMA Medical/Rx
303
n/a
n/a
$3,657,000
$0
53,657,000
303
n/a
n/a
53,657,000
50
53,657,000
• Dental
n/a
340
n/a
5771,300
$0
$771,300
n/a
340
n/a
5771,300
$0
$771,300
• Vision
n/a
n/a
155
$22,320
50
$22,320
n/a
n/a
155
$22,320
50
$22,320
• Group Health Medical/Rx
20
n/a
n/a
5214,040
50
5214,040
20
n/a
n/a
$251,490
50
5251,490
Total
323
340
155
54,664,660
$0
$4,664,660
323
340
155
$4,702,110
$0
$4,702,110
*Based on a projected increase in headcount of 0 employees.
City of Tukwila 2013 Renewal Report 18
10/11/2012
Exhibit L
CITY OF TUKWILA
2012 Et 2013 Monthly COBRA Rates
City of Tukwila 2013 Renewal Report
19
10/11/2012
2012
2013
Med/Rx
Enrollment
Dental
Enrollment
Vision
Enrollment
Med/Rx
Dental
Vision
Total
Med/Rx
Enrollment
Dental
Enrollment
Vision
Enrollment
Med/Rx
Dental
Vision
Total
HMA COBRA REGULAR
0 0 0 0 0 0
0 0 0 0 0 0
0 0 0 0 0 0
Employee Only
0
0
0
$427.72
$80.18
$12.24
$520.14
$427.72
$80.18
$12.24
$520.14
Employee + Spouse
0
0
0
$900.87
$168.40
$12.24
$1,081.51
$900.87
$168.40
$12.24
$1,081.51
Employee + Spouse + Child
0
0
0
$1,122.41
$216.53
$12.24
$1,351.18
$1,122.41
$216.53
$12.24
$1,351.18
Employee + Spouse + Children
0
0
0
$1,303.82
$256.64
$12.24
$1,572.70
$1,303.82
$256.64
$12.24
$1,572.70
Employee + Child
0
0
0
$649.25
$128.31
$12.24
$789.80
$649.25
$128.31
$12.24
$789.80
Employee + Children
0
0
0
$830.66
$168.42
$12.24
$1,011.32
$830.66
$168.42
$12.24
$1,011.32
Spouse Only
2
2
0
$473.15
$88.22
$12.24
$573.61
2
2
0
$473.15
$88.22
$12.24
$573.61
Child Only
1
1
0
$221.53
$48.13
$12.24
$281.90
1
1
0
$221.53
$48.13
$12.24
$281.90
HMA COBRA LEOFF
0 0 0 0 0 0
0 0 0 0 0 0
0 0 0 0 0 0
Employee Only
0
0
0
$583.86
$80.18
$12.24
$676.28
$583.86
$80.18
$12.24
$676.28
Employee + Spouse
0
0
0
$1,057.02
$168.40
$12.24
$1,237.66
$1,057.02
$168.40
$12.24
$1,237.66
Employee + Spouse + Child
0
0
0
$1,278.55
$216.53
$12.24
$1,507.32
$1,278.55
$216.53
$12.24
$1,507.32
Employee + Spouse + Children
0
0
0
$1,459.95
$256.64
$12.24
$1,728.83
$1,459.95
$256.64
$12.24
$1,728.83
Employee + Child
0
0
0
$805.39
$128.31
$12.24
$945.94
$805.39
$128.31
$12.24
$945.94
Employee + Children
0
0
0
$986.80
$168.42
$12.24
$1,167.46
$986.80
$168.42
$12.24
$1,167.46
Spouse Only
0
0
0
$473.16
$88.22
$12.24
$573.62
0
0
0
$473.16
$88.22
$12.24
$573.62
Child Only
0
0
0
$221.53
$48.13
$12.24
$281.90
0
0
0
$221.53
$48.13
$12.24
$281.90
GROUP HEALTH COBRA REGULAR
0 0 0 0 0 0
0 0 0 0 0 0
Employee Only
0
0
0
$522.68
$80.18
$0.00
$602.86
0
$614.13
$80.18
$0.00
$694.31
Employee + Spouse
0
0
0
$1,052.92
$168.40
$0.00
$1,221.32
0
$1,237.14
$168.40
$0.00
$1,405.54
Employee + Spouse + Child
0
0
0
$1,322.89
$216.53
$0.00
$1,539.42
0
$1,554.35
$216.53
$0.00
$1,770.88
Employee + Spouse + Children
0
0
0
$1,592.19
$256.64
$0.00
$1,848.83
0
$1,870.77
$256.64
$0.00
$2,127.41
Employee + Child
0
0
0
$792.63
$128.31
$0.00
$920.94
0
$931.32
$128.31
$0.00
$1,059.63
Employee + Children
0
0
0
$1,061.95
$168.42
$0.00
$1,230.37
0
$1,247.77
$168.42
$0.00
$1,416.19
Spouse Only
0
0
0
$530.24
$88.22
$0.00
$618.46
0
0
0
$623.01
$88.22
$0.00
$711.23
Child Only
0
0
0
$269.95
$48.13
$0.00
$318.08
0
0
0
$317.19
$48.13
$0.00
$365.32
GROUP HEALTH COBRA LEOFF
0 0 0 0 0 0
0 0 0 0 0 0
0 0 0 0 0 0
Employee Only
0
0
0
$673.23
$80.18
$0.00
$753.41
$791.05
$80.18
$0.00
$871.23
Employee + Spouse
0
0
0
$1,203.46
$168.40
$0.00
$1,371.86
$1,414.06
$168.40
$0.00
$1,582.46
Employee + Spouse + Child
0
0
0
$1,473.44
$216.53
$0.00
$1,689.97
$1,731.29
$216.53
$0.00
$1,947.82
Employee + Spouse + Children
0
0
0
$1,742.74
$256.64
$0.00
$1,999.38
$2,047.72
$256.64
$0.00
$2,304.36
Employee + Child
0
0
0
$943.18
$128.31
$0.00
$1,071.49
$1,108.24
$128.31
$0.00
$1,236.55
Employee + Children
0
0
0
$1,212.50
$168.42
$0.00
$1,380.92
$1,424.69
$168.42
$0.00
$1,593.11
Spouse Only
0
0
0
$530.24
$88.22
$0.00
$618.46
0
0
0
$623.01
$88.22
$0.00
$711.23
Child Only
0
0
0
$269.95
$48.13
$0.00
$318.08
0
0
0
$317.19
$48.13
$0.00
$365.32
TOTAL ANNUAL AMOUNT
Med/Rx
Dental
Vision
Total
Med/Rx
Dental
Vision
Total
• HMA Medical/Rx
3
n/a
n/a
$14,014
3
n/a
n/a
$14,014
• Dental
n/a
3
0
$2,695
n/a
3
0
$2,695
• Vision
n/a
n/a
0
$0
n/a
n/a
0
$0
• Group Health Medical/Rx
0
n/a
n/a
$0
0
n/a
n/a
$0
Total
3
3
0
$16,709
3
3
0
$16,709
City of Tukwila 2013 Renewal Report
19
10/11/2012
01
O)
CITY OF TUKWILA
Douglas Evans
R.L. Evans Company, Inc.
ACTIVE EMPLOYEE PLAN
Acct 502
Self-funded medical/Rx, Dental and Vision Program
HMA (subsidiary of Regence) provides administrative services.
Stoploss Insurance purchased through Sun Life (Currently $125K Deductible).
Roger Burton FSA MAAA FCA - Provides annual actuarial review to set funding rates.
Required by WAC.
01
CD
Expenses - 2012 YTD (Sept)
Stop Loss
$216,478
Vision Claims 6%
$16,133
0%
Dental Claims
$398,818
11%
Admin
$165,618
5%
Rx Claims
$456,815
13%
Medical Clams
$2,373,094
65%
502 - Active Employees' Plan
Q)
Medical Claims (PEPM)
$2,500
$2,000
$1,500
$1,000
$500
$0
-Medical Claims
24 mo Trend 20.1%
y
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YTD 2012
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
$257
$671
$561
$875
$2,056
$357
$1,613
$685
$747
502 - Active Employees' Plan
0)
Dental Claims (PEPM)
$300
$250
$200
$150
$100
$50
so
- Dental Claims
- 24 mo Trend 5.6%
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Jan
YTD 2012 $57
Feb
$150
Mar
$116
Apr
$174
May
$250
Jun
$86
Jul Aug
$177 $122
Sep Oct Nov Dec
$114
502 - Active Employees' Plan
Q)
N
Prescription Claims (PEPM)
$350
$300
$250
$200
$150
$100
$50
$0
- Rx Claims
- 24 mo Trend
14.3%
1,
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502 - Active Employees' Plan
Vision Claims (PEPM)
$8
$6
$4
$2
$0
-Vision Claims
24 mo Trend
0.7%
do 'o
tititi'
�o `aJ c, 64eoagc.
,Op>F�titi titi
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502 - Active Employees' Plan
$1,600.00
$1,400.00
$1,200.00
$1,000.00 -
$800.00 -
$600.00
$400.00
$200.00
Premium Fundingvs.
Expense - Historical
(PEPM) - 5 years
.?V.VV
2007
2008
2009
2010
2011
2012 YTD
Vision Claims
$6.00
$5.83
$5.21
$6.11
$5.82
$5.91
Dental Claims
$132.82
$133.08
$140.85
$142.51
$150.81
$138.53
Rx Claims
$158.46
$176.90
$168.53
$159.25
$158.42
$167.21
Medical Claims
$616.22
$620.24
$603.71
$724.15
$666.78
$868.63
SL & Admin
$97.36
$109.36
$106.64
$119.61
$138.24
$139.86
Premium
$1,205.00
$1,332.53
$1,486.33
$1,489.95
$1,201.69
$1,203.27
Premium Funding does not include interest earnings on reserves .
- Vision Claims
- Dental Claims
- Rx Claims
- Medical Claims
- SL & Admin
Premium
502 - Active Employees' Plan
Funding Versus Expenses
Actual
$2,000
$1,800
$1,600
$1,400
$1,200
$1,000
2007 2008 2009 2010 2011 Sep -12
Projected
$2,000
$1,800
$1,600
$1,400
$1,200
$1,000
0)
01
Funding —Actual Expenses
2007 2008 2009 2010 2011 Proj 2012 Proj 2013 Proj 2014 Proj 2015
Funding Expenses
remium Funding does not include interest earnings on reserves.
502 - Active Employees' Plan
$7,000,000
$6,000,000
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$0
Cumulative Reserves
2007
2008
2009
2010
2011
YTD 2012
Reserves
$1,725,219
$2,809,836
$4,549,442
$5,708,894
$6,490,580
$6,274,219
City's Reserve Goal (2.5x)
$1,074,532
$1,190,640
$1,167,751
$1,155,647
$1,076,500
$1,638,250
Reserves include interest earnings. 502 - Active Employees' Plan /
Total Reserves vs. Reserve Goal
Actual
$1,190,640
$1,167,751
$1,155,647
$1,076,500
$1,638,250
$1,808,250 $1,996,500 $2,204,750
502 - Active Employees' Plan /
Total Reserves vs. Reserve Goal
Projected
$7,000,000
$6,000,000
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
$0
Reserves
Cumulative Reserves
2007
$1,725,219
2008
$2,809,836
2009
$4,549,442
2010
$5,708,894
2011
$6,490,580
Proj YE
2012
$5,639,846
Proj 2013
Proj 2014
Proj 2015
$4,753,802 $3,293,826 $2,201,403
City's Reserve Goal (2.5x) $1,074,532
0)
Reserves include interest earnings.
LEOFF 1 RETIREE PLAN
Acct 503
Self-funded: Administration similar to Active Plan.
-City also has liability for non-insured Long Term Care (LTC) Expenses and qualified
expenses not covered under health insurance contract. As members get older, more
likely to incur LTC expenses.
-As members turn 65 (and enroll on Medicare), City's liability for health plan covered
expenses decreases. Currently 30 out of 37 Medicare eligible.
Funding Versus Expenses (LIR)
Actual
$1,500
$1,000
$500
$0
2007 2008 2009 2010 2011 Sep -12
Projected
$1,500
$1,000
$500
$0
Funding —Actual Expenses
2007 2008 2009 2010 2011 Proj 2012 Proj 2013 Proj 2014 Proj 2015
Funding Expenses
Premium Funding does not include interest earnings on reserves .
503- LEOFF 1 Retirees
$2,000,000
$1,800,000
$1,600,000
$1,400,000
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
$0
Reserves
Reserve Goal @ 30%
Cumulative Reserves
2007
$840,700
$129,147
Reserves include interest earnings. 503- LEOFF 1 Retirees /
2008
$1,052,969
$111,024
2009
$1,348,761
$97,401
2010
$1,657,049
$83,117
2011
$1,822,186
$91,005
YTD 2012
$1,877,102
$89,440
O
Plan Reserves -Actual (LIR)
Plan Reserves -Projected (LIR)
$2,000,000
$1,800,000
$1,600,000
$1,400,000
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
$0
Cumulative Reserves
2007
2008
2009
2010
2011
Proj YE 2012
Proj 2013
Proj 2014
Proj 2015
Reserves
$840,700
$1,052,969
$1,348,761
$1,657,049
$1,822,186
$1,896,324
$1,503,899
$1,079,610
$1,079,918
Reserve Goal @ 30%
$129,147
$111,024
$97,401
$83,117
$91,005
$82,800
Reserves include interest earnings.
$88,800
$94,100
$99,700
503- LEOFF 1 Retirees
QUESTIONS
Aucget Wcirk Session C clic/JET 11, 20/2— Pao �I
Diiaisller/Emcirgenciy Prepaireidness
After a leingtty discussion, the Council determined th.al the pclicy surmaunding this plarticulan
item is 1he Caumciil cesine to eaniinuie providing an active anc aplamalianal CE1411 Program. Tlheirei
may have been same canifusion nci: tilling frcim information pIrovic ec in a previaus Budged Work
Session wtereiiri i11 appeared that 1he viah1illy cif de CHRII Tlnainer plosilion for the City was in
jeapardy. However, ttis has beer.i clarified, 1he plasiliar.i is not in jeoplandy, anc the Council
confirmed therm policy plosilion, that it is implanarit anc necessary fcm 'Iter City to provice CERT
lrainin€I olllllanunities anc ami aerlive CERCII program tci 11s rusk curial and t1Lisiness eammunities.
Tlhe Council agreed that it is up to 1he c irecilion af City Admini:lratian how this neec is act ieveid
in ani aplema1lliorial sense.
Ini closing, Irei Council concurred that they are in favor cif samidir.ig items relating to the disciussiar.i, processing
and approval cif 'Ite 2013-2( 4 Biennial Hudgel direcnlly to Cot mil, Bather It an proceieIcing Itrotgh thea
Committee praceis. Accillior.ially, They noted the importance of 1he Strategic Plan findings in nelalion to lhei
iatheis discus seed at ave.
Rewi east for Information
As a nesu It of this Work ession, the C ciunciil neque:led the fallowing:
An aciluarrial replan an the City's Setf-Insunec Hearltcare Plan with informalior.i from lhei pall couple
years , plreIsenl, arid future as appropriate. Infcirmal icin can t e presented v is tt e Finance & Safety
Committee.
• Provide/rile: einil an annual report 10 Council negarc ing the auicamplli: tmerils af tiler Strategic Plan's
TL kwil a IN eight crrhood Cluil neat it Liaisan Progriam.
• Provide a sail ethic! far Department 2( Ital lir is all transfers.
▪ Review anc ciansidem de Summary cif Municipal Rleivenue Sources raft Landed ciut al melding) art the
Finance & Safety Committee.
Handl-Culls Distrihuledl all Welting:
▪ Rei -C alciulalec A ttachmerit A, ler Coz nc it Tileyluesil
• Summary cif Municipal Revem e Sauncies, Draft)
E lummarY, bH KJ M
73