Joint Insurance Committee

THE CITY OF OKLAHOMA CITY JOINT INSURANCE COMMITTEE Joanna McSpadden Isaac Locke Anne Lapuzza Donna Skidmore Larry Slaff Phil Smith By The City of Oklahoma City Office of the City Clerk at 11:17 am, May 28, 2024 420 W Main Ste 110, Oklahoma City, OK 73102 Basement Conference Room June 5, 2024 8:30 a.m. It is the policy of the City to ensure that communications with participants and members of the public with disabilities are as effective as communications with others. Anyone with a disability who requires an accommodation, a modification of policies or procedures, or an auxiliary aid or service in order to participate in this meeting should contact the ADA Personnel Department Coordinator at 297-2861 or TDD 297-2020 as soon as possible but not later than 48 hours (not including weekends or holidays) before the scheduled meeting. The department will give primary consideration to the choice of auxiliary aid or service requested by the individual with disability. If you need an alternate format of the agenda or any information provided at said meeting, please contact the ADA department coordinator listed above 48 hours prior to the scheduled meeting.  CITY OF OKLAHOMA CITY JOINT INSURANCE COMMITTEE AGENDA and MEETING NOTICE DATE: June 5, 2024 TIME: 8:30 a.m. PLACE: 420 W Main Ste 110, Oklahoma City, OK 73102 Basement Conference Room AGENDA: I. Call to Order II. Approval of Minutes A. March 6, 2024 III. Information from Vendors IV. Information from Employee Benefits Division A. Plan Performance  AGENDA ITEM II. Approval of March 6, 2024 Minutes  CITY OF OKLAHOMA CITY JOINT INSURANCE COMMITTEE MINUTES March 6, 2023 The Joint Insurance Committee meeting was held on December 6, 2023 at 8:30 a.m. in the City Municipal Building, 420 W Main, Ste 110 Basement Large Conference Room Those in attendance were: Members Present: Larry Slaff, Citizen Member Donna Skidmore, Retiree Member Isaac Locke, AFSCME Representative Anne Lapuzza, FOP Lodge 123 Member Phil Smith, Citizen Member Members Absent: Joanna McSpadden, City Manager Designee Staff Present: Jason Long, Total Rewards Manager Richard Mahoney, Ass Municipal Counselor III Wendi Carter, Benefits Coordinator I. Call to Order Jason Long, called to order the Joint Insurance Committee Meeting at 8:33 AM II. Approval of Minutes The minutes of the March 6, 2024 meeting was approved with no objection.  III. Information From Vendors IV. Information from Employee Benefits Division Lockton presented 2023 year end financials and plan performance Review minutes from previous meeting Motion to approve minutes- Isaac Locke Second- Richard Mahoney Mr. Long asked if there were any question - none were asked. Mr. Locke AFSME representative stated there were no complaints or issues at this time. Ms. Young reviewed plan performance materials. Ms. Young indicated HMO running at 96% loss ratio through 12/2023 and moving forward with the EPO and PPO plans with BCBS. Ms. Young noted the goal was to hit 95% per Jason Long Mr. Long shared both plans have performed better than medical inflation. Mr. Long stated the 2024 claims side would show more details at the June meeting. Ms. Lupuzza asked if employees AFSME employees can move from the EPO plan to the PPO plan. Mr. Long noted that AFSME is with EPO only. Ms. Young shared RFP and noted no person was on. Mr. Long stated this is the first year to be fully funded at the City of OKC. Mr. Long stated the city clinic has a new physician on staff in January and that this should address the employees concern over the turnover of employees at the clinic. Ms. Young stated that reporting is at a much deeper level with the vendor BCBS. Mr. Slaff asked if we have a demographic on male and female active and retiree members. the slides were consulted and discussed. Mr. Mahoney stated if there was a way to include costs from the Premise Health Center would be helpful.  Mr. Mahoney inquires about new dental plan options. Mr. Long note City is looking into future options. Mr. Long notes the premium will remain the same for 2024. Ms. Young notes RFP for stop loss will change due to significant claimants on the plan (including EPO participants). Ms. Young notes RFP for Medical Center will be deployed in early 2024. Mr. Long reviews open enrollment for 2024 plan year was the first self service with an on site venue at the City Convention Center. Mr. Long noted of employees on the HMO plan only 125 remained which were processed as passive enrollment to the EPO plan. Mr. Long noted additional changes for 2024 include pension system changes with Police. They will no longer provide payment on behalf of their retirees. Of those participants, 80% signed up for new billing options with 170 that have not responded. V. Citizens to be heard VI. Items from Committee Members VII. Adjournment Mr. Long adjourned the meeting at 9:06 A.M.  AGENDA ITEM III. Information from Vendors  AGENDA ITEM IV. Information From Employee Benefits Division A. Plan Performance JOINT INSURANCE COMMITTEE AGENDA June 5, 2024 • Plan Performance / Utilization • Pharmacy Program Opportunity • Dental Benchmarking LOCKTON COMPANIES | 1 Plan Performance Data through March 2024 Executive Summary – Active Employees On an all-plans combined basis; the plan is running at 77.5% loss ratio (funding vs. expenses). The Active EPO plan is running with YTD expenses to budget/accrual ratios of 74.2% while the PPO Plan is running at 81.7%. Keep in mind that the EPO Plan does not have any run-in claims, so it’s typical for the loss ratio to be lower. Projected Per Employee Per Month (PEPY) cost is $3,431 (in March 2023, it was $4,481). This reduction is primarily due to moving away from the fully insured HMO. The City did not have to pay run out on that plan and claims on the new EPO plan are beginning to ramp up beginning in March. Enrollment increased 3% from the prior plan year. Plan had 10 claimants over $100k year to date, no claimants were more than the $300k stop loss level. 3 3 Performance Overview - Actives Budget Summary Gross Budget vs. Gross Plan Costs Year to Date Loss Ratio $9,000,000 2023 PY 2023 PYTD 2024 PYTD Gross Budget vs. Plan Costs $8,000,000 Avg # Employees 4,774 4,719 4,852 $7,000,000 *Total Paid Amount $87,608,993 $21,145,785 $16,646,014 $6,000,000 *Budget Amount $89,139,698 $22,172,294 $21,479,208 Loss Ratio 98.3% 95.4% 77.5% $5,000,000 Total Paid Claims PEPY $18,352 $4,481 $3,431 $4,000,000 $3,000,000 *Total Paid and Budget Amount includes paid claims, stop loss and other adjustments, administration fees, and stop loss premium. $2,000,000 **Total Paid PEPY is based on year to date net claims and fixed costs and enrollment is set back 1 month to reflect average claim lag. $1,000,000 $0 77.5% Gross Budget Gross Plan Costs Year to Date Gross Plan Cost Detail Average Enrollment EE Only EE + Spouse EE + Child EE+Children EE + Family Prior YTD Current YTD 6000 Employee Only 1,913 2,030 5000 45% Employee + Spouse 1,104 1,069 1198 1212 4000 Net Medical Claims Employee + Child(ren) 266 293 250 55% 239 266 293 3000 Net Pharmacy Claims Employee + Child(ren) 239 250 1104 1069 2000 Employee + Family 1,198 1,212 1000 1913 2030 Total 4,720 4,854 0 Prior YTD Current YTD Net Paid Claims: Monthly PEPY Year to Date Medical/Rx Claims over $100,000 $20,000 $1,362,941 $18,000 8% $16,000 $14,000 Prior PEPY $12,000 Current PEPY $16,629,068 $10,000 92% $8,000 $6,000 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 4 4 Paid claims over $100,000 All other paid claims  Rolling 12 Month Trend Analysis - Actives $25,000 $23,000 Cost Per Enrolled Employee - Rolling 12 Months $21,000 $18,641 $18,561 $18,411 $18,155 $18,383 $18,296 $18,349 $18,310 $18,374 $17,778 $17,609 $17,329 $19,000 $17,000 $15,000 $13,000 $11,000 Paid Claims Month Net Claims + Fixed Cost #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0! #DIV/0!… 5 5 Retiree Financials Estimated Cumulative Cumulative Monthly Cumulative Enrolled Premium Stop Loss Month EE EE+S EE+CH EE-CHs EE+F Employee Premium Admin Cost Net Claims (1) Total Plan Costs Total Plan Funded Funded Employees Equivalents Premium Contributions Equivalents Costs Loss Ratio Loss Ratio Jan-24 664 512 31 10 36 1,253 $719,632 $1,740,886 $1,740,886 -$170,707 $61,037 $1,607,095 $1,497,425 $1,497,425 86.0% 86.0% Feb-24 663 511 32 10 36 1,252 $717,990 $1,737,782 $3,478,668 -$170,573 $60,990 $1,466,424 $1,356,841 $2,854,266 78.1% 82.1% Mar-24 665 512 32 10 37 1,256 $716,708 $1,736,353 $5,215,022 -$171,078 $61,156 $1,792,148 $1,682,226 $3,039,067 96.9% 58.3% Apr-24 May-24 Jun-24 Jul-24 Aug-24 Sep-24 Oct-24 Nov-24 Dec-24 YTD 1,992 1,535 95 30 109 3,761 2,154,330 5,215,022 -512,358 183,183 4,865,667 4,536,492 87.0% • 51% of claims are attributed to pharmacy / 49% to medical • In 2024, 3 claimants are over $100k • In 2023, 3 of the 7 stop loss claimants were retirees Pharmacy Program Opportunity  Flex Access – Program for Consideration Overview • The FlexAccess Program unlocks access to copay assistance programs across multiple dispensing channels, including retail. • Plan spend is reduced by leveraging the full value of manufacturer coupon assistance. • For members, the FlexAccess Program replaces their existing coupon program but can also work with a current assistance program that members are enrolled in. • The Flex Access Team makes outreach to eligible members prompting them to enroll into the FlexAccess benefit so they can receive discounted copays. Members may also opt-in by calling a designated phone number. All Savings are estimates based on prior utilization and future results may vary. Utilizer Count is based on number of members-products prospectively in Flex Access Program. The Flex Access drug list is subject to change based on the availability of manufacture assistance programs. Data includes paid claims date range 4/1/2023 – 3/31/2024. LOCKTON COMPANIES | 8 Dental Benchmarking / Opportunities Dental Benchmarking Overview Plan Topic • The City of Oklahoma City’s Annual Maximum ($1,500) dental offerings in most cases High Plan Ortho Maximum ($1,200) exceed industry benchmark. Deductible ($50 / $150) • Benchmark is Clients of similar Employee Share of Premium size and industry based on Annual Maximum ($1,000) Lockton’s book of business. Low Plan Ortho Maximum ($1,000) Deductible ($50 / $150) Employee Share of Premium Better than benchmarks Worse than benchmarks LOCKTON COMPANIES | 10 Edge Benchmarking Results Dental deductible 100% 90% 80% 73% 70% 60% 60% 50% 40% 27% 30% 20% 20% 7% 7% 7% 10% 0% 0% 0% 0% 0% 0% Individual Deductible Family Deductible $0 $1-$50 $51-$100 $101-$200 $201-$300 $301+ Dental plan maximum 100% 90% 80% 70% 58% 60% 60% 50% 40% 40% 30% 25% 20% 8% 8% 10% 0% 0% 0% 0% 0% 0% 0% Plan Maximum Ortho Plan Maximum $0-$500 $501-$1000 $1,001-$2,000 $2,001-$2,500 $2,501-$3,000 $3,001+ LOCKTON COMPANIES | 11 Independence changes everything. © 2022 Lockton Companies. All rights reserved.