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Home My WebLink AboutItem #3 Health Trust Contributions/ ao", t*- \ CHUBBUCK 1 A A H A To: Council Members From: Scott Gummersall Date: August 31, 2022 Re: Health Plan Funding FY23 Council Members, City of Chubbuck Health Plan Trust 290 E Linden Avenue, Chubbuck, ID 83202 208.239.3279 HR@CityofChubbuck.us The Trustees for the City of Chubbuck Health Plan Trust are requesting Council approval to fund the Health Trust for the plan year beginning October 01, 2022 as presented. The requested contribution is as recommended by the Plan Actuary in the Contribution Certification letter dated August 30, 2022. Council approval should be conditional upon approval of the contribution rates by the Idaho Department of Insurance. Monthly Contribution Rates per the Plan Actuary For the FY23 Plan year, there are no planned changes in deductibles or out-of-pocket maximums paid by the employees and as in the prior year, there is no planned employee participation in the contribution rate. The approved FY23 budget for the City includes a 10% increase in health care contributions to approximately $1,500,000. The financial statements prepared by the Plan Actuary project that annual City contributions for FY23 will be $1,497,940 (Exhibit 5). The 10% increase in the budget for FY23 will cover the recommended 12% increase in contribution rates. This occurs because the Actuary is projecting the increase over projected actual results for FY22 and the 10% increase is comparing the FY22/23 budgets. The Plan Actuary states in the Contribution Certification letter that "...we have determined that the recommended contribution rates are reasonable and provide a margin for adverse experience and all costs of operations. The recommended contribution rates are neither inadequate or excessive nor unfairly discriminatory. They are appropriate for the classes of risk for which they have been computed." Attached with this request are excerpts from the pro -forma financial statements for FY23 prepared by the Plan Actuary. Exhibits 4, 5 and 6 are projections for a worst-case scenario. Using the recommended rates, the Plan Actuary estimates that even in a worst-case scenario, surplus will increase approximately $43,000 (Exhibit 6) by the end of FY23 to approximately $736,000 (Exhibits 4 and 5). The required minimum surplus is projected to be approximately $375,000. The Plan Trustees support this contribution request. Monthly Prior Contribution Monthly ]tate Contribution Effective Percentage Coverage [late 10/4022 Increase Employe -Only 497.72 536.06 11.7': EmplovLu-and 5prnase 949.01 1,O62.34 11.91 nlplcvcr and Children 866.26 969.31 11.91.b Fanulu 1,259.25 1 Al 0.39 12.01.E Overali Nate Increase 12.0'. For the FY23 Plan year, there are no planned changes in deductibles or out-of-pocket maximums paid by the employees and as in the prior year, there is no planned employee participation in the contribution rate. The approved FY23 budget for the City includes a 10% increase in health care contributions to approximately $1,500,000. The financial statements prepared by the Plan Actuary project that annual City contributions for FY23 will be $1,497,940 (Exhibit 5). The 10% increase in the budget for FY23 will cover the recommended 12% increase in contribution rates. This occurs because the Actuary is projecting the increase over projected actual results for FY22 and the 10% increase is comparing the FY22/23 budgets. The Plan Actuary states in the Contribution Certification letter that "...we have determined that the recommended contribution rates are reasonable and provide a margin for adverse experience and all costs of operations. The recommended contribution rates are neither inadequate or excessive nor unfairly discriminatory. They are appropriate for the classes of risk for which they have been computed." Attached with this request are excerpts from the pro -forma financial statements for FY23 prepared by the Plan Actuary. Exhibits 4, 5 and 6 are projections for a worst-case scenario. Using the recommended rates, the Plan Actuary estimates that even in a worst-case scenario, surplus will increase approximately $43,000 (Exhibit 6) by the end of FY23 to approximately $736,000 (Exhibits 4 and 5). The required minimum surplus is projected to be approximately $375,000. The Plan Trustees support this contribution request. Please let me know if you have questions. Thanks, Scott Gummersall I Trustee City of Chubbuck Health Plan Turst 5160 Yellowstone Avenue Chubbuck,ID 83202 Copy: Paul Andrus Rich Morgan Exhlb1t 4 -city of chuhhud self-funded Medical Pla e Proiorr ka Balance Sheet - AggrMate Stop Loan A.ttacll merit Claims Fust City of Ch bbm& Self -Funded Medical Ptin km -22 i111142 Uq.ZP Se 22 • - 2 L Ph"42 dr[,U Lri.23 Fib U Wr,7A hA-2A dance Sheet As seta Cash on hand and on depoat 866,458 .962,175 B57,9L•-: a: -r._ • : 902'44 909.546 9IZ74B 913,449 924-'D7 925.412 933.916 932.624 94.3,429 346.735 951540 - ShormeLrmirnestments - - - - - - - - - - Aocounls Fordngother irreenedmsm, iF hair 0lherinwoued daiets - - - - Srbf561a1 •mh and invested aced AM,450 ?r.' 402,2" 904046 912,746 913,449 92G'kN 325,1112 933,916 938,624 943,429 346,735 953,540 Uncolle,rted ovntributions - - Irrterest andiym meml inoorne dueand b or _• Stop Loan Hen!ivablefrom oarrieF Prepaid E pensts 8n depbtitwith TPA - - - - &theradidii - - - - - - - - - - - - - TorE"Ameb nCL.a50 -9L 2, 657,900 999,355 gt, 902A44 903546 912,746 913,449 924_-D7 325,472 931,818 938,624 943,429 946,735 953,S40 Lib61stillft [Jami urqx%id - Irmarred bbd not reported FIBNA) liability 34,470 95,398 96,356 97,31"_• 39,2{12 10x129 7 ,086 102,017 102rqi3 ]03,872 : 793 ios.758 Imrsas ]0.7 544 1LRL603 Llhe&nld d3ntributi6nt - SW Lbsi PTmmiums Aum but unpSid Clain adnirmhtraiion k"f TPS, feei pAyable - Taues due er atuued - - - 0*erlibba ies 109,984 109,164 ]03,1&1 109,184 789,]&1 IN.-l6d 10; -JM Ji0QL8.4 189,1154 109ri84 ]03,184 1:19.194 109,7194 109rI64 105,184 109,184 TaUllahilties 203,654 2{x4,502 Z05 -S'4 206,493 207,417 208,186 2414333 21ELZ72 211,231 112 37 Z23RM 214983 224,942 215,870 216;020 217,787 Surplus Additiondl SmVuiEdrmbution - - - - dnami ned eerrx (Ioat�sur Fus 562,796 657,533 6S2,364 692,856 668,716 594,459 70D,233 742,476 702.219 708,116 7YJ4957 717,635 723,682 727,%S9 723,905 73%75a TotalSurpfus 562,796 557,533 682,364 692,856 668,716 594,459 70D,2313 742,476 702,219 7auko 7YJ4957 717,635 723,682 727,%S9 729 73%75a Total Uabilitiesand 5 s $66,458 882,175 B57,91V 899,355 896,1+13 902A44 ! m 45 912,746 913,449 92G�DW +125,412 937v616 938,624 943,429 9=1: 963,540 Exhitlil 5 My efChuh6uaSelf-iii rrded Med leal Plea Preferrna W rplas Reeantiliatim s nd Surplus Adequacy - Aggregate Stop Um Attachment Claims Coal City of Chubbw r Self -Funded Med" Plan iWIMI Z lui,22 it 4t&U Marg+~ OM -22 JW -23 Fed -23 for -29 ApP21 Ma •23 Jun -23 Jr1,Z3 Biu •23 Se •23 fleconcillitiDriol Surplus Totel luou!6begimingof period 615,630 662r79& 557593 M.260 592.S56 M86,716 694,459 71G,233 702,176 7(12,21 708,110 711457 717,635 723,682 727,S59 Mi'S06 Total Nmpinf Qbsi) 47.1&7 M2030 F5-23011) 40,496 j1 -4O'• 5,743 5,774 2,243 QS7� 5,991 3,947 5,879 5)47 wit 2-47 5,S47 Total iurpluir end of period 862,795 667,S93 552,30 692,856 589,716 04,459 710,233 703,476 702,219 77$.:1:'. 711,957 717.235 72 .682 727,559 729-15 235,753 Adequacy of 3uwpkit Total wrpluirerrd of period 862,795 667,S93 65Z30 692,850 588,716 MA.im 7-00,233 703,476 702,219 70SAI ti 711,957 717.235 721682 727,559 729-15 735,753 Miinirnurn raVirad irrplus 327,825 327 28 327,626 327,830 371,465 374,485 374AMS 374,465 374,185 374,411E 374,465 374,181 374A..85 374,4115 371,181 374,1.85 Excell (defrtkretlFeserves 334,971 329,768 334,534 365,030 K4,231 .119,974 325,716 327,991 327,731 33 ,625 337,472 343,354 349,196 353,074 355AZ1 381�6g Calculation df Minimum Rrq uirad Surp m (Pian YrM nie&od 1 Aueragernorahlyrcontribution x three 323,836 IMAM nieHrod 2 Aggregate dollar irbprl�--i attachment poirrt 799,952 9183,943 Excess deimi beer ante stop lbsi MUthrnerri point Specific stop Iecsexpbsuffrt rw applicable to bggFe6ate Eitirneted tMal expenses find step loss prem) 4C4,5d0 4S9,1112 Eitirneted t6ntribwbi8ni 1 11 03 1,497,9d� differencegminimrm bf UG%bf differerree Meebd 1 327,836 374A25 OM Exhi il6 {Itk of chuhltuck Self -fu Med Welital plan Proforma InoomeStatement - Aggregate Stop Lass Attachment Claims Cost City efChubbu-kSelf-Funded Medical Plan tori.! Jud -22 ,22 Sop4l att,22 door -22 Doc -22 Jam -2J Fah -23 FdirIn n Ma 23 i1,288 )U 995,233 313,722 Statement aF Inoume 4,00 19,090 119Asq 5IM,0oo. 73,764 S9,W 23,024 52X30 4is50 13,234 205 953 X,234.077 7,455,013 77,226 42947 Operating Rmmnue 4297 Cantributioru from Emplvper 966,iB1 101,79A 102,794 1 7,335 122,132 123,244 123,244 123.144 123.244 1.241654 12-5,363 L26,363 ,3 126,363 126,363 126,353 St6p loss Reomrered - - - - - C�tlher Revenue _ - _ - - Total Operalin$ Rrrsnue SIM= L0k794 10V94 107,533 122,132 123,244 123,14 123,44 123.244 12 654 126,363 121. '' V., 125,363 126,363 126953 Operafln g Fapersee CUMI.Paid 742,043 79908 79,906 78,965 00,232 80878 64,676 84,028 017,878 82,622 B3,063 $3,OL,, B1,061 63,063 23,063 83,053 Snip Loan RoDwmes f 170,065; �Mjsffj - CFran$e in1RNA 14,789 938 959 969 920 959 926 959 959 856 969 928 959 929 959 959 {laimmora 'red 641,967 2WIM 80,651 29,765 81,160 81 37 61,606 61,037 01,237 87,689 64,021 23,99. 84,021 B3,996 84,021 84.021 Stop Lossmverageerpensepaid- specinc 236,962 25,698 25,626 25,384 27,166 21 05 27,385 27,385 27,3M 27,70_ 28,125 21,125 2$,125 2$,125 28,125 28,125 St6pLoesmverageeKpmsepaid -aggregale 1,057 1,357 1,344 I'M 1,505 XiBS 1,585 1-S65 1.4'' 1,599 1,54'9 U99 1,549 7199 1,599 Pharmacy Rebates 05,2501 ri `�1 �ilsaG) •1i,5j [Mwp �Xsco) MSMI [i,S00j P �7.S0: li,swl fi,sCO� �1503� I1, 1 IVqlfflI MDL CL imsa,dministratiomjPA Fees paid 59,507 4,440 4,-040 4.391 4934 4,926 4,926 8,925 4,92{ 4,972 4.972 4.972 4.972 4,972 4972 4972 Managemen1lProFessioml Serwicefeet paid 14,350 2,080 2,090 5,560 11950 2'140 2,140 5,140 8,140 x,1156 4,160 2,160 X,150 4,160 5,560 2'150 iaaG paid 1,578 1,027 1,021 1,016 1,037 110Sf X,-51 1,557 11,.057 X,C6' 1,067 1,06; 1.067 1,062 1,067 14057 ACA- KOM Fee 69 69 SR 69 71 71 71 21 72 7t 72 72 72 72 O*erapelrmting expenses I -I -I -I -I -I -I -I -I - -I - -I -I - - iotal Operalin$ Epenses 939,015 1 113,947 1 114,428 1 67.M7 1 12fi,212 1 111501 I 117,474 I 121001 1 123501 118,164 122,515 1 12005 12Q,516 1 122,885 1 124,016 IM.S 6 8 Q15n (Lossj 47,167 903 5,234 40,495 4y10 5,743 1 5.174 2,243 1 1257015,891 I 3,047 I 6928 I 5.47 I 3AM 1 2.347 5,847 NEtlrnmme 47,16.7 X03 5,234 40,4915 1 Ld�Mpj5,343 1 %774 .2,2431 1257PI5,891 I 3,047 I 5,028 1 5.47 1 3,vlt 1 2,347 5$47 Oct -U to Ck MZ2 to Sept 2Z X,311.303 1,-091,940 X,311,003 "7401 t0 98025 983913 [16�4Z3j - 13AM i1,288 833,436 995,233 313,722 333,159 4,00 19,090 119Asq 5IM,0oo. 73,764 S9,W 23,024 52X30 4is50 13,234 205 953 X,234.077 7,455,013 77,226 42947 77,226 4297 *no