Public Safety Employees Association Health and Welfare Trust

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Public Safety Employees Association Health and
Welfare Trust

• April 2009

Wes Yoder, Trust Consultant
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General Information

• Sponsored by the Public Safety Employees
  Association of Alaska (PSEA)
• Governed by a Board of Trustees elected by PSEA
  members participating in the Trust
• Current participants include
• Alaska State Troopers
• Airport Police and Fire Officers
• Juneau Police Department
• Fairbanks Police and Fire Departments
• Trust website http//www.pseahealth.org
• Health benefits purchased through Premera Blue
  Cross Blue Shield of Alaska
• Trust administered by Labor Trust Services,
  Anchorage, AK

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Eligibility and Benefits

• To be eligible for benefits, an employee must
• Be a regular and active employee of an employer
  participating in the Trust
• Regularly work a minimum of 25 hours per week if
  salaried or 20 hours per week if part-time
• Have the required contribution made by their
  employer and received by the Trust
• Eligibility is on a family basis. All eligible
  dependents are covered when the employee becomes
  eligible
• Eligible dependents include
• Legal spouse or same-sex domestic partner
• Natural or adopted children under age 25 who are
  unmarried and primarily dependent upon the
  employee for support

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Eligibility and Benefits

• Medical, prescription drug, dental and vision
  benefits provided by Premera Blue Cross Blue
  Shield of Alaska
• Business travel accident insurance provided
  through CIGNA
• Death benefit provided by the Trust

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Benefit Summary
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Benefit Summary
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Benefit Summary
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Trust Funding and Administration

• Trust is funded by employer and member
  (participant) contributions.
• Total required contribution rate established each
  July by the Board of Trustees.
• Current required monthly contribution rate
  (effective July 1, 2008) is 1,117 per
  participant per month.
• Total contributions remitted monthly by each
  employer to the Trust administrator, Labor Trust
  Services, Inc. (LTS).
• LTS forwards eligibility and premiums to insurers
  and provides COBRA administration for the Trust.

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Historical Expenses

• Over the last five years, Trust expenses have
  increased 10 annually.
• Currently over 97 of expenses are used for
  purchasing benefits, with less than 3 of
  expenses attributed to Trust operations.

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Historical Income vs. Expenses

• Over the last several years, expenses have
  outpaced income.
• For the current policy period (July 2008 June
  2009) the Trust is expected to deficit spend
  approximately 350,000 (47 per participant per
  month).

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Historical Assets

• Net assets available for benefits have declined.
  As of November 30, 2008, the Trust had
  approximately 2.4 million in net assets. This
  represents approximately 3.4 months of current
  projected expenses.

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Historical Claims Utilization

• Claims have increased significantly during the
  current contract period.
• The Trust is 100 experience rated. Each year
  Premera sets the Trusts premium rates based on
  the Trusts own historical utilization

hcgb\pseawa\reports\2009\trust report
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Projection for July 2009 June 2010 Contract
Period

• Based on projected premium increases at July 1,
  2009, a significant deficit is projected for the
  upcoming contract period (approximately 217
  PPPM).
• The projected deficit will need to be offset by
  the following
• Increases in employer contributions (varies by
  employer)
• Increases in participant contributions
• Benefit changes to reduce premium costs

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Options

• The Trustees value your input
• Each year the Trustees have to balance the cost
  of benefits with the available contributions.
• If benefits remain at current levels, significant
  increases in participant contributions will be
  required.
• Increases in participant contributions can be
  lessened with benefit changes. Examples include
• 300 deductible/80 coverage/2000 OOP max 40
  per month
• 500 deductible/70 coverage/3000 OOP max 100
  per month
• Rx - 8 generic copay/20 brand copay 6.50 per
  month
• The Trustees will continue to review strategies
  to control costs over the long term.

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What Can You Do?

• Being a smart health care consumer can help lower
  costs.
• Use generic prescriptions when possible
• Currently 65 of prescriptions received by Trust
  participants are generic.
• On average, brand name drugs can cost three to
  five times more than generic drugs.
• If you are currently taking a brand name drug,
  ask your doctor or pharmacist if there is a
  generic drug that would work.
• Use a Premera preferred provider when available
• Preferred providers have agreed to discounted
  fees as payment in full for their services.
• Preferred providers cannot balance bill you for
  amounts above the agreed upon fee.
• During 2008, medical preferred provider discounts
  for the Trust totaled 1.3 million (approximately
  174 per participant per month).
• Remember to update your enrollment data with the
  Trust office (LTS) whenever you have a change in
  dependent status (i.e. marriage, divorce, birth,
  child attaining age 25).

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Other Information

• Current PSEA Health and Welfare Trustees
• Rob Cox Alaska State Troopers, PSEA President
• Chip Gallagher Airport Police and Fire
• Mo Hughes Alaska State Troopers
• Tim Schoenberg Alaska State Troopers
• David Wrightson Juneau Police Department
• Robert Thompson Fairbanks Police Department
• PSEA Trust Administrative Office (LTS) Contact
  Information
• P.O. Box 93870
• Anchorage, AK 99509
• 3380 C Street, Suite 107
• Anchorage, AK 99503
• Local ...........................................
  ....... [phone]
• Toll Free........................................
  ... 1-800-325-6532
• Premera Customer Service (Claims Questions) -
  1-800-508-4722

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Questions?
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