March 28, 2006 1:00 p.m.
The 78th meeting of the State and Public School Life and Health Insurance Board (hereinafter called the Board), met Tuesday, February 28, 2006, at 1:00 p.m. in the EBD Board Room, 501 Woodlane, Suite 500, Little Rock, AR 72201.
Members Present Members Absent
Dr. Joseph Thompson
Sharon Dickerson, Executive Director, Employee Benefits Division.
Connie Diggs, Pat Minyard, George Platt, Eric Gribble, Ashli Davis, Lori Bain, Lora Vocque, EBD; Rhonda Jaster, ACHI/EBD; Patty O’Malley, Mona Neal, PSC; Doris Atkins, ADED, Walt Morrison, College of Pharmacy/EBD; Bryan Meldrum, John Glassford, NovaSys; Mary Kay Braden, AWCC; Martha Borders, Roy Lamm, Mike Steck, QualChoice; Rhonda Rocke, Kathy Jacobson, Dwight Davis, NMHC; Kathy Lavender, AGFC; Don Barnes, AG Office; Dave Redfield, Rose Gantner, John Hill, Don Turner, Corphealth; Barbara Melugin, Kathy Ryan, Ron DeBerry, David Bridges, ABCBS/HA; Kathy Hanlan, Rogers School Dist.; Nicola Patterson, Eddie Fryer, USAble; Charles Hesselbein, AHTD (Ret); Larry Dickerson, AHTD; Frances McElyen, ATRS; Marc Watts, ASEA; Becky Walker, APERS; David Wise, DataPath; Kathy Jacobson, Dwight Davis; NMHC; Mark Helms, Scott Pace, UAMS; Debbie Veach, ACHI.
Call to Order
Meeting was called to order by Preston Means.
Approval of Minutes
The motion was made to approve the minutes of the prior meeting, and seconded by Vance Strange. Minutes approved.
DUEC Report by Dr. William Golden
Celebrex and Mobic (COX-2)
Dr. Golden reported on the committee’s decision to exclude the COX-2 drugs Celebrex and Mobic from the formulary, referring to the controversy concerning the effectiveness, as well as safety. Ms. Dickerson explained that EBD is in the process of implementing an appeals process where a physician will look at a particular application and advise the member if he thinks the drug should be covered. EBD will send out a communication notifying the whole population of this change, which will be effective July 1, 2006.
After comments from several of the Board members a motion was made by Dr. Thompson to accept the recommendation to remove the COX-2 drugs from formulary. Strange seconded. Motion carried.
Elidel and Protopic
Dr. Golden stated there is some concern and they want to make sure the medication is appropriate and monitored. He also mentioned Xopenex, another drug they are keeping their eye on.
Marc Watts ASEA, asked about the appeals process and Ms. Dickerson told him it would be in effect July 1, 2006. There was a great deal of discussion about the appeals process. Watts questioned whether it was actually an appeal process and was assured that it was an appeal process.
PSE Rates, by John Bauerlein (Milliman)
Bauerlein discussed the favorable reserve and how the PSE benefits can be brought to a more comparable level with the ASE rates. He also stated the administration fees are included in these rates. The High Deductible PPO was decreased to $1,250/single. Dickerson stated that the strategy is have the school benefits mirror the state employee benefits, and lowering the high deductible in the HD Plan.
There was a lot of discussion about the need to make the PSE rates comparable to the ASE rates. Joe Musgrove made the motion to accept the proposed rates as presented. Mallory seconded the motion. The motion passed.
Dr. Thompson made a motion that EBD communicate that parity has been achieved between the plans. The motion was seconded by Mallory. Motion approved.
Financialsby Leigh Ann Chrouch
It was pointed out the medical and pharmacy claims in February were lower. Chrouch continued by saying that they did return all payments collected in penalties from the school districts as instructed and are still monitoring those districts with problems. The biggest problem is they are sending the wrong report. That will be addressed again.
Dickerson stated that some of the school districts are still not paying in advance for their insurance premiums. The majority of school districts are relatively small and do not have a lot of money. There are two school districts who do not understand pre-payment and that, too, has been addressed. One is Greenwood and they owe about $80,000 and the other is Wynne and they owe $100,000.
In the case of the Greenwood and Wynne School Districts, they were initially given four months to pay the insurance premium they were behind on. Neither have paid and after talking with the districts I am recommending that we give them six more months to pay the premium.
Watson made the motion that the Wynne and Greenwood School Districts be given 6 months unless there is a fund balance, and send a letter directing them it must be done. The motion was amended to include a written agreement and a payment schedule stating they must have their balance paid within six months and they must return the signed agreement within 30 days. Dr. Thompson seconded. Motion passed.
If the districts did not abide with that they would be asked to attend the next Board meeting and explain why they could not agree to the arrangements. The Board members also stated that if the district has a large reserve that they would be expected to pay the back premium immediately.
Musgrove asked that in the future the financials be emailed to Board members prior to Board Meeting for their review.
Dickerson presented Means with a clock/plaque in appreciation of his dedication and service while serving on the Board. Janis Harrison was appointed as the designee to serve in Means position on the Board by Richard Weiss, the Director of DF&A. Harrison expressed her thanks for the opportunity to serve on the Board and wished Means a happy retirement.
Benefits Sub-Committee, by Janis Harrison
In addition to the PSE rate changes and subsidy the recommendations from the Benefits Sub-Committee are as follows:
approve the Corphealth weight management plan
look at the PSE and ASE HRA and raise the discount from $10 to $20 per member
instead of a tobacco cessation discount that we have a point system discount
Approve PSE rates
The Committee will be looking at these changes on the state employee side as well.
UAMS College of Pharmacy has offered to assist us with our appeals process and prior authorizations. Currently we are paying $20 for Prior Authorizations (PA) and that will go to $15. They will charge $125 per appeal on medication. Harrison stated that it is the recommendation of the Benefits Sub-Committee that the Board approve the move from NMHC to UAMS College of Pharmacy for our PAs and appeals process, which will be developed.
Musgrove made a motion to approve the pre-authorization and appeals process for only the drugs that are not on formulary. Dr. Thompson seconded. Motion carried.
There was more discussion on the appeals process with Dickerson stating that by law if a drug is not covered, there must be an appeals process. It was pointed out there has not been an appeals process in place, and it is important for our members to have a formal appeals process, but this appeal process does not include a financial appeal. Means would prefer this process be referred back to the Benefits Committee and for them to come back to the Board with a recommendation. It was clarified that this would be strictly for drugs that are not on formulary. All were in favor of this action.
McCook made a motion to adopt the weight management plan by Corphealth. The motion was seconded by Mallory. Motion approved.
The meeting continued with Geurtsen discussing the self-administration feasibility report. Dickerson stated that the plan is to create ARHealth, then execute case management, offering full customer service. She also stated they would produce on-site one card for both pharmacy and medical. All of this is projected with the full support of the carriers.
Preston interjected that the hardest part of self-administration is for state government to recruit and retain employees from the competitive market. He continued by saying it will be a slow and methodic process and what Ms. Dickerson is recommending is a cost-effective plan.
McCook gave his support for EBD to generate the cards and feels they are capable of doing case management. He feels this is as far as we need to move at this time.
McCook made the motion that the Board support and authorize Dickerson to do whatever is needed to implement this program of self-administration. The motion was seconded by Watson. Motion carried.
EBD will put together information on penalties assessed to the carriers and bring back to the next meeting for discussion.
Dickerson stated that due to the controversy surrounding the penalties assessed the school districts she was instructed by her boss to return the monies collected in penalties. That was done.
Dickerson asked for the same parity for retiree’s dependents, giving the same benefits so we can pool all retirees together. McCook seconded. Motion passed.