Paradise Valley Unified School District
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Paradise Valley Unified School District November 1, 2012 PowerPoint PPT Presentation


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Paradise Valley Unified School District November 1, 2012. Discussion Points. Background/Overview Review of Financial Statements Executive Summary of VSIT/VSWCP Annual Report (handout) Services Data (handout). 2. Background/Overview

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Paradise Valley Unified School District November 1, 2012

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Paradise valley unified school district november 1 2012

Paradise Valley Unified School District

November 1, 2012


Paradise valley unified school district november 1 2012

Discussion Points

  • Background/Overview

  • Review of Financial Statements

  • Executive Summary of VSIT/VSWCP Annual Report (handout)

  • Services Data (handout)

2


Paradise valley unified school district november 1 2012

Background/Overview

How are Insurance Services and Products Acquired?

  • Two Methods for Acquiring Insurance

    • Individual school district procurement

    • Join insurance pool and have pool acquire on your behalf

3


Paradise valley unified school district november 1 2012

Background/Overview

Overview of Individual School District Procurement

  • Issue Request For Proposal (“RFP”) for consultant services

  • Hire an Employee Benefits Consultant

  • Put out RFP for providers

  • Review proposals and evaluate

  • Committee review

  • Best and Final negotiations

  • Award contract

  • 3+ months to do

  • Perform above at least every 5 years or when a change of vendors is needed

  • During 5 year award negotiate renewals with only current vendors

4


Paradise valley unified school district november 1 2012

Background/Overview

Overview of Pool (Valley Schools) Procurement Process

  • Solicit proposals from providers

  • Receive and evaluate proposals

  • Award contract

  • Perform the above at least each year

  • 3+ weeks to do (more of less if necessary)

5


Paradise valley unified school district november 1 2012

Background/Overview

Pool Advantages

  • Lower administrative costs for acquisition

  • Reduce administrative work on appeals, claims, documents, legal, vendor management, committee work, etc.

  • Vendor other than current vendor can be negotiated with during annual rate renewals (continuous Best and Final)

  • More negotiating power due to aggregation of members

  • Eliminates formal bid protests and unintended bid rejections

  • Able to enter into longer term relationship

  • Investment Advantages

6


Paradise valley unified school district november 1 2012

Background/Overview

How is Valley Schools different from other Pools/Trusts in Arizona?

  • Surplus Reserves can be used to offset contribution increases, wellness

  • program costs, or any other employee benefit or insurance related expense

  • Autonomy of plan design for all Employee Benefits (i.e. health, dental, life, etc.)

  • Portion of rate for fixed expenses broken out from medical/pharmacy claims

  • expense

  • More transparency of management/administration operations

7


Paradise valley unified school district november 1 2012

Background/Overview

Valley Schools Formation and Governance

  • The Valley Schools Insurance Trust (“VSIT”), Valley Schools Workers’ Compensation Pool (“VSWCP”) and Valley Schools Employee Benefits Trust (“VSEBT”) are public entity pools created by an Intergovernmental Agreement pursuant to A.R.S. §11-952.01

  • The Valley Schools Management Group (“VSMG”) was formed by an Intergovernmental Agreement pursuant to A.R.S. §11-952

  • Annual audit by Certified Public Accountant

  • Monthly/Quarterly financial statements prepared by independent Certified Public Accounting firm

  • Oversight and regular periodic examinations by the Arizona Department of Insurance

  • Governing/Management structure

  • Assets

  • Twenty-three public entity pools in Arizona

8


Paradise valley unified school district november 1 2012

Background/Overview

Valley Schools Operations

  • VSMG fixed management fee is charged to VSIT, VSWCP and VSEBT

  • Management fee allocated to VSIT/VSWCP/VSEBT members

  • VSIT closed to new members; VSWCP and VSEBT open to new members

  • VSEBT is the largest of the eight employee benefits public entity pools in Arizona

  • VSEBT average annual growth:

    • 25% in ADM

    • 57% in members

    • 22% in covered lives

  • VSEBT serves about 25% of all public school district employees

  • VSEBT had 100% retention this year

9


Paradise valley unified school district november 1 2012

Background/Overview

  • How does a school district assure itself on an ongoing

  • basis it is getting the best deal?

10


Paradise valley unified school district november 1 2012

Background/Overview

VSEBT Contribution (Premium) Breakdown

11


Paradise valley unified school district november 1 2012

Background/Overview

What are fixed expenses?

  • Fixed Expenses

    • Medical Claims Administration (TPA)

    • Network Usage

    • Prescription Drug Administration

    • Stop Loss Coverage

    • EAP/Managed Care

    • COBRA Services

12


Paradise valley unified school district november 1 2012

Background/Overview

How do you compare fixed expenses?

  • Compare like programs to accurately

    evaluate fixed expenses

    • Self-Insured

    • School Districts

    • UnitedHealthcare

13


Paradise valley unified school district november 1 2012

Background/Overview

FY 2011/12 VSEBT Fixed Expense Comparison/Annual Savings

District 1 & 2 Average(PEPM)$ 54.32

PVUSD Rate (PEPM)$ 46.42

PEPM Difference$ 7.90

PVUSD Employee CountX 2,811

Total savings on Fixed Expenses$ 266,483

Interest earnings$380,134

TOTAL$ 646,617

  • The above rate include claims administration, network usage, stop loss coverage, EAP/managed care, COBRA administration

  • The above PEPM rates have not been adjusted for differences in stop loss levels or all contractual terms

  • The above do not include dental, vision and life insurance savings

  • The above information was obtained through Public Records Requests

14


Paradise valley unified school district november 1 2012

Review of Financial Statements

Valley Schools Insurance Trust

Valley Schools Workers’ Compensation Pool

Valley Schools Employee Benefits Trust

Valley Schools Management Group

15


Paradise valley unified school district november 1 2012

VSIT Financial Statements

16


Paradise valley unified school district november 1 2012

VSWCP Financial Statements

17


Paradise valley unified school district november 1 2012

VSEBT Financial Statements

18


Paradise valley unified school district november 1 2012

VSMG Financial Statements

19


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