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Budget Update. January 15, 2014. Budget Calendar. General Fund. ten Year analysis. Enrollment History. Source: Matanuska-Susitna Borough School District Comprehensive Annual Financial Reports. Straight Line Growth Rate Total Salaries & Benefits Per Pupil* (FY2002-03 Base Year).

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Presentation Transcript
Budget update

Budget Update

January 15, 2014



Ten year analysis

General Fund

ten Year analysis


Enrollment history
Enrollment History

Source: Matanuska-Susitna Borough School District Comprehensive Annual Financial Reports


Straight line growth rate total salaries benefits per pupil fy2002 03 base year
Straight Line Growth Rate Total Salaries & Benefits Per Pupil*(FY2002-03 Base Year)

*Employee Benefits does not include the on-behalf contributions for TRS & PERS, which began in 2008

Source: Alaska Department of Labor & Workforce Development and Matanuska-Susitna Borough School District Comprehensive Annual Financial Reports


Straight line growth rate comparison certificated salaries per pupil fy2002 03 base year
Straight Line Growth Rate ComparisonCertificated Salaries Per Pupil(FY2002-03 Base Year)

Source: Alaska Department of Labor & Workforce Development and Matanuska-Susitna Borough School District Comprehensive Annual Financial Reports


Straight line growth rate comparison non certificated salaries per pupil fy2002 03 base year
Straight Line Growth Rate ComparisonNon-Certificated Salaries Per Pupil(FY2002-03 Base Year)

Source: Alaska Department of Labor & Workforce Development and Matanuska-Susitna Borough School District Comprehensive Annual Financial Reports


Straight line growth rate comparison employee benefits per pupil fy2002 03 base year
Straight Line Growth Rate ComparisonEmployee Benefits Per Pupil*(FY2002-03 Base Year)

*Employee Benefits does not include the on-behalf contributions for TRS & PERS, which began in 2008

Source: Alaska Department of Labor & Workforce Development and Matanuska-Susitna Borough School District Comprehensive Annual Financial Reports


Health insurance
Health Insurance

  • The total Health Premium has risen steadily since 2003 with an overall increase of almost 160%

  • Through bargaining however, the District has set a priority to attempt to maintain these increases and our costs have increased about 133%

Source: Matanuska-Susitna Borough School District Department of Human Resources


Longterm forecast

Financing the Future

Longterm forecast


Revenue assumptions
Revenue Assumptions

  • Borough Revenue continues to INCREASE at 3%

  • Federal Revenue Maintains with ZERO INCREASE or DECREASE

  • State Energy Relief Funding continues at $100 per Adjusted ADM

  • Student Safety and Security Grant ends after FY14

  • ZERO INCREASE or DECREASE in the State Foundation Formula

  • Intensive Count maintains at 321 students

  • Other Local Receipts maintains with ZERO INCREASE or DECREASE


Expense assumptions
Expense Assumptions

  • Certificated Salaries are maintained with an average annual step INCREASE of 1.8%

  • Non-Certificated Salaries are maintained with an average annual step INCREASE of 3.2%

  • Health and Life insurance INCREASE at an annual rate of 8% with the INCREASE split 50/50 between employee's and the District (Overall INCREASE to District costs equal 4%)

  • All other deduction factors are maintained with any INCREASE due to INCREASE in Salary factors

  • Utilities INCREASE at an annual rate of 10%

  • Insurance Bonds & Premiums INCREASE at an annual rate of 1.5%

  • Indirect rate is maintained at 5.58% annually and amounts are based on Grant projections included in the FY14 Budget Book

  • All other Non-Personnel accounts are maintained with ZERO INCREASE or DECREASE




Structural deficit
Structural Deficit

Structural Deficit


Hay group study

State Managed Group Health Insurance Program for Alaska Public School Employees

Hay Group Study


Purpose
Purpose Public School Employees

  • Conduct and provide an analysis of the current health benefit plans for each of the 53 school districts in Alaska.

  • Establish an actuarial value of the various benefit plans offered

  • Estimate the projected premiums and costs of consolidating public school employees in Alaska under a state-managed plan


Hay groups study
Hay Groups Study Public School Employees

  • Surveyed all 53 school districts – 100% participation

  • NEA Alaska Health Plan

  • Aetna, Premera, TPAs

  • Dept. of Administration

  • Dept. of Education and Early Development

  • Unions – Teamsters, Local 71


Health insurance in alaska s school districts
Health Public School EmployeesInsurance in Alaska’s School Districts

  • Enrollment by district size

  • There are approximately 19,000 employees total, 17% opt out of coverage


Health insurance in alaska s school districts1
Health Insurance in Alaska’s School Districts Public School Employees

  • Costs by district size


Health insurance in alaska s school districts2
Health Insurance in Alaska’s School Districts Public School Employees

  • Plan offerings currently available in Alaska’s school districts


Health insurance in alaska s school districts3
Health Insurance in Alaska’s School Districts Public School Employees

  • 21 district’s have 0% employee cost share

  • 32 district’s have some cost share the average being 13%

  • Public sector national average is 15%


Health plan cost drivers
Health Plan Cost Drivers Public School Employees

  • Three key drivers of a plan’s costs

    • The extent to which plan pays for the costs of care.

    • The utilization of those benefits by plan members.

    • The non-benefit costs that are required to administer the plan.


Plan costs broken down
Plan Costs Broken Down Public School Employees

  • The argument for self insurance/pooling


Saving through pooling
Saving through Pooling Public School Employees

Cost savings for a consolidated pool can be broken down to four main areas

  • Provider Networks

  • Overhead

  • Plan Design

  • Cost Sharing


Consolidation outcomes
Consolidation Outcomes Public School Employees


Options
Options Public School Employees

  • Optimize Program Performance

  • Leverage AlaskaCare Plans

  • Centrally Managed School District Program with Standard Health Plan Options and Cost Sharing

  • Centrally Manage School District Program with Standard Health Plan Options Only

  • Bring all School District Plans under State management


1 optimize program performance
1. Optimize Program Performance Public School Employees

  • Savings achieved through provider networks and overhead $17.1M - $28.8M


2 leverage alaskacare
2 Public School Employees. Leverage AlaskaCare

  • Consolidate all health care coverage under the existing AlaskaCare plans increase of $8.7M – savings of $34.9M


3 district pool with standard plan and cost share
3. District Pool with Standard Plan and Cost Share Public School Employees

  • Provides an independent pool for school districts with three standard plan options and a standard cost share savings of $22.6M – $33.7M


4 district pool with standard plan
4. District Pool with Standard Plan Public School Employees

  • Provides an independent pool for school districts with three standard plan options $9.4M – $64.9M


Recommendations
Recommendations Public School Employees

  • State pursue pooling as described in option 3

    • Significant savings through optimization of plan performance, plan design consolidation and standardized cost sharing.

  • To achieve maximum benefit and savings the transition would need to be mandatory


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