From
Lisa Norris, Human Resources Director
Title
Insurance Fund Monthly Review
Presenter
Lisa Norris, Human Resources Director
Recommended Action
Review Only
Analysis
This analysis covers the experience in the Employee Insurance Fund through May 2018:
Employee Insurance Fund (Attachment 1):
April closed and both active claims (row 32) and retiree claims (row 33) continue to fall well beneath both the Fiscal Year Monthly Claim Average (column 10) and the Running 12-month Claim Average (column 11). Active claims reached only $823,843 in April and retiree claims hit at $151,887 for the month. As for the running projections (blue column 14), we continue to use the worst case monthly projection to anticipate costs for the remaining five months in the fiscal year, highlighted in red in column 11, rows 32 and 33 for both actives and retirees. Even utilizing those high numbers for remaining months, our active claims projection is anticipated to only reach $13,954,725 (column 14, row 32) - about 96% of our budgeted $14.6 million, and retirees are running about the same percentage beneath budget and projected to only reach $2,874,711. This helps to anticipate an operating balance of $3,067,017 (column 14, row 41) at fiscal year-end. If we achieve this positive year-end operating balance, we typically consider withholding a city-contribution from actives and deposit into the Risk Fund to continue building stoploss reserves. Rather than do that, it reamins my recommendation to rebuild the depleted Contingency Reserve in this fund back to $2 million (or higher) for future difficult years and leave the ending resource balance as is beyond that. Also, we typically reimburse ourselves from the Risk Fund for any claims in excess of $400,000 that were paid in the prior plan year from January - December 2017. At this time, since our operating balance is expected to be strong in the Insurance Fund, I would not recommend further depletion of the Risk Fund ...
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