Agency Presentation 2 - FY13 - BOP Saturday, February 11, 2012 10:57 AM FYll Total Compensation Comparison SD and Surrounding States Salary Hou r ly Ave r age Benefits Hourly Average S4500 S40 . 00 - S3500 - - S3000 - - S25 . 00 S2000 S15 . 00 S1000 - - $5. 00 $- SO MT NO WY NE MN IA {$ 1813+$8.03) (S20 07+$9 59) ($22.23+S9.71) (S22 7 3+$11 .72) ($23 62+S1111) (S24 68+$10 98) ($25 91+S13 52) Central States Compensation Association 20 Benefits Hourly Average includes all benefits including health, life, retirement, leave, and more
Salary Policy Recommendations 21
GOVERNOR DAUGAARD'S RECOMMENDATION FOR STATE EMPLOYEE COMPENSATION PACKAGE (page 20, Governor's Budget or page 45 Summary of Governor's Budget) GENERAL FEDERAL OTHER TOTAL FUNDS FUNDS f.!lliQ! FUNDS PACE ADJUSTMENT TO JOB WORTH : $2 , 6S2 ,611 $1 , 886 , 00S $2 ,911, 970 $7 , 450 , S86 The Governor is recommending that the Performance and compensa on Equny (PACE) sy stem eslab h shed 11 FY 1 990 be conllnued to mclude 2 5% adjustments to employees 'MlO are paid under the )Ob-worth of their pa y range T he Governor is al so recommending up to a ma>cimum of 7% adjustment to emplo y ees ,n the Career Banding families establ i shed in FY2010 to move them towards market ACROSS-THE-BOARD INCREASE: The Governor is recommending tnat all permanent s ate employees rece , ve a 3% pay Inc r ease . Executive Branen $3,469,567 $2,998,692 $4,533,660 S11 ,021 ,919 Boa rd o Regents 3,874,735 2,052,622 5,081 956 11 ,009.313 Legisla t ive Branen 121,084 121 ,084 Judicial Branen 3,363 793,976 61 ,131 858.470 Constitutional Offices 255 502 58350 169 566 483 418 Subtotal 18 ,534,864 15 ,113,027 19,846,313 123,494,204 For FY2013. tne employee compensauon pa ckage was distnbuted to agencies In t he Gov ern ors recommended budget 22
FY2012 • 5°/o one time payment not added to the base • Retention • Morale 23
South Dakota State Employee Health Plan 24
FY13 Projected Health Plan Inflation • $8,200,000 total medical inflation • (amount needed FY13) How will this be funded? • $3,300,000 recovered from Plan Administration Changes • $2,400,000 recovered from member contributions thru deductibles and co-pays • $2,500,000 appropriation request • $948,848 in General Funds 25
Health Plan Membership Membership July 2011 Employees 12,524 Retired Employees 556 COBRA 203 Dependents 12,910 Total Enrolled 26,193 Average Age 2011 Plan Member 34 .9 Employee 45.8 26
~ ~ ~ Health Plan Members Health Pl an Enro ll ment ... ~ . s:, "' ......... 20,000 ~- ._ .,v ..._.' ---------------- v __ 18,000 16,000 14,000 12,000 10,000 8,000 · 6,000 - 4,000 · 2,000 a --- - $1 ,000 Pl an $2 ,000 Pl an $300 De ductib le /C opay Plan 27
Service Partners of Health Plan DAKOTACARE Provider ~etwork Cl ums Pro cessing Flexible pending Accounts Express Scripts Prescription l'ietwork Formulary& Maintenance List Sanford Partners in Prevention Health Assessment Annuu HeaJ1h Health Advising creenings Health Coaching Condition ~lanagem ent 28
Claims by Cost Segment - FY11 Paid Paid Claims Claims Paid Claims Paid No Claims Under $1 ,500- $10,000- Claims Submitted $1,500 $9,999 $49,999 $50,000+ Criteria so Claim Dollars $5,721 , 518 524,446,606 $29,594,556 $34,506,328 Percent of Claim Dollars 0.0% 6.1% 25.9% 31 .4% 36.6% Members 5,800 16,178 6,235 1,453 271 Percent of Members 19.4% 54. 0% 20.8% 4.9% 0.9% Claims Cost per Member $0.00 $353.66 $3,920.87 520,362. 90 $127,329.62 Average Claimant Age 31 1 31 9 41 7 47.6 52.1 29
Most Costly Conditions • Forms of chronic Heart Disease • Newborns with complications • Oncology • Degenerative joint disease • Back Conditions • Postoperative infections 30
Cost Drivers • Increasing inflation • Increasing costs of new medical treatments • Increasing costs of specialty pharmacy drugs • Increasing costs of hospital stays • Increasing utilization • Federal mandates 31
FY13 Proposed Administrative Changes Member Impact • Deductible increase from $300 to $500 • Deductible decrease from $2000 to $1800 • Modification of medical and pharmacy plan co- payments Administrative Impact • Case Manager assigned to High Cost Claimants • Management of Emergency Department use at facilities • Pre and post payment claim audits • Direct contracts with providers • Movement to Wellness 32
Comparison of FY11 Employer Contributions with Surrounding States - Health Insurance $14 , 000 $12 , 000 - - ---- $10 , 000 - - $8 , 000 $6 , 000 ---- -- - $4 , 000 -- - $2 , 000 0 South ontana Nath mnescta sxaska Wyoming Iowa Dakota D kota 33 Central States Compensation Association
Health Plan Full Accrual Financial Statement State Employee Self Insured Health P lan Full Accrual Basis Fi nancial Statements FY 2011 FY 2012 FY 2013 Unaudited Estimated Estimated Revenue Contributions 10 Plan $80,337,566 EmplOyer Paid $78,734,012 $78,040, 861 Retiree. COBRA, and Employee Paid ror Dependents $19,224,469 $19,504, 061 $19,504, 061 Federal Ear1)' Retirement Reinsurance Program $973,223 $650,000 Administratil.e Fee $138,725 $145168 S145, 168 $786,699 $600,000 $600,000 Interest Re1enue 51 ,984,528 $2,300.000 $1 .350.000 Rerund of Prior Years Claims To tal Re1enue $ 101 ,841,656 $101 ,240,090 $101,936,795 Expenses $94,574, 971 $91 ,888,080 Claims 591,642.174 Employer Ure Claims $390,000 $550 000 S550,000 Administration $7 ,466,890 $7,733,7 51 $9,460,770 Total Expenses $1 02 , 431 , 861 $99,925.925 $101 .898,850 ($590,205) $1 ,314,165 $37.945 Cunren Year o.er /(Underreco1eiy) Prior Year O\et'/(Underrec01.el)') $665,367 S75, 162 $1 ,389,327 $75,162 $1 ,389.327 S1 427 272 Cumulatil.e 01er/(Unclerreca1eiyr ·cumulam ,e 01er/ (Underreco1e1y) 1s tne analyslS or me revenues and expenses since tile beginning of 1ne program. 34
FY13- Appropriation Request • Appropriation Request - FY13 $2,563,215 • Represents a $200 per employee increase • FY12 rate= $6,135 • FY13 proposed rate= $6,335 General Funds $ 948,848 Federal Funds $ 598,814 Other $1,015,553 $2,563,215 Total 35
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