April 21, 2020 Presentation1. Health Insurance Premium Stability and predictability target medical trend 3% to 6% annually 2. Public Schools and Political subdivisions control with

April 21, 2020 Presentation

North Dakota Public

Health Insurance Trust

NDIRF-SEEC Partnership-Brennan Quintus

SEEC and Hays Trust Program OverviewEvaluation ProcessResources and Next Steps

++

Brennan Quintus, CEO

North Dakota Insurance Reserve Fund (NDIRF)

In surveys, members are asking about:

• Property Insurance

• Health Insurance

NDIRF works with virtually all political subdivisions in North Dakota:

The “umbrella” to help local governments get the buying power of a

large group.

Partnering with consulting firms that specialize in health insurance in

North Dakota.

Who are the REA’s and SEEC

Kyle Davison

Executive Director

Who We Are

The Hays Difference | 5The Hays Difference | 5

▪ Hays Companies was founded in 1994

▪ Became part of the Brown & Brown Team in 2018

▪ Full-service insurance brokerage consultancy specializing in:

▪ Employee Benefits

▪ Property & Casualty

▪ Risk Management

▪ Retirement Planning

▪ All-inclusive resources and national leverage with the speed

and agility of a smaller broker

▪ Transform benefits and risk through modern technology and

industry expertise

▪ Creative. Data-Driven. Strategic. Consultants.

The past 10 years, the Hays’ Risk

Pool Management client groups have

experienced a 4% market rate renewal

trend for their health plan premiums as

compared to the market in the same

period at 8.2%

The Hays NDPHIT Service Team

NATIONAL RESOURCES

Dave Ross

Executive VP

of Underwriting

Ben Graves

Executive Director

Steve Piccolino, MBA

Vice President National

Benefits Technology

Heather Kopnicky

Health Strategist

Frank Bacon

Pharmacy

Consultant

Nicholas Karls

Associate Director

Josh Rydberg

Senior Underwriting

ConsultantFinancial

Strategies

Compliance

& Legislation

Wellness

Technology

Pharmacy

Rich Scherer

Vice President

International Benefits

Amy Peterson

Senior Analyst

International

Benefits

Louise J. Short, MD, MSc

National Clinical Leader

Strategic Benefit Advisors

Greg Rucinski RPh

Executive VP

PillarRx Consulting, LLC

Catherine Hobbs

Director of Software

Implementation

Megan Karis

Marketing Director

Olena Zhuravlova

Benefit Analyst

Elizabeth McArthur

Financial ConsultantJon Heath

Benefits Consultant

Stephanie Mace

Lead Consultant

Randy Johnson

Strategic Consultant

The Hays Difference | 6

North Dakota Employer Clients

The Hays Difference | 2 Proprietary and Confidential Work Product

Strategic Approach to Health Plan Management

One solution will not mitigate rising health plan costs.

In addition to our proven Risk Pool Management

(RPM) strategy, Hays analyzes your data, evaluates

multiple strategies and develops custom solutions.

Audit

Analyze your data

Diagnose

Understand the results

Execute

Implement strategies

Assess

Measure impact

RPM

Population Health Strategies

Well-Being Management

Pharmacy Saving Solutions

Surgery & Physician Networks

Catastrophic Claim Management

On-Site & Near Site Clinics

Direct Provider Contracting

Accountable Care Organizations

Stop-Loss Cooperatives

Medicare Transition Solutions


History of Success

The Hays Client Management Process:

▪ Our focus is using Tools, Resources and Strategies to manage risk

▪ In-depth of Professional Expertise and Competencies

▪ Consulting and Advising vs. traditional Broker transactional product pricing

▪ Consistency of Planning and Analysis

▪ Forward Thinking and Strategic Initiatives

▪ A broad and expert level of HR, Legal Compliance, Actuarial/Underwriting,

Clinical and Risk Management Resources

▪ Dedicated Service Team

▪ Detailed Execution


ND Public Health Insurance Trust Objectives

The primary function of the NDPHIT is to provide benefit programs and services

within the scope of a (“VEBA”) Trust which could include but not limited to:

1. Health Insurance Premium Stability and predictability target medical trend 3% to

6% annually

2. Public Schools and Political subdivisions control with local, regional and state-wide

representation

3. A benefit to Political subdivisions fully-insured and potentially self-insured groups.

4. Access to both additional and better HR Administration Services, Employee

Benefit Communications and Transparent Cost Reporting

5. More Health Plan Choices

6. In addition to Medical Insurance

-Dental and Vision Insurance

-Life Insurance

-Disability Insurance

-Voluntary benefits

-or other programs permissible and determined by the board of Trustees

FAQ: Public Health Insurance Trust Opportunities

FAQ: How will this affect my plan current health insurance benefits?

FAQ: How is the program structured?

ND Public Health Insurance Trust

Board of Trustees

School District A

School District-B

School

District C

School

District D

School Teacher Bargaining Rep

NDIRF

Representative

Non-School

Political Subdivision

Non-School

Political Subdivision

Non-School Political

Subdivision

Fiscal Agent

Trust Board of Trustees Structure

Following the initial establishment of the Trust, a nine-member Board of Trustees of participating schools, which will be

comprised of the following:

Four (4) Superintendent Trustees, which shall be the superintendent or the superintendent's designee for intervals of 1, 2

and 3 year terms, and will be entitled to appoint a Trustee to serve on the Trust based upon its relative size to the other

Participating Employers.

One (1) Trustee shall be the representative of a teacher bargaining unit for a 2 year term;

One (1) Trustee shall be a member of the North Dakota Insurance Reserve Fund;

Three (3) Trustees shall be a member Non-School Political Subdivisions or Designee for 2 and 3 year terms.

All Trustees shall be afforded one (1) vote

Other Trust Participation Agreement Terms

Other Trust Participation Agreement Terms

Adult Preventative Care

▪ Alcohol misuse screening and counseling

▪ Blood pressure screening

▪ Cholesterol screening for adults of certain ages or at higher risk

▪ Colorectal cancer screening for adults 50 to 75

▪ Depression screening

▪ Diabetes (Type 2) screening for adults 40 to 70 years who are overweight or obese

▪ Diet and obesity counseling for adults at higher risk for chronic disease

▪ Hepatitis B screening

▪ Hepatitis C screening for adults at increased risk

▪ HIV screening for everyone ages 15 to 65

▪ Immunization vaccines for adults

▪ Urinary tract or other infection screening

▪ Breast cancer mammography screenings

▪ Osteoporosis screening

▪ Well-woman visits

Children Preventative Care

ACA Covered Preventative Care-No Member Cost Share

▪ Autism screening for children at 18 and 24 months

▪ Behavioral assessments for children ages: 0 to 11 months, 1 to

4 years, 5 to 10 years, 11 to 14 years, 15 to 17 years

▪ Bilirubin concentration screening for newborns

▪ Blood screening for newborns

▪ Depression screening for adolescents beginning at age 12

▪ Developmental screening for children under age 3

▪ Fluoride varnish for all infants and children as soon as teeth are

present

▪ Gonorrhea preventive medication for the eyes of all newborns

▪ Hearing screening for all newborns; and for children once

between 11 and 14 years, once between 15 and 17 years

▪ Hematocrit or hemoglobin screening for all children

▪ Hemoglobinopathies or sickle cell screening for newborns

▪ Hepatitis B screening

▪ HIV screening for adolescents at higher risk

▪ Hypothyroidism screening for newborns

▪ Immunization vaccines for children from birth to age 18Iron

supplements for children ages 6 to 12 months at risk for anemia

▪ Lead screening

▪ Obesity screening and counseling

Political Subdivisions for a July

snd January 2021 Renewal

▪ We need a letter of authorization for your groups claims data and plan benefits now through May 15

▪ Individual Employer Determination and Underwriting. May 15 to June 15

▪ Groups Renewal Health Plan Strategies. June 15 to July 1

▪ Renewal Decisions by August 15

▪ Open Enrollment Preparation and Communications September 15

▪ Open Enrollment October through November 30

Schools October 2020-21Renewals

▪ We have 34 schools letters of authorization, claims data and are interested to participate in the medical plan in 2021

▪ Additional schools we need authorization letters now for the medical (NDPERS, Sanford or BCBSND) for 2021. April through May 2020

▪ Review information for the Trust Dental, Vision and Voluntary programs for October 2020

▪ Dental, Vision and Voluntary Individual Employer Determination and Underwriting. June 1 through July 15

▪ Open Enrollment Preparation and Communications July 15 through August 1

▪ Open Enrollment August 1 through August 31st, 2020

NDPHIT Trust Timeline

Initial Schools

and

NDPHIT for proposed Underwriting Model

34 Schools used for Final Underwriting

Barnes County North

Cavalier School District

Central Regional Education Assoc. (CREA)

Ellendale Public School

ENL Public School (Elgin/New Leipzig)

Grafton Public School

Hankinson Public School

Hillsboro Public School

Kenmare School District

Kidder County Public School District

Kindred School District

LaMoure Public School

Litchville / Marion

Mapleton Public School

McKenzie County-Watford City

Medina

Midway

Milnor School

Montpelier Public School

New Rockford-Sheyenne

North Border School Dist.

North Sargent

Oakes Public School

Oliver Mercer Special Ed

Rugby School District

Rural Cass Special Education Unit

Scranton Public Schools

South East Ed Coop

Thompson Public School

Underwood Public School

Wyndmere

Initial School Underwriting Model

Underwriting Parameters:▪ The current school health plan benefits with expanded preventative care services

with no cost sharing▪ Current enrollment and 2019-2020 premium▪ Up to 24 months of historical enrollment and claims though1-31-2020▪ Adjusted for claims over 175K▪ Removed individuals not covered as of January 31, 2020▪ Funding claims through September 30, 2021 with a 6.85% trend (26 months) ▪ Annual Trust Premium Assumes No premium increase for participating Trust

Members for October 2020 through September 2021▪ The annual expected premium is $13,203,105 for 34 schools▪ The model accumulates a monthly surplus over expected claims of $74,765 or

$898,589 in year one▪ BCBSND requires 2 months of claims and first October premium by September 30▪ Assumes each school contributes 7.5% of their annual premium as an initial deposit▪ Final underwriting will be determined by participating schools – could be less than

34 schools.

NDPHITHow is the HealthPlan Managed?

16

What Drives Health Insurance Premium Increases?

Plan Design does not drive Health Care Cost increases

-High Cost Claimants Drive Cost

Offering unaligned Multiple Plans can Create Adverse

Selection-Healthy members select lower cost plans

Rates Tier Factors are generally not set correctly

according to enrolled Age/Sex demographics

Unaligned Employer Contributions by Tiers

can understate required budget revenue

Behavior economics and plan member choices are

most often misaligned and almost never considered by

employers (Cost vs. Value)

These factors can cause

employer health plan

increases 3% to 10% annually

Risk Pool Management – Think Differently

The Hays Difference | Proprietary and Confidential Work Product

How to control health insurance premium increases?


Population Health Strategies

Well-Being Management

Pharmacy Saving Solutions

Surgery & Physician Networks

Catastrophic Claim Management

On-Site & Near Site Clinics

Direct Provider Contracting

Accountable Care Organizations

Stop-Loss Cooperatives

Medicare Transition Solutions

Self-Funded vs. Fully Insured


Partially Self-Funded Plan Fully Insured Plan

Cost Components of Self-Funding and Fully Insured Plans

Pooling/Commission

Terminal Lag

Risk Margin (Profit)

State Tax

Claims

Stop Loss or Pooling Charge

Admin

5-12%

4%

3%

3%

1.75%-3%

3% to 5%

2% to 4%

Savings

Range and varies by State

Reinsurance-Stop Loss


▪ Aggregate Reinsurance – Pool Level

▪ 20% Corridor- BCBSND

Health Care Expenditures for High Cost Cases using data from the Society of Actuaries

175K Stop Loss Example


NDPHIT Reinsurer's Target Loss Ratio – $175,000 Deductible

2018 High Case Analysis Tool Analysis Period – 1/1/2018 through 12/31/2018

Specific Deductible $175,000

Maximum Specific Reimbursement $2,000,000

Membership 2,260

Network and/or Demographic Adjustment 1.0600

Specific Stop Loss Premium $1,367,233

Expected Liability between $175,000 and $2 Million $751,542

Reinsurer's Overhead (Admin, Reserves, Taxes, Profit, etc.) $615,691

Reinsurer's Estimated Target-Loss-Ratio 55.0%

Specific

Deductible

Projected

Members/1000 in

Excess of

Deductible for a

Normal Population

Expected

Members in

Excess of

Deductible

Expected Members

between the

Deductible and the

Incrementally Lower

Deductible

Midpoint between

the Deductible and

the Incrementally

Lower Deductible

Additional Liability

between the

Deductible and the

Incrementally Lower

Deductible

Expected Additional Liability

between the Deductible and

the Incrementally Lower

Deductible for Members that

Exceeded the Deductible

Expected Additional Liability

from Members between the

Deductible and the

Incrementally Lower

Deductible

Total Expected Liability

$25,000 32.350869 77.499742

$30,000 25.844008 61.911906

$35,000 21.211804 50.814997

$40,000 17.819469 42.688319

$45,000 15.263028 36.564110

$50,000 13.261636 31.769575

$55,000 11.550102 27.669425

$60,000 10.337759 24.765136

$65,000 9.275426 22.220210

$70,000 8.258862 19.784931

$75,000 7.619765 18.253909

$80,000 6.956512 16.665021

$85,000 6.408184 15.351447

$90,000 5.911275 14.161051

$95,000 5.450743 13.057801

$100,000 4.984950 11.941947

$105,000 4.716573 11.299023

$110,000 4.352603 10.427095

$115,000 4.105559 9.835276

$120,000 3.886811 9.311245

$125,000 3.556121 8.519044

$130,000 3.353479 8.033595

$135,000 3.109720 7.449646

$140,000 2.945366 7.055919

$145,000 2.759702 6.611141

$150,000 2.581582 6.184438

$155,000 2.409403 5.771965

$160,000 2.269105 5.435867

$165,000 2.173431 5.206672

$170,000 2.060783 4.936811

$175,000 1.954770 4.682846

$180,000 1.840617 4.409382 0.2735 $177,452 $2,452 $22,047 $671 $22,717

Comparisons Self-funded Schools


Grand Forks Jamestown Dickinson Wahpeton Wahpeton

Program Cost Details Public Schools* Public Schools* Public Schools*

Health Insurance Program $1,000 Deductible $250 Deductible $500 Deductible $2,700 Deductible $2,800 Deductible

Plan Year 6 Year Average 6 Year Average 6 Year Average 2019 2020-21

Trust Trend Calculation(IBNR+Medical Trend)

Per Employee Per Year Cost

Number of Covered Employees 854 255 359 133 134

Number of Covered Lives(EE's/Dependents) 1960 663 955 303 305

Premium Budget Per Employee Per Year 11,825$ 13,415$ 13,474$ 14,653$ 13,394$

Annual Premium Increase 5.3% 4.0% 5.1% -2.5% -8.6%

Administration, Stop Loss and Medical Costs PEPM PEPM PEPM PEPM

BCBSND Administration Costs 37$ 78$ 67$ 60$ 60$

Trust Management Costs

Stop Loss 126$ 209$ 166$ 426$ 426$

Total Administration + Stop Loss Cost 163$ 287$ 233$ 486$ 486$

Medical/Rx Cost Per Employee Per Month 761$ 756$ 873$ 545$ 615$

Total 924$ 1,043$ 1,106$ 1,031$ 1,101$

Acutal Medical Trend 1.2% 1.9% 4.9% -36.8% -8.6%

Actual Annual Cost 11,092$ 12,516$ 13,270$ 13,394$

Loss Ratio 94% 93% 98% 91%

Claims Trend – 3 Public Self-funded Schools


Jamestown Public Schools Medical/Rx Claims

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

Monthly Claims with Trend Line

Claims PEPM Budget PEPM Linear (Claims PEPM) Linear (Budget PEPM)

1.9%

4.9%

-2.7%

Grand Forks Medical/Rx Claims Totals

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

Monthly Claims with Trend Line

Claims PEPM Budget PEPM Linear (Claims PEPM) Linear (Budget PEPM)

Example 2020-21 Renewal- Grand Forks Public Schools Medica ACO


Grand Forks Public Schools Method 1 Method 2 Method 3

Preliminary Underwriting

for 2020/2021 Plan year

Rolling 12 - 60 day

lives setback Rolling 12 Current Year

Paid Paid Paid

Claims 3/1/19 - 2/29/20 3/1/19 - 2/29/20 9/1/19-2/29/20

Enrollment 1/1/19 -12/31/19 3/1/19 - 2/29/20 9/1/19-02/29/20

Enrollment 10,326 10,337 5,241

Medical Claims 6,796,162$ 6,796,162$ 3,255,599$

Medical Claims (ACO)

Rx Claims 1,600,636$ 1,600,636$ 443,819$

Claims over stoploss deductible (556,754)$ (556,754)$ (37,925)$

Total Claims 7,840,044$ 7,840,044$ 3,661,493$

Medical PEPM 604.24$ 603.60$ 613.94$

Medical Trend 6.80% 6.80% 6.80%

Months trend 18 18 18

Effective Trend 1.1071 1.1071 1.1071

Rx PEPM 155.01$ 154.85$ 84.68$

Rx Trend 7.10% 7.10% 7.10%

Months trend 18 18 18

Effective Trend 1.1120 1.1120 1.1120

Claims plus Trend

Medical/Rx 841.31$ 840.42$ 773.84$

Admin Fees

Admin Fee (Medical/RX) 1

33.65$ 33.65$ 33.65$

Stop Loss 2

150.45$ 150.45$ 150.45$

PPACA fees 0.46$ 0.46$ 0.46$

Total Admin 184.56$ 184.56$ 184.56$

2020/2021 Accrual Rate Medical/Rx 1,025.87$ 1,024.97$ 958.40$

2019/2020 Accrual Rate Medical/Rx 1,093.59$ 1,093.59$ 1,093.59$

% Increase from 2019 to 2020 -6.2% -6.3% -12.4%

Reduction of 12.4%

1.472 Million Savings

Monthly FinancialReportsExamples

16

Meaningful Reporting and Analytics

Health Plan Intelligence (HPI)

Monthly Reporting


Monthly Reporting


Monthly Reporting


Financials


Employee CommunicationResources

Communications Strategy

40

Acc

ess

you

r em

plo

yee

ben

efit

s an

ytim

e, a

nyw

her

e!

Hays Companies offers Mobile Benefits Solutions to provide your employees with 24/7 access to employee benefit information from any mobile device. The app is designed to help employees easily use and better

understand their benefits, saving both the member and company valuable time and money.

o Benefits & Coverage Informationo General Medical ID Cardso Benefit Forms & Documentso Educational Videoso Provider Directorieso Service Contact Informationo Wellness Planso Accessible on Mobile, Tablet, &

Desktopo Customized, Branded Design

KEY APP FEATURES

No, when you access the website address for the app with your mobile device, you will be automatically directed to the mobile app. The app is a web app, which means there is nothing to download, no need to access an app store, etc...it’s ready for use when you access the site address from your device!

But, what if I want an “app-like” icon on my home screen? You can add an icon to your Home Screen by clicking the Add to Home Screen icon when you are on the app’s home page. Now it will work just like any other app!

Do I have to download an app to use it?

Mobile CompatibilityiOS (iPhone/iPad), Android, and Windows

Mobile App

dickinson.mybenefitsapp.com

dickinson.mybenefitsapp.com

https://dickinson.mybenefitsapp.com/

Breaking Through to Employees With Text

Sources: Trumpia, Dynmark, TextMarks, MarketingCharts, Pure360

People

are

more likely to respond to

a text than an email

they

do so

more than an

average email

of people read a text

within 15 minutes

of receiving it

open

rateSMS texts

have a

1

Company Perks

Making Better Choices

Student debt & loan repayment

Tuition reimbursement

401k plan

Notifications

Set up your telemedicine account

Where to go for care

ER vs Urgent Care

Pharmacy, mail order

Deadlines

Open Enrollment

Announcements And MORE!

Custom Communications

43

bswift – Benefits Administration

Our EBTech team evaluates and matches a qualified benefits

administration solution that best meets the needs of your organization and

employees. Our teams are made up of experienced professionals who will

both implement the technology platform and provide ongoing support.

Online Benefits

EnrollmentHRIS

HR, Benefits, Payroll (stand

alone or integrated)

Employee Self-Service

(mobile and web)

Time and

Attendance

Decision Support

Technology

TECHNOLOGY SUPPORT TOOLS OUTCOMES

▪ Enhance Employee Experience

▪ Ease Administrative Hassle

▪ Improve ACA Compliance

▪ Simplify Open Enrollment

▪ Accurate Eligibility and Carrier

Feeds

SERVICES

▪ Conduct Needs Analysis

▪ Prepare Vendor Comparison

▪ Negotiate Prices

▪ Manage Demos

▪ Support Vendor Selection

▪ Oversee Implementation

Other Benefits:DentalVisionLifeDisabilityVoluntary Benefits

Empowering HR and Organizations

45

Next Steps

▪ Group Level-Letter of Access - Advisor Appointment by each political subdivision– Gather your claims data from the carriers

– Obtain all benefit programs (medical, dental, voluntary, etc) currently in place

– Provide a summary analysis of findings and options

– Develop a renewal time-line for each group

▪ Trust Level-– Form Trust Board May 2020

– File Trust to State to cover scope of Medical, Dental and Vision services

– Trust Program Benefits October 2020 and January 2021

– Confirmation of Groups to finalize Trust participation agreements we will contact groups individually

– Launch Schools in October

– NDIRF Groups in 2021

[email protected]

Jon HeathBenefit Consultant(801) 505-6506Hays Companies of Utah

Randall Johnson | Senior Vice PresidentEmail: [email protected]: (801) 505-6481 | Mobile: (801) 505-8974 | Fax: (801) 505-6501Hays of Utah Insurance Services201 South Main StreetSuite 2100 | Salt Lake City | UT | 84111A Brown and Brown Company