WASC MEETING MINUTES – MAY 1, 2015
May 1, 2015
The meeting was called to order at 9:03 A.M.
General Announcements:


Staff Picnic will be held Wednesday, June 10. There will be raffles
This year Jonah Safris, Service Committee Chair, will be conducting a food drive at the
picnic of non-perishable food items, which will be donated to a local food pantry. More
details to follow as we get closer to the date.
Treasurer’s Report: Opening budget $5,800 Expenditures to date: $298.49, Encumbrances:
$100.00 Balance: $5,401.51
Guest Speaker: Matt Renna, Associate Vice President, Human Resources
Compensation and Benefits
The mission: Maintain financially sustainable benefit programs that allow Pace University
to attract and retain our faculty and staff, while providing quality options that meet
their needs.
Pace Benefits – At a Glance
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WASC MEETING MINUTES – MAY 1, 2015
Historical Medical Plan Renewal – 2004 to Present
Pace Healthcare Cost 2004 to 2015
20.0%
15.0%
13.7%14.7%
16.7%
16.5%
12.7%
Percentage
Change
10.0%
5.0%
16.7%
11.7%
5.3%
2.97%
0.0%
-5.0%
4.8%
3.0%
-3.1%
Year
Healthcare Expense
Renewal Strategy
Strategic Plan
- Review vendor & funding arrangements – no change
- Implement plan design changes that impact employee behavior,
minimize disruption and reduce the projected 2018 Cadillac Tax
- Cadillac tax is forcing paradigm shift from high-premium/low
point of service to premium stabilization/higher point of
service costs.
- Continue & increase wellness initiatives
- University wide dialogue on healthcare
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WASC MEETING MINUTES – MAY 1, 2015
- Presentations/discussion at NYC and PLV campus and Law School for both
faculty and staff councils
Affordable Care Act Update - 2018 - Excise Tax - “Cadillac Tax”





40% nondeductible tax on the annual value of health plan costs > $10,200 for single
coverage or $27,500 for family coverage
Not a question of “if” the tax will impact Pace, but “how much” – 3 out of 5 health
plan already over the threshold
Potential Impact to Pace in 2018 as several plans already exceed the thresholds:
Average Renewal Rate
(2014-2018)
Estimated Annual Excise
Tax (million)
10%
4.2
7%
2.9
5%
2.0
2.5%
1.0
Estimated to
be 6% increase
to plan cost
Keep renewals as low as possible – each year below the average has a future
impact
Make plan design changes that promote positive employee behavior and keep up
with inflation/medical trend
2018 - Excise Tax - “Cadillac Tax” Example
90/70 Plan – Current Cost for Family Coverage
Employee
Annual
Contribution
Pace
Annual
Contribution
Total
Cost
(EE + ER)
Projected Cost
in 2018 based
on 5% increase
(a)
(b)
(c) =
(a)+(b)
(d) = (c)*1.05
$12,096
$19,966
$32,062
$37,116
3
Threshold
in 2018
Amount
over
Threshold
40% Tax
(e)
(f) = (d)(e)
(g) = (f)x40%
$27,500
$9,616
$3,846
This tax is per enrolled
employee in 3this
| P plan
a g ewith
this coverage
WASC MEETING MINUTES – MAY 1, 2015
Medical & Dental Plan Renewal

Renewal in the single digits for third consecutive year (2.97%)


Plan changes include:

$5 copayment increase to all plans (medical/pharmacy)

Increase in Pharmacy deductible from $100/$300 to $125/$375

Increase in Out of Network Deductible from $1,000/$2,000 to

$1,200/$2,400

Freeze 100/70 Plan after July 1st
Rebrand Plan Remaining Three Plans:
 “Consumer Core HDHP”, “Network Core $25” and Network Choice
90/70”
Without changes, renewal would have been 6.39%

2018 Cadillac Tax

Driving Paradigm shift from high premium/low point of service to premium
stabilization/sensitivity and higher point of service costs

Dental – premium reduction on PPO (6%); increase to DHMO (4.69%)

Vision – no increase
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WASC MEETING MINUTES – MAY 1, 2015
Family
Employee plus one
Employee
2014-2015
2015-2016 @ 2.97%
Difference
Employee
(Per Payroll)
Employee
(Annual)
Employee
(Per Payroll)
Employee
(Annual)
Employee
(Per Payroll)
Employee
(Annual)
HSA
$20.97
$503.28
$21.59
$518.23
$0.62
$14.95
InNet $50
$35.12
$842.88
$36.16
$867.91
$1.04
$25.03
InNet $20
$59.19
$1,420.56
$60.95
$1,462.75
$1.76
$42.19
90/70
$84.06
$2,017.44
$86.56
$2,077.36
$2.50
$59.92
100/70
$177.02
$4,248.48
$182.28
$4,374.66
$5.26
$126.18
HSA
$175.23
$4,205.52
$180.43
$4,330.42
$5.20
$124.90
InNet $50
$205.12
$4,922.88
$211.21
$5,069.09
$6.09
$146.21
InNet $20
$263.37
$6,320.88
$271.19
$6,508.61
$7.82
$187.73
90/70
$327.29
$7,854.96
$337.01
$8,088.25
$9.72
$233.29
100/70
$508.34
$12,200.16
$523.44
$12,562.50
$15.10
$362.34
HSA
$262.85
$6,308.40
$270.66
$6,495.76
$7.81
$187.36
InNet $50
$306.81
$7,363.44
$315.92
$7,582.13
$9.11
$218.69
InNet $20
$393.91
$9,453.84
$405.61
$9,734.62
$11.70
$280.78
90/70
$489.48
$11,747.52
$504.02
$12,096.42
$14.54
$348.90
100/70
$760.05
$18,241.20
$782.62
$18,782.96
$22.57
$541.76
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WASC MEETING MINUTES – MAY 1, 2015
Open Enrollment

Thursday May 7th through Thursday May 28th

Flexible Spending participation requires re-enrollment

HR Open Enrollment Website:

http://www.pace.edu/human-resources/open-enrollment-3
Wellness Initiatives
•
Smoking Cessation Events
•
•
•
Continuation of Preventive Care Incentive Program
•
Up to $240 for qualifying exams
•
Increase year over year in well visits
“Wellness Wednesdays”
•
•
Promotions/discounts on featured healthy meals every Wednesday across
all University cafeterias for faculty, staff and students
Free on-campus Flu Shots
•
•
Smoking cessation awareness and education
Also available for free at a variety of retail locations
CIGNA Healthy Pregnancy/Healthy Babies program
•
$150 first trimester; $75 for second
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WASC MEETING MINUTES – MAY 1, 2015
Post-Retirement Plan Modification
•
In 2020, integrate the post-retirement health plan (available only to those hired
before October, 2000) with Medicare Part D, the federal prescription drug plan
administered by private insurance companies.
•
Legislative change taking full effect in the 2020 to close “donut hole”
•
–
Medicare Part D to pay significant portion of retiree prescription coverage
–
Combination of Federal funding & pharmaceutical company brand
discounts
$1,200 per year annual Pace subsidy (indexed 3% per year)
•
Financial impact:
•
FY15: Liability reduced ~$23M (impacts Unrestricted Net Assets)
•
Cash savings starting in year 2020
Please refer to Appendixes A-D for more information on Pace Post-Retirement Benefits,
Medicare Part D and Expected Retiree Costs in 2020
Appendix A: Summary of Post Retirement Plan Provisions
Pre 1996 Hires
Age plus a minimum of 10 years of full-time service must total 75 years in order to be
considered a qualified retiree. Qualified Retirees are eligible for the following benefits:
The University will provide supplemental coverage for our retirees. Medicare coverage
will become primary (if age 65 or over) while University coverage will become
secondary. The retiree is required to contribute towards medical coverage for oneself
while in retirement. The retiree’s contribution will be the same cost share dollar amount
as immediately prior to retirement without being subject to future increases in premium.
If a retiree desires coverage for a spouse, he/she may do so by continuing family
coverage and paying the required premiums.
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WASC MEETING MINUTES – MAY 1, 2015
Medicare - Part B
The University will reimburse qualified retirees, age 65 or over, for the standard monthly
Medicare Part B premium upon receipt of the Medicare Part B card. In 2015, the
standard monthly Part B premium is $104.90.
Life Insurance
Non-Contributory Life Insurance is provided to qualified retirees at an amount equal to
their last full time base annual salary up to $100,000. The amount of the policy will
decrease by 10% of the original amount on the first of each July following the date
of retirement. It will continue to decrease until the amount is equal to 40% of the original
amount, or $2,500, whichever is greater
Appendix A: Summary of Post Retirement Plan Provisions
January 1, 1996 through October 1, 2000 Hires
For employees hired on or after January 1, 1996, age plus a minimum of 15 years of fulltime service must total 75 years in order to be considered a qualified retiree.
Medical Coverage
The University provides supplemental coverage for qualified retirees. Medicare
coverage will become primary (if age 65 or over) while University coverage will
become secondary. The retiree is required to contribute towards medical coverage for
oneself while in retirement. The retiree’s contribution will be based on the schedule
below:
Full-Time Service
Employee Contribution
15-19 years
20-24 years
50% of total premium subject to annual increases
25% of total premium subject to annual increases
25 + years
Will contribute the same premium cost share dollar amount as immediately prior to
retirement without being subject to future increases in premium.
Medicare - Part B
No reimbursement.
Life Insurance
$10,000 upon retirement
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WASC MEETING MINUTES – MAY 1, 2015
Appendix A: Summary of Post Retirement Plan Provisions - Post October 1, 2000 Hires
Post-Retirement Health Benefits: None
Pre-October, 2000 Hires
Post-October, 2000 Hires
5% University contribution
if employee contributes 5%
for years 1-9
10% University contribution
for years 10-19*
12% University contribution
for years 20+*
9% University contribution
if employee
contributes 3%
(no future change)
Note: The University 403(b) contribution changed in October, 2000:
Appendix B: Medicare Part – D
•
In 2006, The U S Federal Government enacted Medicare Part - D to subsidize the
costs of prescription drugs and the related insurance premiums for Medicare
beneficiaries – which only can be obtained through private insurance
companies.
•
While Medicare Part - D subsidized these costs previously not covered prior to
2006, no coverage was provided to retirees for prescription coverage cost
between the “initial coverage limit” ($2,960 in 2015) and the “catastrophic
coverage limit” ($4,700 in 2015). This gap in coverage is referred to as the “donut
hole.”
•
Under the Affordable Care act (ACA), effective in the year 2020, Medicare Part
D will increase prescription drug coverage, eliminating the “donut hole” by
reducing the amount retirees are required to pay from 100% (pre-ACA) to 25% in
2020.
•
This change in Medicare Part D coverage effective in 2020 will be reasonably
equivalent to the prescription drug coverage and cost currently provided by the
Plan
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WASC MEETING MINUTES – MAY 1, 2015
Appendix C: Medicare Part D – Today vs. 2020
Appendix C: Medicare Part D – Expected Costs in 2020
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WASC MEETING MINUTES – MAY 1, 2015
Jonah Safris – WASC Service Committee Chair: Food Drive will be held at the WASC
Annual Picnic. All items will be donated to Hillside Food Outreach. Communications of
items needed will be sent out via email to staff. An extra raffle ticket will be given to
those that donate goods.
April Minutes approved.
Meeting adjourned 11:00 AM
Minutes respectfully submitted by Lisa M. Faillace
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