ALC-Employee Benefits Division Oversight Subcommittee

The meeting be called order. And appreciate your patience as we work through a couple things here Mr vice chair do you have any comments from committee before we get started all right we thank you all for being here the first item on the agenda is consideration to spend to suspend the subcommittee rules to take up the agenda items in members I don't know if you all received emails on it several of us had emails that this is actions that need to be taken so I'd entertain a motion. I have a motion from senator samples second from senator Bledsoe all those in favor say aye opposed no. The rules are suspended so we can take up the agenda items the first item is approval of the actions of the state board of finance on July the eleven twenty twenty to the state board of finance adopted health insurance premium rates for members of the Arkansas state employees and public school employees for the county year beginning January one twenty three and it for purposes of this agenda item if I could have missed tolls and Mr bleed Mr blue designs and I do see Mr blade on soon and also represented Ferguson up there's well so. co chair. The members I'm I'm gonna go ahead and make mention of we're not going to talk about it at this moment but so that you have it in front of you I talk representative Wardlaw others a memorandum that we're going to want to talk about a little bit as we get into the next agenda item but I want you go ahead and have it so staff could go ahead and pass that out that way members could at least have it to refer to it and with that ma'am would you mind stating your full name and who you represent for the record please yes. Good morning my name is Jelena tolls I'm the deputy director of the employee benefits division. Department of transformation and shared services all right thank you for being here Mr blade I guess for the record if you wouldn't mind doing the same. Yes Sir good morning thank you for letting the zoom in Italy my name is Jake lead on and record employee benefits division of the our. This section instead services right thank you madam co chair I'm recognizing you because we see you as well appreciate you for being here and with that I would recognize ms tolls and Mr bleed for presentation. So good morning shall go ahead and go first and if there are any members of the committee you have questions please just let me know if you have any sense virtually I'm not in the room I can't really see what's going on the proposal for the subcommittee today is really the implementation of policies with we are proposed at last month's a subcommittee if you recall from last month's discussion we have been taking a hard look at how rates are determined for members of the plea benefits division which is to say how much do you pay for your health insurance if you are state or public school employee the issue here in my mind is one of sustainability and arming the planet with the ability to raise sufficient revenues to meet the needs of the plan at our existing benefits this is something that I think the plan and the assets that are not doing I thank you for years we've got in the habit of not addressing any rate changes as costs go up so we work with our actuaries The New in group to adopt what are really industry best practice those best practices are really three a policy proposal which we discussed last month the first is to adjust rates so that they reflect the amount from a basic standpoint It individual should pay at based on the claims experience the plan and then second to apply eighty percent cost share on the part of the order this is something that when we look at our surrounding states we determined that this state portion which is about sixty five percent what is really pretty low compared to our surrounding states so we want to go ahead and raise that up to eighty percent standard there also was a great deal uniformity so by applying that standard across the plants there is an opportunity to create some activity fairness. And also need to get some rest for the poor. The third issue was to recognize if we implemented those two changes you we would create a lot of changes for the player the reality is that for both plans have not had a great deal of rate changes over the years of a school plan taker has not changed much and of course if your rates are staying static wall costs are going up in those rates are not going to do a very good job and cost of the plant so instead of implementing this all at once and causing a great deal of destruction with some members and far less or some members are more including the state we have implemented a five year phase so that starting in twenty three and going through twenty twenty eight we will have us slowly incrementally putting into place these policies so by the time we get to twenty twenty eight we will have she does or best practices but able to do so within the budgets of the state and the members. So if the members wanted to go ahead and pull up the attachment we can go over that in detail but at this moment I can also stop and see if there are any questions. Members do you have any questions for Director bleed. I'm not saying anyone in the queue. Rector believe you have anything else. Thank you frozen in a direction on. I'm gonna make sure we hear from you your for your screens frozen but I heard you At least you're not a cat okay have a good start I'm being told it might. Being told my connection is a stable my apologies I'm up in Wisconsin so maybe they'll have the best internet in North Wales all right is there anything missed tolls that you want to add to the conversation. Necessarily but I'm here to answer any questions could help all right. Members you've heard from Director blade on this matter and I don't see anybody with any questions so what's the will of the committee. I have a motion from representative Wardlaw for review of this item is your second. I have a second from Senator sample all those in favor say aye All opposed no. In the motion passes thank you Director believe missiles we appreciate you being here you may want to somehow stay engaged Director bleed for the rest conversation at this time I would like to refer recognized actually represented Wardlaw co chair rail C. for some comments before we get into Adam E.. Thank you Mr our if it's okay with you will go into the memorandum first and if if you would. I would like to bring Siegel to the table for the memorandum please all right and I believe that's all before we really get deep in the E. is that correct yes Sir okay I recognize you represent Wardlaw and and Segal was invited members this is going to be somewhat reference the memorandum that's been passed out to you with that represent Wardlaw you're recognized Sir thank you at the end of may first of June I don't recall the exact day there was a news article that came out about salinity plans that are no longer allowed to be sold in the market of Arkansas if you read this memorandum it starts on the third page but you got account front back it's it's basically notes from the Committee of all commerce from the federal level and are going through some investigations that they had done on the made the plans and how those plans pay their members how diagnosis codes play into it I want to make sure that the public in the committee understands the difference between what we have been and what we just contracted with as a state and a individual plan so I met with the consultants for a committee of miss Kirsten I. think is ready to discuss those differences but I just want everybody to be aware there are actual and this is a good time to bring this up there's actually going to be education around the state Director believe may want to talk about that he sent to schedule out to the members I would encourage members to go to those meetings with your constituents so you can understand how this plan plays out and how the enrollment in the opt out will play out when opened Roman opens in October those schedules are in your email and as I said Director believe may want to comment into that but United as went above and beyond to schedule multiple multiple education opportunities for your retirees to participate in all. All of your districts so with that Mr chairman of I'd like to see your comment on the member and sure and just for the purposes of the record if you would please just go ahead and state your name and who you are for the record I believe we have another gentleman with Siegel that's remotely joining. That's correct my name's Kirsten Schatten with Siegel. Can be a single. Matters in which CBOE Patrick Klein was sealed. And then Scott. Right thank you Sir you're recognized. Okay yeah we just received this I have not had a chance to look through but I think I'll start with just a few comments on the differences between individual plans and group plans and then is there any specific questions we can talk about that we can We can also talk about that there were some plans that were stopped from being marketed in this state the couple of other states and what the reason was there what's the difference in the way that we did it with our group plan so inmate PD was originally written for individual plans. when you talk about an employer group waiver plan what's that is our waivers that were written into regulation that allow things to be changed in a group setting that are different from an individual plan to allow free the group plans to be part of the market place. it allows a lot of waivers you can pick your own plan design you can decide your own eligibility and enrollment you can decide when people come and when people go out. All all different types of things through the employer free waivers and when we write an RFP there are many requirements we have we require we require as you know this one is set for a passive PPO which means you have in network doctors you also have the same benefits if you go out of network that's a waiver for a group plan so individual plants don't have that ability in doing so yeah it's on the plan to make sure that they they're gonna reach out to every single provider that you're members of ever made those providers have options to be in network or out of network the United healthcare the vendor that we have here also allows providers that are in network to have other ways to receive bonuses if they do certain things they also allow that for their out of network providers so a lot of flexibility with regard to providers the reason United healthcare was stopped from marketing in this in a couple of other states is because in their individual health plans there medical loss ratio was too low for three years in a row meeting they were making too much money. So if the medical loss ratio I believe the amount is eighty five percent that they have to report back to Medicare and for three years in a row it was less than eighty five percent the thirty year was the year of covid in which a lot of elective procedures weren't weren't done before going to the doctor they were scared to go to the doctor if it was necessary it wasn't provided so in that year medical loss ratios fell for a lot of plans. Maybe they were banking on that being the year they met the requirements whatever because of that that's their penalty but in a group in may planned when we did this thing not only do we have fully insured rates for every year of the contract we also have medical let medical loss ratio guarantees that are much higher than eighty five percent and if they fall below that medical loss ratio we're going to share and that money between the plan and the vendor so that's just some of the differences between the group and may plan and the way this is set up and how it's different from the individual plans and what happened in the state and I'll take any specific questions that you might have just that person he referenced in networking out of network and in the individual market Medicare advantage plans in networking out of network is truly distinct and generally an HMO plans out in our peace would not be covered in the group plan that's been procured here for the state those in and out of network benefits are covered at the same rate for members of this really from member perspective that's C. seeking care they're gonna be seen paying the same level of out of pocket costs what they see in in network provider or not and provider. Okay. All right. The members if you have questions please ring the queue recognized representative Wardlaw. Thank you Mr chair and I want to speak to what was just said I think that's one of the misconceptions in a public today is the in networking out of network and how that payment is process and I want you to understand exactly what Arkansas to just told us is that the payment is the same and that the reason that is in placement is just like I told you from the well of the house this plan is a mere plan of the current plan so therefore the payments are mere the providers of the same I can't enhanced out of love so with that Mister chair I I thank you for let me make that comment. Yes Sir. Members any other questions for Siegel. On this issue. I don't see any representative Wardlaw do you have any other comments on this server or maybe the memorandum in general so that the I know people just got this maybe they can understand what they're looking at. There you go no Sir I think I think we covered it well and I think we cover the differences in the plan so that membership in the public both have an explanation of what they are going to get it out October okay very well thank you Lucy senator Hammer. I thought I did all right thank you Mr. All right so just wondering will clarity in my mind anyway so there are some concerns out there that United is the carrier that's going to be handling this is it. What you're saying in layman terms that we don't need confusion what individuals may purchase out there as individuals off of TV ads or any other kind of stuff confuse that with this plan because this is the group plan is that I mean the long and short simple explanation it is and it and it's not just a group plan it's your group plan based around your benefits right because the gentleman down in. came down a bit and explain to the teachers down there is that this is not an apple to apple comparison to what's being offered out there through other means and that's what separates it and that needs to be the message it needs to be pounded home is that correct yes all right thank you. And who we have in fifty four I don't have a name with it but here that is recognizing thank you Mr chair my name is Linda Chesterfield said. I didn't have a name center I apologize I'm just hanging out trying to find out information What does one do I like to have an individual who has not been a part of any group planned to date they have not taken their Medicare eligible but have not had one of those supplemental plans how do they get involved with this. They merely sign up what happens. How do we got that person who was never signed up for additional health care other than Medicare in order they may take advantage of this. I guess that has to do with your eligibility rules so are they you know it would depend on what the rules are for state and teachers you mean in the plan. So if they I mean typically if they age into Medicare they're on the plan and their eligible for retirement benefits in the age into the plan may sign up for Medicare they pay part B. premium for Medicare and and currently they would they would choose the rat plan here right what what is how it currently exists so however they have the option to choose that route plan currently they would have the option of that or the MA PD planned so if they didn't sign up for a rat plan today I'm not I don't know and maybe J. could speak to what the eligibility rules for someone that now wants to come on to the plan and join the inmate PD plan. Well in and out if I made to Mr beaver before that Mister chair. Should this not work should this not prove to be as wonderful if it sounds what then do we have in place is a state. In order to hold you accountable should you not be able to deliver all that you've told us that you're going to. On the MA PT plan well the members have an option to be to stay in the plan they're in now or be in the inmate PD plan we have guaranteed rates we have MLR guarantees we have performance guarantees with them so We when we originally put this out here and said and and we've been through the process right we we have chosen the the vendor that would be awarded United healthcare originally when we came in here we we lease we estimated and we said it was conservative and we expected better savings when we went into a competitive bid originally we we projected that. The total cost we we could save. Get my numbers from make sure I'm correct On a full replacement basis meaning if everyone women the projection was that we would say forty million dollars. Because there is an option we we said assume seventy five percent go in the inmate PD so that be. Thirty million. Seventy five percent of the forty about forty that we projected regionally once we went through the process the savings was double that eighty million. So if seventy five percent go into a Medicare advantage plan the savings is forty million those numbers are locked in. So we don't I'm sorry sixty so if we we do have a clawback clause in there I assume this is if you can't do it and we get our contract back from you. You definitely have language in the in the contract to get out of it thank you thank you Mr thank you senator recto believed do you have some comments on that particular question it will yeah if I could response to the question if there's an individual out there who is wondering how of they could best take advantage of this planet this is the right thing for them to do the first thing is to start asking those questions now we are creating resources for members for providers for everybody might have questions of lakes represent Wardlaw mentioned earlier we're gonna be going around the state will probably meetings or virtual meetings in addition we have a phone staff here at you will be handling hit eligibility questions it in training with United for the last two weeks so the first thing that that individual really should do is take a look at their specific needs a look at the options that are available and try to the best they can to make an informed decision I think it's great that you're asking that question you've got a institutions that they're asking. If there is somebody who is has a breaking coverage or some are a has an issue with obtaining our our our coverage that's something we can work through the number if they want to just call EDB apples or trying to handle that question. But really the first thing you do is is for that number to make sure this is a good fit for that we're very confident that this will be a very good fit for most people my expectation is that the vast majority of us will not see a difference other than a reduced premiums and additional options. Our. I also did if I could just address the memo that was mentioned earlier discussion just to state for purposes subcommittee that issue actually came up in our contract discussions with United and I have raised the issue with a Mister Thompson there be multiple times very happy with the response and and that this is not an issue that we can anticipate becoming a problem for members that said we have certainly put them on notice that we will be watching that as an issue and we will certainly make use of the performance guarantees other protections that we have in a contract in the event that something goes wrong. Okay thank you and members were related to that memo again this all came in right as we get started I didn't recognize until now that Mr Winston section is actually here Mr Simpson you've heard the discussion we do have your memo is there anything that you have in particular you wanted to add Sir. I'll be happy recognize you if you'd like to just say a word. Okay if somebody at least is clear just one chair at least for Mr Simpson so that he can be recognized to. At least to say a few words but this time in. He is a public school retiree and Again since he's made the effort to be here I want to make sure recognized and Mr Simpson thank you senator our. I don't think I have access this memo you've been talking about okay I thought I was told that you wrote this. Maribeth I was told you wrote this memorandum that we just passed all K. I didn't know that's what you were taught that you talking about something they had prepared well too many memos run around right yes would but what we have Mr Simpson is what you're prepared and and it references the Committee on energy and commerce so that's really what was introduced a few moments ago so apologize for any confusion I can hear you and the other members to speak loud and clear and people that are on the. Screen but it's I didn't understand much of what these individuals said shall okay perhaps a manager so my questions I did hear a nurse to understand well the the essence of what I did understand is okay this is a group plan it's different from what all these studies are that I'm reporting. and I don't believe that I don't understand that to be the case the studies that were done is I understand that are referenced and and the memo I wrote and that to the attachments there are many more presented at that meeting that day but I didn't try copying all it. group plans were included in the universe of the studies that were done. hi how parent relief from what little I could understand the essence of what the United healthcare people are saying is that. the problems were not with the group plans that was with individual plans I didn't see any reference to that sort of thing and the research that looked at and hopefully it's all taken care of really my mother purpose for coming today is very simple and straightforward. no matter what's going on with other plans in fact United not mentioned at all in these. Our studies that I looked at except that they were listed in one as one group that was included in the universe from which samples or draw so I didn't come here to criticize United health and any anyway I don't have basis do that I just simply don't wanna ask this committee and director believes staff to oversee implementation of this plan to make sure that the retirees in the planned or Medicare eligible. get timely access to their health care services that they're entitled to under Medicare without any undue burden some pre authorization pre authorizations of part about being a plan I'm not fussed about pre authorizations but in the studies that were reported pre authorization down aisles of pre authorizations as well as a significant problem done aisles of patients payments for significant problem. and and studies indicated that the plans themselves overturned their own to Niles said of area high right like seventy five percent but only one percent of the beneficiaries and other providers appealed so that means that most all of those the Niles actually organized and I. Simply ask that. This committee and director believes staff do everything reasonable to try to make sure that our retirees in this state and public school system. Can access in a timely fashion the benefits they're entitled to under Medicare. Yes hello and I appreciate you here may I will be happy if anyone wants to ask a question about anything I've included sorry I didn't realize the member memorandum you were talking about my lotus errors. But will often we lay at the feet of people many things they don't do sure right and just missed mission so we appreciate it and really appreciate your service and for taking the time to come down and speak about this very important matter Senator Hammer do you have a question here for I'd like tests the Siegel group of quick questions if I may do you have any questions for senator for Mr section I'll dismiss him no Sir I do not okay Mr Simpson thank you so much comfort Commission. you're recognized syndrome thank you Mr chairman could you remind me of what will be the correlation between the time the participants have to make a decision as to whether they're going to join the plan or opt out and the list of the providers that are actually going to be of providing services to the members one of the concerns has been expressed to me is that not all providers may recognized the United plan and maybe some of that is built on the speculation of their experiences outside the group is being posed verses this group so can you kind of put at ease the fear that there may be providers that will not provide services so that individuals in the plant would not be able to go to the provider they've been used to going to for a long time by cemex yes regarding the providers we destruction Alice's we actually took all of the claims every claim every provider in there and sent it out to the bidders and had three different sections so tell us is this project is this provider under contract in participating I E. in that work it is this provider not under contract but accepting members and is that none of the above and very very very high percentage high nineties I don't remember exactly the number maybe ninety nine or either in network or accepting on my out of network basis so what they'll do with those remaining ones that that they don't have been there or if they have somebody if they have a provider in there that somebody has seen that they've not contracted with or not spoken to to make sure they'll accept members and and I actually am going through and implementation right now we have this. Conversation last week not only did we provide that in the R. P. they won an updated list and my question to them in this is United healthcare as well same group do you want me to rank that bye number of people seeing them or dollars spent with that provider and their answer was no we don't need that we're going to reach out to every single one so is there hope to to get every provider I mean they have advocates for providers to understand the process sees and and those the lights but that's a very very important part of the implementation so when will that provider list be finalized that the individuals that are gonna be signed up for the plan would be able to look at it and know that they're providers in it well we haven't. We but we haven't been involved in the implementation recently so I'm going to put that question back to Jake and So that's one question I think you had another question on eligibility at the beginning which again goes back to the state rules so that's one of the that's one of the group waivers is that that eligibility is based on what the state side so I think Jake would have to speak to both of those things per share could we get an answer from Jake yes Sir and then definitely this next item is going to have quite a bit of discussion so we'll try to wrap this up thank you if I just hear from him yeah. So if I can United healthcare is already very active in Arkansas they already have a very broad network enabled they provided us with all the folks who take their group Medicare and who also taking individual plans for that that is as soon as regardless in addition we've made it clear and we'll make it clear through our communications our education providers that if you're seeing a member is covered by the now and for whatever reason you won't see that member under under Medicare advantage but we really like to know why as representative Wardlaw mentioned earlier compensations the same coverage and benefits is an really a mirror image issue so we anticipate adding a very very broad network and a lot of participation as far as the process for eligibility we will be in communication and networking the the community communicating to our members and our network providers here this summer in the fall beginning in November there will be an opportunity for members to opt out that will last throughout the month of November in addition in January coming out if for whatever reason a member was able opt out or gets a letter in the mail this that makes them think twice about it they will still have an opportunity in January opt out as well so we really want to make sure that this is an opportunity for members to be educated and to make informed choices that this is not something that they feel like they're being forced into that is your questions Senator. He said yes directly thank you very much of representative Dotson I see you have a question. Yes Mister chair and and I'll know if Mr bleeder or Segal either one probably can answer this real quick I keep hearing that the the benefits mirror each other as far as the MA PT and specially for teacher retirees and that sort of thing but if I recall correctly we added a pharmacy benefit and so it doesn't exactly mirror it's it's a much more if I'm you can just confirm this yes or no it's a much more rich plan within APD B. group plan because it has the pharmacy benefits which they don't currently have is that correct that's a very good. Japan license getting notified that it. Go ahead work area our our the medical benefits of the standpoint medical coverage the benefits are identical there will be additional coverage for things like pharmacy for or school retirees as well as submission no benefits like dental vision that sort okay thank you I just wanna make sure that was that was still part of the. It's discussion and actually fleshed out thank you. Representative Wardlaw. I'm just keep it up for you okay for the next one yes Sir just stay alive we'll because I think we're ready to go members we're gonna move on to Adam ET which is the pharmacy benefit manager or if the update you've also been passed out a document entitled email from the Siegel group to be L. R. dated Monday July the eleventh if you haven't looked at that that's been passed out to you by the staff and with that representative Wardlaw would you like to make a comment sir yes Sir thank you. West sorry about that region Wardlaw staff if you would please make sure going to get it out they'd indicated they'd pass it out of sorry members and I will also make mention of apparently they ran out of the memorandum and they're making extra copies for the memorandum that was referred to earlier that Mr Simpson had so they'll be working to make that right represent Wardlaw go ahead Sir. Thank you Mr so members I will kind of go through a little bit of history yes for those of you that one aware of some actions that council had taken in January of this year AOC authorized the bureau to enter into a contract with Siegel that contract was for the amount of six hundred eleven thousand dollars in two six hundred eleven and two hundred dollars I said that wrong six hundred eleven thousand dollars the primary purpose of which was to allow Siegel to assist the needy with Imedi and P. B. M. procurements I want to be clear on that that was the reason for that contract was for us to do that the bureau then entered into an MOU with AB de to allow Siegel to work directly with the B. day on June twenty ninth Seagal reached out to be are to let them know if they were concerned with how the PBM ours P. was being handled. The Siegel was being cut out of the process Senator rice and I were then notified and then we ask you go to be here today to give us an update in their concerns those updates and concerns are on that email. Form that has been handed out to you guys so with that Mister chair I would turn it over to see you go to go through that events. All right and represent Wardlaw most going to make sure and ask members do you do you have this in front of you now. Okay if anybody does not have it raised their hand and will try to get it but this is what representative Wardlaw was referring to and with that will I'm sorry. Come to the table in this talk about something to do with your by law to the to the RP discussions I just wanna make sure that we're all operating. Under the same understanding. We talk about the PMR because there's some things that are confidential you're you're with procurement Secretary of DSS we're over procurement also director. And so I just I want to relay this before we get too far. I will allow that at that thank its appropriate if you've got a concern about what could or could not be said and Paul jazz there for the Siegel group if you just really one chair for a moment. And if you will state your your full name sure and who you're representing today. Mr aus US secretary of TSS and director of OSP. Sorry to interrupt I just wanted to make sure that we're on the same page this PBM R. S. P. this solicitation there has not been an anticipation to award yet so there is not been a vendor that has been selected for this BBM. Under procurement law. We cannot discuss the details of what's been submitted we can talk about in general the process. we can talk about you know really the procurement process as a whole we cannot talk about individual scoring who scored what what vendors were qualified what vendors were disqualified specific vendors that have put is in we can't talk about you know who submitted what and what they submitted and what the costs were or anything of that nature because we want to make sure that who we select. Who wins this R. F. P. is done in an objective process that is for the best interests of the state and introducing outside influence in an objective process before a vendor is anticipated to award. Violates that process which is why that exists in the law so I am happy for Siegel to discuss their issues here but they must discuss them in a very high level objective way because we cannot talk about the specifics of this RFP. Okay and and your last name is pronounced rouse I will make sure his first time of hedging Committee action yes yes Sir or center road that being said Mister Wardlaw representative Wardlaw you know this email that is been released now to the committee. Oh okay he's referring with counsel. Members this was all presented here at the meeting so create your patients and having us let's figure out just what's going on here. Represent Wardlaw. Not sure how you as a chairman want me to proceed with this comment. I would suggest. Maybe a ten minute recess to meet with the Secretary we get leadership and see where we need to for C. I think that is warranted especially in light of the volume of information that was just put out in this email that was released everybody on the committee with that we'll be in a ten minute recess so that we can have a discussion thank you. just want to make an announcmenet we we have just a little bit more time frankly there's going to be a decision made on this one way or another here coming up briefly but we're going to remain in recess wall several parties or discussion and I apologize for the delay but it's necessary we remain in recess. Members of the committee is out of recess now and I would like to clear the chairs if you would like to ask secretary road to come to the table please. Thank you single for your help today fall jazz for the time that's involved but it sounds like that there's been some headway here show. Mr secretary you're recognized. Mr aus secretary department of transformation injured service and I don't know if you're going to ask me questions or if you just want me to give so we are going to pull down the solicitation that's out there and we're gonna restart that process so that'll be the path forward will start from scratch will work with Siegel moving forward will cooperate with them collaborate with them on this the developing the RP and getting it back out on the street and we'll go from there all right thank you for your time members no more business today were Jr.