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Pensions and Benefits
STATE HEALTH BENEFITS PROGRAM
PLAN DESIGN COMMITTEE MINUTES 2011
 

Meeting No. 1, Minutes
July 20, 2011, 1:00 PM
State Health Benefits Plan Design Committee

Adequate notice of this meeting was provided and filed with and prominently posted in the offices of the Secretary of State. The meeting notice was mailed to the Secretary of State, Star Ledger and the Trenton Times on July 15, 2011. The meeting of the State Health Benefits Plan Design Committee was called to order on Wednesday, July 20, 2011 at 1:10 PM. The meeting was held at the Thomas Edison State College, Prudence Hall, 101 West State Street, Trenton, New Jersey, and was attended by the following members of the Committee, Representatives from Aon Hewitt and Division staff:

Rich Constable, Deputy Commissioner, Department of Labor (joined via phone @ 2:10, left @ 3:45)
Keith Dunn, Executive Vice President, NJ State PBA
Regina Egea, Chief of Staff, Office of the Treasurer
John Hutchison, Senior Policy Advisor, Department of Environmental Protection
David Jones, President, STFA
Jeff Keefe, AAUP-AFT
Ken Kobylowski, Chief of Staff, Department of Banking & Insurance
Steven Kreisberg, Director of Collective Bargaining and Health Care Policy/AFSCME –
Marc Larkins, Chief Executive Officer, Schools Development Authority
Matt McDermott, Chief of Staff, Lt. Governor’s Office
Brian McMonagle, NJFMBA
Hetty Rosenstein, New Jersey Area Director, CWA/District 1 –
Edward Fox, Senior Vice President, Aon Hewitt
James Christ, Vice President, Aon Hewitt
Susan Marsh, Vice President, Aon Hewitt
Eileen Den Bleyker, Deputy Attorney General
Florence Sheppard, Secretary
David Pointer, Manager, Policy, Planning and Operations
Jean Williamson, Health Benefits, Policy and Planning

1. Sunshine Act Statement

The Sunshine Act Statement and the Executive Session Resolution were read.

2. Welcome and Introduction of Committee Members and Staff

Florence Sheppard welcomed the Committee and everyone around the table introduced themselves.

3. Election of Chairperson

Hetty Rosenstein suggested the Chairperson should be one of the Committee members from the unions.  Regina Egea asked that a decision be deferred until Richard Constable joined the meeting via telephone.

4. Summary of Chapter 78

David Pointer gave a brief overview of Chapter 78 as it pertains to health benefits.

5. Role of the Committee

Eileen Den Bleyker explained and referred to Chapter 78, page 84, Section 45, which established the Committee and to page 92, Section 47(J) which describes the plan options the Committee is to provide to employees effective January 1, 2012.  Hetty Rosenstein requested a copy of DAG Den Bleyker’s remarks and DAG Den Bleyker advised that she had her personal notes but she would take the request under advisement.
 
6. Aon Hewitt Presentation

Ed Fox, Aon Hewitt, introduced himself and his team, Jim Christ and Susan Marsh.  He provided a background on Aon Hewitt highlighting the team’s experience with the State Health Benefits Program (SHBP) and the School Employees’ Health Benefits Program (SEHBP) as well as Aon Hewitt’s public sector experience.  He also explained that most of the data in the rest of their presentation was based on the Segal Survey of Public Employers. Copies of various surveys were included in a folder of documents which was distributed to the Committee. There was a request to receive this Power Point presentation electronically.  Florence Sheppard said she would e-mail it to the Committee. 

Jim Christ presented a general overview of the types of health benefits plans, deductibles, copayments, and out-of-pocket (OOP) maximums that are common in state governments across the country. He discussed the percentage of plans that require an employee premium contribution.  He also gave a brief summary of the SHBP groups: the State Group and the Local Government Group and the projected costs for each. He ended with an overview of the SHBP vendors. 

Susan Marsh spoke about the plan design features of NJ DIRECT10 and NJ DIRECT15.  She reviewed several graphs that compared New Jersey to other states including a comparison of physician copayments, OOP Maximums, and generic, preferred brand and non-preferred brand prescription drug copayments.  She also explained the current amount SHBP employees and retirees contribute for health benefits and what the new contribution arrangement under Chapter 78 is.  These contributions were expressed as a percentage of total plan costs.  Finally, Ms. Marsh compared New Jersey’s employee contributions against what other state employees pay.

3. Election of a Chairperson (continued).

Marc Larkins made a motion to nominate Regina Egea to be the Chairperson.  It was seconded by Ken Kobylowski .  Hetty Rosenstein restated her position that one of the union Committee members should be given the role of Chairperson since it would have a good effect on the workforce.  Steven Kreisberg made a motion nominating Jeff Keefe to serve as Chairperson and Hetty Rosenstein seconded the motion. A vote for the Chairperson ended in a tie vote, with six members (Constable, Egea, Hutchinson, Kobylowski, Larkin and McDermott) voting for Regina Egea, and six members (Dunn, Jones, Keefe, Kreisberg, McMonagle and Rosenstein) voting for Jeff Keefe  After some discussion, Regina Egea suggested alternating the Chairperson position every other meeting between the union and the Governor appointees.  No consensus was reached. 

Steven Kreisberg made a motion that the next meeting be chaired by Jeff Keefe.  The motion was amended to add “and the Committee set an agenda for that meeting”.  Hetty Rosenstein seconded the motion. The motion carried unanimously.  Subsequently it was stated that since Jeff Keefe will be on vacation the week of July 24th that the next meeting should not take place until his return.  There was some concern about having to wait.  Marc Larkins requested the next meeting be an educational meeting and it was agreed that no action would be taken by the Committee at that meeting if it was held that week.  DAG Den Bleyker advised that anytime seven or more Committee members meet it is an open public meeting and adequate notice of the meeting must be given to the Public.  

Some of the ideas for agenda items included:  options, a breakdown of the components of the plan design, how rates are set currently, a sample of the information Aon Hewitt would present to a client who was designing new plans, why health insurance is so expensive, value-based design, framework for making health benefit decisions, cost drivers, how unions are approaching health care plans and Taft Hartley plans.

The following dates and times were determined for meetings:

Wednesday, July 27, 2011 at 9:30 (Educational only, no action will be taken);
Wednesday, August 3, 2011 at 1:00
Tuesday, August 9, 2011 at 1:00
Wednesday, August 17, 2011 at 1:00
Thursday, August 25, 2011 at 1:00

Locations for the meetings would be acquired by Division staff.

The Committee meeting was adjourned at 4:43.

  Respectfully submitted,
 

 

 

  Florence J. Sheppard
Secretary
SHBP Plan Design Committee


Meeting Minutes
July 27, 2011, 9:30 AM
State Health Benefits Program (SHBP) Plan Design Committee

Adequate notice of this meeting was provided and filed with and prominently posted in the offices of the Secretary of State. The meeting notice was mailed to the Secretary of State, Star Ledger and the Trenton Times on July 21, 2011. The meeting of the SHBP Plan Design Committee was called to order on Wednesday, July 27, 2011 at 10:05 AM. The meeting was held at the Division of Pensions and Benefits, 1st floor board room, 50 West State Street, Trenton, New Jersey, and was attended by the following members of the Committee, Representatives from Aon Hewitt and Division staff:

Regina Egea, Chief of Staff, Office of the Treasurer
Ken Kobylowski, Chief of Staff, Department of Banking & Insurance
Marc Larkins, Chief Executive Officer, Schools Development Authority
Brian McMonagle, NJFMBA
Hetty Rosenstein, New Jersey Area Director, CWA/District 1 –
Edward Fox, Senior Vice President, Aon Hewitt
James Christ, Vice President, Aon Hewitt
Susan Marsh, Vice President, Aon Hewitt
Michael Morfe, Aon Hewitt
Eileen Den Bleyker, Senior Deputy Attorney General
Rubin Weiner, Deputy Attorney General
Diane Weeden, Deputy Attorney General
Florence Sheppard, Secretary
David Pointer, Manager, Policy, Planning and Operations
Jean Williamson, Health Benefits, Policy and Planning

Eileen Den Bleyker stated there was no quorum.  She said this is an informal session and no action will be taken.

1. Sunshine Act Statement

The Sunshine Act Statement and the Executive Session Resolution were read by Florence Sheppard.  

Ms. Sheppard addressed housekeeping items.  She asked the Committee members to provide a copy of their resumes to her and asked them to RSVP when she sends meeting notices to them.  She also stated that the meeting was limited to two hours.

2. Jim Christ introduced Mike Morfe from Aon Hewitt who provided an overview of options for Medicare Prescription Drug integration.  Mr. Morfe gave a Power Point presentation in which he explained that currently the SHBP receives a subsidy for Medicare retirees through the Retiree Drug Subsidy and he gave an overview of the Employer Group Waiver Plan (EGWP) Plus Wrap for consideration.  No action was taken.

3. Jim Christ gave a presentation on Health Care Strategies for the Future.  Hetty Rosenstein asked how we know if we are getting the best price from our vendors for the services provided.  Susan Marsh said the competitive bid process enables the SHBP to get a good price.  Ms. Rosenstein stated that 48 states use bulk purchasing for prescription drugs.  Regina Egea asked for more details regarding Consumer Driven Health Plans (CDHP), flexible spending accounts (FSAs), health savings accounts (HSAs), etc.  Ms. Marsh stated there is information in the memo that was distributed and Mr. Christ suggested a separate session on this subject at a future meeting.

There was some discussion about hospitals and tiered networks, reimbursement levels and Centers of Excellence.

Ms. Rosenstein asked if there are occupational groupings that are tracked for certain types of health issues.  Ms. Marsh stated that experience is looked at as a whole, not by occupation. 

4. Ms. Marsh gave a high level overview of the July 26, 2011 memo from Ed Fox, Aon Hewitt that was distributed to the Committee members.

5. Ms. Sheppard took the official roll call, confirming there was no quorum present.  She asked the Committee to determine the agenda items for the next meeting.  Ms. Egea asked Ms. Rosenstein if she would share the bargaining proposal regarding the healthcare and Ms. Rosenstein agreed to send it to Division staff for distribution to Committee members.  Ms. Sheppard reminded the Committee members that Ethics Training would need to occur prior to the next meeting.  She agreed to delay the meeting start time to 2:00 pm on August 3, 2011 in order to provide Ethics Training at 1:00 pm.

The Committee meeting was adjourned at 11:35.   

  Respectfully submitted,
 

 

 

  Florence J. Sheppard
Secretary
SHBP Plan Design Committee
 

Meeting #2, Minutes
August 3, 2011, 2:00 PM
State Health Benefits Program (SHBP) Plan Design Committee

Adequate notice of this meeting was provided and filed with and prominently posted in the offices of the Secretary of State. The meeting notice was mailed to the Secretary of State, Star Ledger and the Trenton Times on August 1, 2011. The meeting of the SHBP Plan Design Committee was called to order on Wednesday, August 3, 2011 at 2:15 PM by Acting Chairperson Keefe. The meeting was held at the Division of Pensions and Benefits, 1st floor board room, 50 West State Street, Trenton, New Jersey, and was attended by the following members of the Committee, Representatives from Aon Hewitt and Division staff:

Richard Constable, Deputy Commissioner, Department of Labor
Keith Dunn, Executive Vice President, NJ State PBA
Regina Egea, Chief of Staff, Office of the Treasurer
John Hutchison, Senior Policy Advisor, Department of Environmental Protection (via phone)
Jeff Keefe, AAUP-AFT
Ken Kobylowski, Chief of Staff, Department of Banking & Insurance
Steven Kreisberg, Director of Collective Bargaining and Health Care Policy/AFSCME –
Marc Larkins, Chief Executive Officer, Schools Development Authority
Charles McKenna, Director of the Office of Homeland Security & Preparedness
Brian McMonagle, NJFMBA
Hetty Rosenstein, New Jersey Area Director, CWA/District 1 –

Absent:  David Jones, President, STFA

James Christ, Vice President, Aon Hewitt
Susan Marsh, Vice President, Aon Hewitt
Michael Morfe, Aon Hewitt
Susan Fischer, Assistant Attorney General
Rubin Weiner, Deputy Attorney General
Diane Weeden, Deputy Attorney General
Janice Nelson, Acting Secretary
David Pointer, Manager, Policy, Planning and Operations
Jean Williamson, Health Benefits, Policy and Planning

1. Sunshine Act Statement: The Sunshine Act Statement and the Executive Session Resolution were read by Janice Nelson.  

2. Roll Call: Janice Nelson took the roll call:  10 present; 2 absent (Hutchison and Jones).  Committee member Hutchison joined the meeting by telephone at 2:30.

Acting Chairperson Keefe asked everyone around the table to introduce themselves again for the benefit of the new Committee member, Charles McKenna.  Mr. McKenna replaced Matthew McDermott. 

Acting Chairperson Keefe inquired about two requests from the first meeting:  a roster of Committee members and an electronic copy of Aon Hewitt’s power point presentation from the first meeting on July 20, 2011.  Jean Williamson said she was compiling a roster but needed additional contact information for some of the members.  A sheet of paper was circulated around the table for the Committee members to provide their contact information.  Ms. Williamson will e-mail the roster and the Aon Hewitt document to the Committee.

Committee member Rosenstein inquired about her request for information to Florence Sheppard.  After discussing the process for making a request for information,   Committee member Constable made a motion that any Committee member may make a request for information to the Secretary of the Committee who will distribute it to the Committee.  Any Committee member who has an objection to the request will have 24 hours, not including weekends, to file an objection with the Secretary in which event the request will be discussed at the next Committee meeting.  Committee member McMonagle seconded the motion and all voted in favor.  The Secretary was asked to electronically redistribute Committee member Rosenstein’s request in accordance with the new procedure.

3. Minutes:  Acting Chairperson Keefe requested that the meeting minutes be e-mailed prior to the meeting.  The minutes are not final until they are voted upon.  Committee member Larkins made a motion to accept the minutes of July 20, 2011 with item #7 on page 4 struck.  Committee member Egea seconded the motion.  Approved (10: 0: 1, Committee member McKenna abstained).  The Committee noted the receipt of the minutes for the July 27, 2011 informational meeting, however no action was taken regarding these minutes as a quorum was not present at that meeting.  Acting Chairperson Keefe asked for a motion that at the end of the business of each meeting the Committee establish an agenda for the next meeting.  Committee member Rosenstein, so moved.  Committee member Kreisberg seconded the motion.  There was no discussion.  All voted in favor.

With regard to the agenda for this meeting, Committee member Kreisberg made a motion to strike the word “Bargaining” from Item #6 and that the agenda be adopted as revised.  Committee member Egea seconded the motion and all voted in favor.

4. Election of a Chairperson:  Acting Chairperson Keefe asked if anyone had a proposal on how to move forward.  Committee member McKenna suggested alternating the chairperson at each meeting.  There was discussion about this issue.  Committee member Rosenstein said that if there were co-chairs they should have equal access to information.   There was additional discussion.   Committee member Kreisberg made a motion to have two co-chairs, one employer representative and one employee representative, who would alternate presiding over the meeting and who would make diligent efforts to work together and share information with each other as it relates to the Committee.  Committee member Constable seconded the motion.  There was no discussion.  Acting Secretary Nelson took a roll call vote and the motion was approved (11: 0: 0).  Committee member Rosenstein made a motion that the co-chairs be Committee members Egea and Keefe.  Committee member Constable seconded the motion and all voted in favor.  There was a five minute break and the meeting resumed at 3:20.

Committee member McKenna asked if the meeting was going to end at 4:00 and Chairperson Keefe suggested setting prescribed timeframes for future meetings.  Committee member Kreisberg suggested ending the meeting at 4:30 and all agreed.

5. Employer Group Waiver Plan (EGWP) Plus Wrap:  Mike Morfe, Aon Hewitt, gave an abbreviated overview of EGWP Plus Wrap.  Acting Secretary Nelson asked if there were any questions.  There was some discussion about Medco and their contract with the SHBP.  Committee member Kreisberg made a motion for Aon Hewitt to continue to study the implementation of EGWP and report back to the Committee with three caveats:  1) the current design be maintained; 2) additional Part D premiums (charged by CMS to high income retirees) be reimbursed by the SHBP in the same manner as eligible retirees are reimbursed for additional Medicare Part B premiums and 3) half the savings realized from converting to EGWP be applied to lowering copayments for the Retiree Prescription Drug Plan in such a way to encourage member utilization of generics and preferred drugs.  He asked if Aon Hewitt could come back with a plan design to accomplish #3.  Co-Chair Egea stated the finances may be overstepping the function of the Committee and should be reviewed for legality.  Susan Marsh, Aon Hewitt, noted that the current Retiree Prescription Drug Plan has copayments that are indexed.  Committee member Kreisberg suggested indexing the copayments and then applying the savings to them.  Committee member Rosenstein seconded the motion.    Ms. Marsh stated that the estimated annual savings of $80 to 100M is total savings for the SHBP/SEHBP.  The SHPB’s portion is approximately $40M.   Following a five minute break, Co-Chair Keefe called the meeting back into session at 4:09.  Committee member Constable amended the motion to add “for information purposes only”.  There was no further discussion.  A roll call vote was taken and the motion was approved (10: 1: 0 Committee member Larkins voted nay).

Committee member Constable made a motion to implement an EGWP plus Wrap for the SHBP.  Committee member McKenna seconded the motion.  There was some discussion.  Committee member McMonagle proposed amending the motion to take the vote in six days (at the next meeting).  Committee member Constable rejected the amendment.  Committee member McMonagle made a motion to table the vote until August 9, 2011.  The motion failed (5: 6: 0, Committee members Constable, Egea, Hutchison, Kobylowski, Larkins, and McKenna voted nay).  The motion to implement an EGWP plus Wrap was voted upon.  The motion received a majority vote of (6: 5: 0 Committee members Dunn, Keefe, Kreisberg, McMonagle and Rosenstein voted nay), but failed to receive seven affirmative votes.

The next meeting is on August 9, 2011 at 1:00 p.m.  The Committee agreed that the end time will be 3:30 p.m.  The agenda was set as follows:  Aon Hewitt’s follow up on information requested regarding the EGWP plus Wrap, agenda item #6 which was held over from this meeting due to time constraints, Aon Hewitt’s plan design options with estimated premiums.  Committee member Constable asked what the premiums are for the existing plans and David Pointer stated the rates are on the Division’s website. He agreed to e-mail them to the Committee.

Committee member Larkins made a motion to adjourn and it was seconded by Committee member Constable. All voted in favor. The meeting ended at 4:30.                      

  Respectfully submitted,
 

 

 

  Janice Nelson
Acting Secretary
SHBP Plan Design Committee

Meeting #3, Minutes
August 9, 2011, 1:00 PM
State Health Benefits Program (SHBP) Plan Design Committee

Adequate notice of this meeting was provided and filed with and prominently posted in the offices of the Secretary of State.  The meeting notice was mailed to the Secretary of State, Star Ledger and the Trenton Times on August 4, 2011.  The meeting of the SHBP Plan Design Committee was called to order on Tuesday, August 9, 2011 at 1:06 PM by Chairperson Egea. The meeting was held at the Thomas Edison State College, Prudence Hall, 101 West State Street, Trenton, New Jersey, and was attended by the following members of the Committee, Representatives from Aon Hewitt and Division staff:

Richard Constable, Deputy Commissioner, Department of Labor
Keith Dunn, Executive Vice President, NJ State PBA
Regina Egea, Chief of Staff, Office of the Treasurer
John Hutchison, Senior Policy Advisor, Department of Environmental Protection (via phone)
David Jones, President, STFA
Jeff Keefe, AAUP-AFT
Ken Kobylowski, Chief of Staff, Department of Banking & Insurance
Steven Kreisberg, Director of Collective Bargaining and Health Care Policy/AFSCME –
Marc Larkins, Chief Executive Officer, Schools Development Authority
Charles McKenna, Director of the Office of Homeland Security & Preparedness
Hetty Rosenstein, New Jersey Area Director, CWA/District 1 –
Absent:  Brian McMonagle, NJFMBA

Ed Fox, Senior Vice President, Aon Hewitt
James Christ, Vice President, Aon Hewitt
Susan Marsh, Vice President, Aon Hewitt
Rubin Weiner, Deputy Attorney General
Diane Weeden, Deputy Attorney General
Florence Sheppard,  Secretary
David Pointer, Manager, Policy, Planning and Operations
Jean Williamson, Health Benefits, Policy and Planning

1. Sunshine Act Statement:  The Sunshine Act Statement and the Executive Session Resolution were read by Florence Sheppard.  

2. Roll Call: Ms. Sheppard took the roll call:  11 present; 1 absent (McMonagle). 

3. Minutes:  Committee member Kreisberg suggested a revision on page 3, #5 to indicate that the motion received 6 votes in favor but not enough votes for passage.  Committee member McKenna made a motion to approve the minutes as revised.  Committee member Kreisberg seconded the motion. Approved (10: 1: 0 Chairperson Egea voted nay). 

There was a brief discussion regarding the Agenda and it was agreed that #5, Proposal Regarding Healthcare should be removed. There were no other changes or additions.

4. Continuation of Employer Group Waiver (EGWP) Discussion and Committee’s request for information from Aon Hewitt concerning Retiree Prescription Drug Copayments:  Susan Marsh gave a brief overview of a document, EGWP Plus Wrap Copay Reductions, as requested by the Committee at the previous meeting.  Committee member McKenna expressed concern that savings derived from switching to EGWP Plus Wrap would be given to those who don’t pay for health coverage in retirement and not to the taxpayers.  Several Committee members responded that compensation for public employees is heavily weighted towards retirement.  Committee member Larkins expressed concern about increasing the costs of the plan prior to realizing savings. Committee member Kreisberg asked Aon Hewitt how confident they were with the amount of the projected savings.  Ed Fox, Aon Hewitt, responded that both Aon Hewitt and Medco modelled the claims to derive projected savings and they both estimated between $80 - $90 million, assuming the population doesn’t change and the federal government doesn’t change the program. Chairperson Egea asked the percent of confidence Aon Hewitt has with the projected savings and Ms. Marsh replied 80 percent,. 

There was a discussion concerning the limitations of the Segal Survey and the absence of reliable data for retiree health care costs. Medco representatives Angela Pearson, Laura Carlson and Bhavesh Modi gave a short presentation concerning the member experience with prior authorizations under EGWP.  Committee member Keefe asked if a customer survey could be conducted six – nine months into the program.  Chairperson Egea requested Aon Hewitt prepare another version of the document with no savings allocated to reduce copayments and a third scenario where EGWP Plus Wrap is not implemented.   Ms. Marsh said if the Committee doesn’t make benefit changes, normally the copayments would go up.  Committee member Larkins suggested another scenario that entailed freezing copayments at the current level.  Chairperson Egea also asked for a plan on how to share the risk. She also stated that a decision whether or not to implement EGWP Plus Wrap would need to be made at the next meeting. 

5. Proposal Regarding Healthcare: removed from the agenda.

6. Committee’s request for benefit design options from Aon Hewitt report including associated premium: Susan Marsh gave a brief summary of a chart “Illustrative Plan Design Alternatives”.  Committee member Constable asked for the total annual premium and the amounts were provided.   There was discussion concerning if ideas could be categorized by changes which could be made in the short term and those which could be made in the long term. There was also discussion about cost containment initiatives versus cost shifting to employees. Committee member Rosenstein expressed concern about providing quality health care and stated a broad discussion is needed. Committee member Keefe made a request to Aon Hewitt to provide what the SHBP is doing to contain costs. He asked how risks are identified currently and if a common risk pool or multiple pools were used. He expressed concern that a High Deductible Health Plan might attract only healthy members. 

Some of the topics raised by various Committee members included the following: making changes to increase the generic fill rate, medical homes, wellness programs, bulk purchasing of prescription drugs, chronic diseases, obesity and the inflation of health care costs. It was decided that specific ideas/proposals should be sent to the secretary, Ms. Sheppard, who would send them to Aon Hewitt.  Committee member Constable asked when there would be a vote to adopt plans. There was a brief discussion concerning open enrollment.

There a brief discussion of the request for information and the Division agreed to forward the public information that was available.

7. An agenda was set for the next meeting that included EGWP, the Request for Information, Plan Options and High Deductible Health Plans (HDHPs).

Committee member Constable made a motion to adjourn and it was seconded by Committee member Larkins. All voted in favor. The meeting ended at 3:34.

  Respectfully submitted,
 

 

 

  Florence J. Sheppard
Secretary
SHBP Plan Design Committee


Meeting #4 Minutes
August 17, 2011, 1:00 PM
State Health Benefits Program (SHBP) Plan Design Committee

Adequate notice of this meeting was provided and filed with and prominently posted in the offices of the Secretary of State. The meeting notice was mailed to the Secretary of State, Star Ledger and the Trenton Times on August 11, 2011. The meeting of the SHBP Plan Design Committee was called to order on Wednesday, August 17, 2011 at 2:07 PM by Co-chairperson Keefe. The meeting was held at the CWA Headquarters, 3rd Floor Training Room, 102 South Warren Street, Trenton, New Jersey, and was attended by the following members of the Committee, Representatives from Aon Hewitt and Division staff:

Richard Constable, Deputy Commissioner, Department of Labor
Regina Egea, Chief of Staff, Office of the Treasurer
John Hutchison, Senior Policy Advisor, Department of Environmental Protection
David Jones, President, STFA
Jeff Keefe, AAUP-AFT
Ken Kobylowski, Chief of Staff, Department of Banking & Insurance
Steven Kreisberg, Director of Collective Bargaining and Health Care Policy/AFSCME –
Marc Larkins, Chief Executive Officer, Schools Development Authority
Kevin Lyons, NJ State PBA
Charles McKenna, Director of the Office of Homeland Security & Preparedness
Brian McMonagle, NJFMBA
Hetty Rosenstein, New Jersey Area Director, CWA/District 1

Aon Hewitt:
Ed Fox
James Christ
Susan Marsh
Mike Morfe

Rubin Weiner, Deputy Attorney General
Florence Sheppard, Secretary
David Pointer, Manager, Policy, Planning and Operations

Sunshine Act Statement: The Sunshine Act Statement and the Executive Session Resolution were read by Florence Sheppard.  

Roll Call: Ms. Sheppard took the roll call: All were present.

There was a brief discussion regarding the Agenda and it was agreed to begin discussions with three plan design options. There were no other changes or additions.

Aon Hewitt representatives made a presentation based on the handout entitled, “Illustrative Plan Design Alternatives”. Committee member Kreisberg asked questions concerning the buy down plan and copays. Susan Marsh of Aon Hewitt explained that in the buy down plan there were no copays and members paid coinsurance after paying a deductible up to the out of pocket maximum. Committee member Rosenstein asked about family coverage under that plan and was told that family deductibles and out of pocket maximums were twice those outlined on the chart on page 1. There was also discussion concerning therapy limits. Aon Hewitt was asked to provide details concerning the possibilities of allowing exceptions after the 30 day limit were achieved. Aon Hewitt was also asked to provide comparative data on the current plans’ utilization to determine high therapy utilization. Aon Hewitt was asked to provide local government plan design costs on page 4 of the handout.

Aon led a detailed discussion on High Deductible Health Plan Options.     

Questions arose concerning the timing needed to approve an EGWP Plus Wrap design and Co-chairperson Egea told the Committee that Medco had agreed to allow the Committee another week to make their decision. Committee member Rosenstein handed out a proposal concerning an EGWP plan design. Ms. Rosenstein made a motion to approve EGWP Plus Wrap with retiree prescription drug copays remaining at 2011 levels except for mail order copays for generics which would be lowered to $5.00; with an independent review after six months; with assistance to members regarding prior authorizations ; and with a caveat that the plan design would remain in place as long as there were cost savings. Committee member McMonagle seconded the motion. Committee member McKenna made a motion to table the EGWP proposal and Committee member Constable seconded.  All voted in favor of Mr. McKenna’s motion to table the proposal.

Co-chairperson Keefe began a discussion of next week’s agenda. It was decided that EGWP, Health Plan Options, and the labor representatives Request for Information be included on the agenda. It was also agreed that the meeting would be three hours long and end at 4:00 PM.

Committee member Jones made a motion to adjourn and it was seconded by Committee member McKenna. All voted in favor. The meeting ended at 3:33.

  Respectfully submitted,
 

 

 

  Florence J. Sheppard
Secretary
SHBP Plan Design Committee

 


Meeting #5 — Minutes
August 25, 2011, 1:00 PM
State Health Benefits Program (SHBP) Plan Design Committee

Adequate notice of this meeting was provided and filed with and prominently posted in the offices of the Secretary of State. The meeting notice was mailed to the Secretary of State, Star Ledger and the Trenton Times on August 18, 2011. The meeting of the SHBP Plan Design Committee was called to order on Thursday, August 25, 2011 at 1:58 PM by Co-chairperson Egea. The meeting was held at the Division of Pensions and Benefits, 50 West State Street, Trenton, New Jersey, and was attended by the following members of the Committee, Representatives from Aon Hewitt and Division staff:

Richard Constable, Deputy Commissioner, Department of Labor
Regina Egea, Chief of Staff, Office of the Treasurer
John Hutchison, Senior Policy Advisor, Department of Environmental Protection
David Jones, President, STFA (via telephone)
Jeff Keefe, AAUP-AFT
Ken Kobylowski, Chief of Staff, Department of Banking & Insurance (via telephone)
Steven Kreisberg, Director of Collective Bargaining and Health Care Policy/AFSCME –
Kevin Lyons, NJ State PBA
Charles McKenna, Director of the Office of Homeland Security & Preparedness
Brian McMonagle, NJFMBA
Hetty Rosenstein, New Jersey Area Director, CWA/District 1

Absent:  Marc Larkins, Chief Executive Officer, Schools Development Authority (Joined at 3:40 via phone for a brief period.)  

Aon Hewitt:
Ed Fox, Senior Vice President
James Christ, Vice President
Susan Marsh, Vice President
Mike Morfe, Senior Vice President

Rubin Weiner, Deputy Attorney General
Diane Weeden, Deputy Attorney General
Janice Nelson, Acting Secretary
Florence Sheppard, Secretary (via telephone)
Jean Williamson, Division of Pensions and Benefits

Sunshine Act Statement: The Sunshine Act Statement and the Executive Session Resolution were read by Janice Nelson.  

Roll Call: Ms. Nelson took the roll call: All were present except for Marc Larkins.

Committee member Constable made a motion to accept the minutes of August 9 and August 17, 2011.  Committee member McKenna seconded the motion. Approved (10: 0: 1, Committee member Lyons abstained).

Chairperson Egea handed out a draft resolution that she said could be used as a tool and completed as discussions took place. There was a short break, and the meeting resumed at 2:16.

Committee member Rosenstein noted there seems to be a sharp increase in the proposed rates for Parent/Child(ren) level of coverage and she expressed concern for single mothers. Susan Marsh, Aon Hewitt, explained that there was an increase due to a change in the tier factor used to calculate the rate. The tier factor changed as follows:  Parent/Child(ren) increased from 1.40 to 1.75 times the Single rate; Member/Spouse decreased from 2.25 to 2.00 times the Single rate and Family remained the same at 2.5 times the Single rate.  Ms. Marsh emphasized that the rates are preliminary; they are not final.  She also stated the proposed rates reflect the actual experience of Parent/Child(ren) coverage.

Chairperson Egea directed the Committee’s attention back to the agenda.  Committee member Rosenstein said there was a motion on the floor regarding EGWP from the last meeting and called for a vote on the motion.  Ms. Nelson read the motion from the minutes of August 17, 2011:  “a motion to approve EGWP Plus Wrap with retiree prescription drug copays remaining at 2011 levels except for the mail order copay for generics which would be lowered to $5.00; with an independent review after six months; with assistance to members regarding prior authorizations; and with a caveat that the plan design would remain in place as long as there were cost savings”.  Committee member McMonagle seconded the motion.  There was discussion that there had been an amendment to strike the last part of the motion “and with a caveat that the plan design would remain in place as long as there were cost savings” and it was, therefore, struck from the motion. There was also discussion concerning voting on all actions at once versus voting on separate motions. Ms. Nelson took a roll call vote and the motion failed to receive enough votes to carry the motion (6: 5: 0; Committee members Constable, Egea, Hutchison, Kobylowski and McKenna voted nay).

Health Plan Options: Chairperson Egea asked the Committee to go to Page 1 of the document “Plan Design and Cost Summaries” dated August 25, 2011 and noted that Plan B1 and C1 were added.  Committee member Rosenstein noted the Active Employee Prescription Drug Plan tiers were mislabelled. The three tiers are: Generic, Brand (without a Generic) and Brand (with a Generic). Committee member Rosenstein asked if the “Possible Plan Wide Changes” listed at the bottom of the page, i.e. OON, Therapy Limits, etc. were in or out. Chairperson Egea said there were no visit limits.  There was some discussion concerning the plan designs and cost savings. Ms. Marsh suggested that there should be at least a 5% cost differential between plans offered to employees.  She also gave a brief explanation of how adverse selection could occur among plans. The discussion moved to Page 3 of the document which was for retiree plans. Ms. Marsh noted that the three tiers in the prescription drug plan for retirees are Generic, Preferred and Non-Preferred. 

The discussion turned to Page 4, High Deductible Health Plans (HDHPs). Committee member Kreisberg noted that HDHP.5 and HDHP1 had no employer funding in the Health Savings Account (HSA) but the employee will be able to contribute to the HSA. Chairperson Egea stated the State/Local Employer would pay the administrative costs of the HSA. A discussion ensued on whether the current medical vendors could offer a HDHP while maintaining the status quo (Horizon under the PPO model and Aetna and CIGNA under a HMO model). Ed Fox, Aon Hewitt, raised an issue regarding the HMO platforms that are utilized by Aetna and CIGNA. They may need to use a different platform for a HDHP.  Committee member Rosenstein asked Aon Hewitt how many members would be expected to enroll in a HDHP.  Ms. Marsh responded less than 2%. Chairperson Egea stated HDHP1.5 is limited risk for the employee and HDHP.5 provides a low cost option. There was some discussion concerning how the HSA amount of $300 would be allocated: $300 available to the member on the first of the year or 1/12th of that amount each month. It was also noted that employees will be able to contribute to the HSA through payroll deductions.   

Chairperson Egea made a motion to approve the implementation of EGWP with Wrap, adopt the plans as described on Pages 1 – 3 (with the labels corrected for the prescription drug plan tiers) not including Plan B2, and adopt HDHP.5 and HDHP1.5 on Page 4. Committee member McKenna seconded the motion.  Committee member Keefe raised the issue of risk pools. Chairperson Egea read an amendment to paragraph 12 on Page 8 of the Draft Resolution as follows: “provided, however, that no plan shall be offered for any plan year commencing Plan Year 2012 through Plan Year 2015 without further Committee action, if the participants in such plan are, by action of the State Health Benefits Commission, placed in a risk pool separate from the risk pools for participants in a plan that existed in Plan Year 2011”. Chairperson Egea asked that the meeting reconvene at 3:50 following a break. 

The meeting reconvened at 4:55. Committee member Rosenstein made a motion to amend the motion on the floor to eliminate both Plan C1 and C2. Committee member McMonagle seconded the motion.  A discussion ensued concerning how the inclusion of Plans C1 and C2 would raise premiums for police and firemen retirees who are enrolled under Chapter 330, P.L.1997.  A roll call vote was taken and the motion to include the amendment was approved (6: 5: 0, Chairperson Egea and Committee members Constable, Hutchison, Kobylowski and McKenna nay). Committee member Rosenstein made a motion to amend the motion on the floor to retain the same tier factors for each contract level that were used to calculate rates in PY2011. Committee member McMonagle seconded the motion.  A roll call vote was taken and the motion to include the amendment was approved (6: 5: 0, Chairperson Egea and Committee members Constable, Hutchison, Kobylowski and McKenna nay). A roll call vote was then taken on the motion with the amendments and the motion failed to receive enough votes to carry the motion (6: 5: 0; Committee members Constable, Egea, Hutchison, Kobylowski and McKenna voted nay).

Chairperson Egea stated that she and Co-Chair Keefe would talk; no future meetings were scheduled.  Committee member Jones made a motion to adjourn and it was seconded by Committee member Lyons. All voted in favor. The meeting ended at 5:15.

  Respectfully submitted,
 

 

 

  Janice F. Nelson
Acting Secretary
SHBP Plan Design Committee

Meeting #6 -- Minutes
October 5, 2011
10:00 AM
State Health Benefits Program (SHBP) Plan Design Committee

Adequate notice of this meeting was provided and filed with and prominently posted in the offices of the Secretary of State.  The meeting notice was mailed to the Secretary of State, Star Ledger and the Trenton Times on September 30, 2011 and an item was added to the agenda on October 3, 2011.  The meeting of the SHBP Plan Design Committee was called to order on Wednesday, October 5, 2011 at 10:20 AM by Co-chairperson Keefe.  The meeting was held at the Division of Pensions and Benefits, 50 West State Street, Trenton, New Jersey, and was attended by the following members of the Committee, Representatives from Aon Hewitt and Division staff:

Richard Constable, Deputy Commissioner, Department of Labor (Arrived After Roll Call)
Regina Egea, Chief of Staff, Office of the Treasurer
John Hutchison, Senior Policy Advisor, Department of Environmental Protection
David Jones, President, STFA
Jeff Keefe, AAUP-AFT
Ken Kobylowski, Chief of Staff, Department of Banking & Insurance
Steven Kreisberg, Director of Collective Bargaining and Health Care Policy/AFSCME (via telephone)
Marc Larkins, Chief Executive Officer, Schools Development Authority (Arrived After Roll Call)
Kevin Lyons, NJ State PBA
Charles McKenna, Director of the Office of Homeland Security & Preparedness
Brian McMonagle, NJFMBA
Hetty Rosenstein, New Jersey Area Director, CWA/District 1

Ed Fox, Senior Vice President, Aon Hewitt
James Christ, Vice President, Aon Hewitt
Susan Marsh, Vice President, Aon Hewitt
Eileen Schlindwein Den Bleyker, Senior Deputy Attorney General
Diane Weeden, Deputy Attorney General
Florence Sheppard, Secretary
David Pointer, Division of Pensions and Benefits
Jean Williamson, Division of Pensions and Benefits

Sunshine Act Statement:  The Sunshine Act Statement and the Executive Session Resolution were read by Florence Sheppard.  

Roll Call: Ms. Sheppard took the roll call:  All were present except for Marc Larkins and Richard Constable, who then arrived shortly after roll call.

Committee member Lyons made a motion to accept the minutes of August 25, 2011.  Chairperson Egea seconded the motion.  Approved (12: 0: 0)

Co-Chairperson Keefe noted the Committee has been steadily making changes to the health plan options.  The changes were presented on the charts as Exhibits A – E.  There ensued a brief discussion and it was agreed to retain the names of the current plans.  Chairperson Egea provided an overview of the description of the health plan options and said they will be voting on the structure of the plans. The Commissions approve the rates.  Ms. Sheppard requested clarification on the headings of the columns. Discussion took place and clarification was made. Committee member Kreisberg questioned if the HDHP 1.5 out-of-network, out-of-pocket maximum listed as $7,500, which was previously $2,000 was a change or a typo. Susan Marsh, Aon Hewitt confirmed it was a typo and noted the plan design was not changed.  Chairperson Egea requested both state active and local active charts be modified. 

 The discussion moved to Exhibit C, the State Retiree plan.  Chairperson Egea stated the EGWP Plus Wrap is included.  The recommendation also included reimbursement to eligible higher income Medicare retirees for the differential in the Medicare Part D premium.  It includes holding flat the copayments for the retirees at the 2011 level, and lowering the generic mail copayment to $5. Committee member Lyons said that the Chapter 330 percentage of premium increase for coverage under Aetna Family, No Medicare, was out of line with the rest of the premium increases for other coverage levels.  Susan Marsh, Aon-Hewitt Consulting, agreed to review and to confirm the rate.  Discussion continued on Exhibit C and Exhibit D, the local government retiree plan.  

There was discussion about and a recommendation to modify Exhibit E.   The modifications were to remove the second paragraph, and add, “If the Commission fails to adopt the tiering recommendation, we have the ability to reconsider all of the plans.” Co-Chairperson Keefe said a motion has been distributed and asked Committee member Jones to make the motion, read it into the record, and then we will have a discussion, and if there are any amendments we can seek to amend it.  

Committee member Jones made the following motion for the plan design year January 2012 through December 2012:

to adopt plans for state active employees with medical cost sharing and prescription drugs co-pays as presented on Attachment A; and adopt plans for local government active employees with medical cost sharing and prescription drug copays as presented on Attachment B; and adopt plans for state retirees with medical cost sharing and prescription drug copays which incorporate EGWP Plus Wrap enhancements including reimbursing Medicare Part D eligible retirees in the same manner as Medicare Part B is reimbursed as presented on Attachment C; and adopt plans for local government retirees with medical cost sharing and prescription drug co-pays which incorporate EGWP Plus Wrap  enhancements including reimbursing Medicare Part D eligible retirees in the same manner as Medicare Part B is reimbursed as presented on attachment D; and continue existing dental plans as set forth in the dental plan with the modification to the dental expense plan for active employees as approved by the State Health Benefits Plan Commission in April 2011; Provided, however, that no plan shall be offered for any plan year commencing plan year 2012 through plan year 2015 without further Committee action if the participants in such a plan are, by action of the State Health Benefits Commission, placed in a risk pool separate from the risk pools for participants in a plan that existed in plan year 2011.   Further, the State Health Benefit Plan Design Committee recommends that the State Health Benefit Commission adopt coverage tiers as outlined in Exhibit E to minimize the impact of the adjustments on the Parent/ Child tier.  The Committee's approval of plan designs in Exhibits A, B, C and D is contingent on the Commission's adoption of the recommended tiering.   In the event the Commission fails to adopt the tiering in Exhibit E, the Committee reserves the right to reconsider its approval of the plan designs.  The prescription drug tiers will not be changed from the current program which include for state actives $3 for equal generic, $10 for brand where no equal generic is available, and $25 for brands where an equal generic is available.

There ensued a discussion concerning the arbitration award concerning Preferred Drug Step Therapy (PDST). [Committee member McKenna had another commitment and left the meeting.]  Committee member Jones asked for a second on his motion and an amendment to address PDST.  Committee member Constable seconded the motion.  Committee member Jones amended his motion and modified the last sentence to:  The Preferred Drug Step Therapy program and the prescription drug tiers will not be changed from the current program covered under the arbitration award. 

Committee member Rosenstein raised the issue of dental plans and a discussion ensued.   Ms. Sheppard clarified the change to the dental expense plan, “Continue the existing dental plans with the modification to the dental expense plan for active employees as approved by the State Health Benefits Plan Commission in April 2011”.  Committee member McMonagle moved for a request for amendment, Committee member Lyons seconded it.   A roll call vote was taken on the motion as amended and the motion passed (vote: 11: 0: 0, Committee member McKenna was absent for the vote).

Chairperson Egea made a motion to adjourn and it was seconded by Committee member Constable.  All voted in favor. The meeting ended at 11:20 AM.

  Respectfully submitted,
 

 

 

  Florence J. Sheppard
Secretary
SHBP Plan Design Committee

 

 

 
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