1 NEW MEXICO PUBLIC SCHOOLS INSURANCE AUTHORITY Benefits

1 NEW MEXICO PUBLIC SCHOOLS INSURANCE AUTHORITY Benefits Program April 2008

2 COVERED EMPLOYEES

3 OVERVIEW • $276 Million Expected Claims • Claim reserves are fully funded • Excess Cash Balance

4 BIG BID RESULTS Joint Purchasing under the Consolidated Purchasing Act NMPSIA, NMRHCA, State of New Mexico, APS Quotes for Medical, Health Management, Dental, and Vision

5 BIG BID RESULTS Collectively, nearly 200, 000 members Bid Analysis by staff, procurement manager and each agency’s consultants Self-Insured administrative service Only (ASO) fees and insured quotes

6 MEDICAL Finalists: BCBS, Lovelace, Presbyterian, Cigna, United Health. Care, Award: BCBS, Presbyterian

7 DENTAL Finalists: Delta Dental NM United Concordia Award: United Concordia

8 VISION Finalists: Davis Vision, Spectera, Vision Service Plan Award: Davis Vision

9 PREMIUM INCREASES 10/08 Blue Cross Medical: Presbyterian Medical: UCCI Dental: +5. 5% +9. 9% Davis Vision: The Standard Life: The Standard LTD: No Change

10 APPLES + ORANGES • 2% of Salary is greater than 9. 9% of insurance • 3% of Salary is greater than 9. 9% of insurance • 9. 9% increase on employee’s portion for single dental is $. 90 per month

11 APPLES + ORANGES SALARY INCREASE INSURANCE INCREASE • 3% ANNUAL INCREASE ON $13, 000 = $390 • INSURANCE INCREASE = $72. . . $281 • 2% ANNUAL INCREASE ON $42, 000 = $900 • INSURANCE INCREASE = $ 115. . . $449

12 MEDICAL REVENUE VS. MEDICAL/RX CLAIMS(in millions)

13 AVERAGE MEDICAL INCREASE

14 BENEFITS FUND BALANCE (in millions)

15 USE OF FUND BALANCE • Reduced 2006 increase from 11. 5% to 8. 75% • Postponed 2007 7. 4% from October 2007 to February 2008 • Enhanced plan benefits

16 ENHANCED PLAN BENEFITS • PCP Copay $15 • Physical Therapy Copay $20 • Orthodontia maximum to $1, 500 • Improved dental plan periodontal benefit • $2/$5 Generic drug Copay • $0 Copay formulary diabetic supplies, insulin, and oral medications

17 BCBS HIGH OPTION MONTHLY IMPACT Single Two Party Family 02/08 +7. 4% Rates $434. 50 $826. 32 $1, 103. 66 10/08 +5. 5% Rates $458. 40 $871. 78 $1, 164. 36 MONTHLY INCREASE $23. 90 $45. 46 $60. 70

18 BCBS EMPLOYEE IMPACT MONTHLY IMPACT Single Two Party Family INCREASE (EMPLOYER+ EE) $23. 90 $45. 46 $60. 70 MONTHLY INCREASE IF EE @ 40% $9. 56 $18. 18 $24. 28 MONTHLY INCREASE IF EE @ 25% $5. 98 $11. 37 $15. 18

19 PRESBYTERIAN HIGH OPTION MONTHLY IMPACT Single Two Party Family 02/08 +7. 4% Rates $337. 30 $708. 26 $944. 42 10/08 +9. 9% Rates $370. 70 $778. 38 $1, 037. 92 MONTHLY INCREASE $33. 40 $93. 50 $70. 12

20 PRESBYTERIAN EMPLOYEE IMPACT MONTHLY IMPACT Single Two Party Family INCREASE (EMPLOYER+ EE) $33. 40 $70. 12 $93. 50 MONTHLY INCREASE IF EE @ 40% $13. 36 $28. 05 $37. 40 MONTHLY INCREASE IF EE @ 25% $8. 35 $23. 38 $17. 53

21 UNITED CONCORDIA (UCCI) DENTAL MONTHLY IMPACT Single Two Party Family 02/08 0% Rates $22. 60 $43. 04 $67. 64 10/08 +9. 9% Rates $24. 84 $47. 30 $74. 34 MONTHLY INCREASE $2. 24 $4. 26 $6. 70

22 UCCI EMPLOYEE IMPACT MONTHLY IMPACT Single Two Party Family INCREASE (EMPLOYER+ EE) $2. 24 $4. 26 $6. 70 MONTHLY INCREASE IF EE @ 40% $. 90 $1. 70 $2. 68 MONTHLY INCREASE IF EE @ 25% $. 56 $1. 07 $1. 68

23 UPDATE FROM THE STANDARD • FICA, 941, and W-2 reporting done by The Standard • Basic Life Accelerated Benefit can equal 100% (25% specified disease + 75% terminal illness) • Survey on Section 125 and each school’s policy on when coverage terminates

24 IN CLOSING. . . Thanks! Questions? Comments?