NEW MEXICO PUBLIC SCHOOLS INSURANCE AUTHORITY

Roswell Independent School District

1

(a) NMPSIA doesn’t care about its members

(b) NMPSIA loathes 89% member satisfaction

(c) NMPSIA staff pocketed the extra millions

(d) Bernie Madoff made us do it

(e) NMPSIA’s reserves are depleted & claim costs are up

Why the Plan Changes?

2

Self – Insured Coverage

Excess Fund Balance went from $25 million on April 30, 2008 to negative $2 million on March 30, 2009

No Premium Increases allowed in FY10 legislative budget process

Why the Plan Changes?

3

Why the Plan Changes?

$(1,500,000)$500,000

$2,500,000 $4,500,000 $6,500,000 $8,500,000

$10,500,000 $12,500,000 $14,500,000 $16,500,000 $18,500,000 $20,500,000 $22,500,000 $24,500,000 $26,500,000 $28,500,000

Apr-08

May-08

Jun-08

Jul-08

Aug-08

Sep-08

Oct-08

Nov-08

Dec-08

Jan-09

Feb-09

Mar-09

Apr-09

Revenues

Expenditures

Fund Balance

4

Blue Cross Medical: No ChangePresbyterian Medical: No ChangeUCCI Dental: No Change

Davis Vision: No ChangeThe Standard Life: No ChangeThe Standard Disability: No Change

5

Premiums October 2009

No Choice But To Downsize

6

JULY 1ST PLANCURRENT PLAN

New Introduction (Executive Director’s Letter)

New Employer Plan Matrix

Expanded Rules and Regulations Summary

New Summary of Benefits High & Low Options

New Prescription Drug Summary

New Davis Vision Summary 7

July 1, 2009 Program Guide

Copay - The predictable fixed dollar amounts you pay for certain services.

Deductible - The amount you pay for health care before the PPO begins to pay

Coinsurance - The percentage of covered charges you pay after you meet the deductible

Out-of-Pocket Maximum – The maximum amount you pay for covered services in a calendar year. (Charges above the maximum allowable fees do not apply to the out-of-pocket maximum.)

8

July 1, 2009 Program Guide

Worst Case Scenario to meet Out of Pocket

$300 Deductible

Plan pays 80% of next $12,500*(Member pays 20% or $2,500)

$2,800 Out of Pocket met ($300 + $2,500)Plan pays 100% for rest of calendar year

*This amount may be less if copays were also paid

BenefitsWhat You Pay

Preferred Provider Nonpreferred Provider

High Option Low Option High Option Low Option

PPP Office Visit(Deductible waived) $20 $25 30%

(after deductible)50%

(after deductible)

Specialist Visit(Deductible waived) $30 $35 30%

(after deductible)50%

(after deductible)

Preventive Services(PAP test, cholesterol test, immunizations, etc.)(Deductible waived)

$0 $0 30% 50%

Lab, X-Ray, and Pathology 20% 25% 30% 50%

High-Tech Radiology(MRIs, PET Scans, CT Scans) 20% 25% 30% 50%

Surgery, Outpatient $150 copay per occurrence + 20%

25% 30% 50%

Inpatient Hospital/Facility Services

$500 copay per admission + 20%

25% 30% 50%

Ambulance – emergency(Copay per trip) $30 25% $30 25%

Emergency Room 20% 25% 20% 25%

Urgent Care Facility(Deductible waived) $50 $50 30% 25%

Brief summary of benefits

The Bucket List

Copays DON’T go in the deductible bucketNeither do non-allowed charges

Deductible, coinsurance, and copays go in the out-of-pocket bucket

Deductible Bucket Out of Pocket Bucket

11

Non-Allowed Charges

Charges which are:

Not Covered, or

In Excess of Plan’s Allowable Amount when going out of network (balance billing)

12

Balance BillingApplies to Out of

Network Charges

Charge $1,000Allowed $ 800Balance $ 200

$200 does not go to deductible. Member is 100% responsible for this amount

13

High Option benefit example*An example of what the member’s responsibility could be for a medical office visit including lab and radiological services once the deductible has been met.

Billed Allowable Plan Pays

You Pay(In-Network) Notes

Office Visit $300.00 $73.00 $53.00 $20.00 Copayment (Deductible waived and not applied to deductible).

Venipuncture

  

$3.00 $2.40 .60

Coinsurance after deductible is met.

Urinalysis $4.00 $3.20 .80

Complete Blood Count  $70.00  $56.00 $14.00

Radiologic Exam/Chest X-ray

  $39.00 $31.20  $7.80

Grand Totals $300.00 $189.00 $145.80 $43.20  Note: Your OOP includes co-pays, deductibles and coinsurance .

*Please note that this is set up as an example and actual payments will vary.

High Option benefit example*A member obtains a routine physical and associated testing. Later in the year, the member suffers an injury requiring an emergency room visit. The member also sees their PPP, which includes associated lab test and a high-tech radiology test (MRI). These tests show a need for surgery, a brief hospitalization, and short-term physical therapy.

Billed Allowable Plan PaysYou Pay

(In-Network) Notes

Wellness Visit $300.00 $200.00 $200.00 $0.00 The plan pays 100% of preventive care.

ER Visit $7,000.00 $1,700.00 $300.00 Deductible

  $280.00 Coinsurance

$1,120.00 $580.00 Total you pay for the ER facility.

PPP Visit $190.00 $90.00 $70.00 $20.00 Copayment. Follow up from ER service.

Lab/X-Ray $250.00 $175.00 $140.00 $35.00 Coinsurance

MRI $2,300.00 $1,500.00 $1,200.00 $300.00 Total you pay for MRI.

Out of Pocket So Far $935.00

Hospitalization $40,000.00 $28,000.00 $26,135.00$1,865.0

0$500 Copay plus Coinsurance

Physical Therapy (x5) $2,000.00 $500.00 $500.00 $0.00 You have satisfied your out-of-pocket max.

The plan now picks you up at 100%.

Grand Totals $52,040.00 $32,165.00 $29,365.00$2,800.0

0Note: Your OOPM includes the deductible, copayments and coinsurance amounts.

*Please note that this is set up as an example and actual payments will vary.

Drug Firms' Spending on Consumer Ads Fell 8% in '08, a Rare Marketing Pullback - - spending on such ads reached a high of $4.8 billion in 2007, compared with less than $1 billion in 1997

Third tier (non-formulary) still covered, but member will pay 70% of discounted price

Formulary at nmpsia.com or catalystrx.com

Prescription Plan Changes

16

Prescription Plan ChangeLunesta or Ambien CR for

insomnia

70% of Discounted Price is $54. Member pays $54.

Generic for Ambien (zolpidem tartrate) another sleep aid,

would cost member $2.

17

Other Non-Formulary Examples

Celebrex $48naproxen $2

Vytorin $70Zetia + simvastatin $35

Cozaar $35Diovan $17

Aciphex$116

omeprazole $218

Davis Vision Changes Occupational Eyeware

option (safety or VDT glasses)

Contact lens discount of 15% for amounts over allowable

Lens 123 offers 50% savings on replacement contact lenses

19

In Closing . . .

Any More Questions?

Comments?

Thanks!

20