REEP Annual Business

Presentation

Michael S. DavisSr. Technical Analyst, Keenan & Associates

Laurena GrabertAssistant Vice President,

SETECH

Plan Performance Data

2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14

Medical 9,339 9,673 9,832 10,291 12,636 13,091 14,314 14,813 14,949 14,802 15,793 17,187

Dental 13,408 13,714 15,665 18,035 21,576 22,452 22,703 22,094 21,643 21,435 21,584 21,742

Vision 11,494 11,647 12,585 13,977 16,310 16,848 17,256 16,287 15,692 15,706 16,812 18,094

0

5,000

10,000

15,000

20,000

25,000

Average Subscribers Enrolled by Year(Medical Includes Kaiser Permanente)

Plan Performance Data

42.77%

21.40%

23.15%

3.94%

3.14%

0.30%

0.62%0.63%

3.89%

0.16%

2013-14 Medical & Prescription Drug Plan Expense Components-Only $0.05 of Every $1.00 is Spent on Administration & Consulting-

Medical Claims

Pharmacy Claims

HMO Capitation Fees

Stop-Loss Premiums

MH/EAP/SA Premiums

Disease Management

ACA Fees (est.)

Keenan Consulting Fees

Medical Admin. Fees

Pharmacy Admin. Fees

Plan Performance Data

2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14PEPM Avg. Funding $526.74 $580.59 $628.60 $668.55 $715.88 $774.22 $806.18 $821.40 $886.46 $971.70 $988.04 $1,044.06PEPM Med/Rx Claim Costs $450.30 $503.02 $572.71 $598.42 $593.20 $602.39 $673.35 $760.88 $769.19 $823.17 $852.04 $911.81

$0.00

$200.00

$400.00

$600.00

$800.00

$1,000.00

$1,200.00

All Combined ABC & UHC PlansPEPM Medical/Rx Claim Related Costs Versus Funding

Plan Performance Data

2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14

Clms > $10k as a % of Total Clms 58.82% 60.99% 61.33% 66.09% 63.00% 69.44% 70.90% 69.44% 70.02% 72.19%

# of Clmts as a % of Members 2.38% 2.40% 2.38% 2.77% 3.11% 3.46% 3.66% 3.79% 4.14% 4.27%

0.00%

10.00%

20.00%

30.00%

40.00%

50.00%

60.00%

70.00%

80.00%

Claims > $10,000 As Percentage of Total Claims # of Claimants > $10,000 As Percentage of Total Member Enrollment

2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14PEPM Delta Funding $87.48 $90.89 $93.36 $93.95 $98.94 $103.46 $108.51 $114.37 $119.12 $122.02 $118.29 $124.52PEPM Delta Claims $78.42 $79.68 $83.50 $86.54 $91.92 $92.98 $98.58 $103.60 $107.12 $109.59 $107.91 $105.55

$0.00

$20.00

$40.00

$60.00

$80.00

$100.00

$120.00

$140.00

Delta Dental PlansPEPM Claims Versus Funding

Plan Performance Data

Plan Performance Data

2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14PEPM MetLife Funding $92.43 $93.59 $99.20 $110.86 $109.98 $111.84 $105.88 $106.68PEPM MetLife Claims $85.13 $91.01 $92.60 $91.15

$0.00

$20.00

$40.00

$60.00

$80.00

$100.00

$120.00

$140.00

MetLife Dental PlansPEPM Claims Versus Funding

Plan Performance Data

2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14PEPM MES Funding $12.36 $12.35 $11.93 $12.80 $12.85 $13.08 $13.03 $12.49 $12.51 $12.95 $14.69 $13.15PEPM MES Claims $9.36 $10.15 $9.84 $10.67 $10.04 $10.04 $9.66 $10.43 $10.62 $10.35 $11.00 $11.79

$0.00

$2.00

$4.00

$6.00

$8.00

$10.00

$12.00

$14.00

$16.00

$18.00

$20.00

Medical Eye Services Vision PlansPEPM Claims Versus Funding

2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14PEPM VSP Funding $13.60 $16.35 $16.20 $17.16 $17.06 $19.07 $20.22 $21.04 $21.15 $21.15 $20.50 $19.90PEPM VSP Claims $12.54 $13.02 $13.27 $14.42 $15.89 $16.73 $17.49 $17.16 $17.59 $17.19 $17.74 $19.48

$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

Vision Service Plan (VSP) PEPM Claims Versus Funding

Plan Performance Data

Plan Performance Data

• 2013-14 is projected to produce a small deficit for the medical/Rx plans

• The Delta & MetLife dental plans should produce member equity for 2013-14

• The MES & VSP vision plans are projected to produce deficits for 2013-14

• All plans are financially sound• More detailed utilization analyses will be

presented to the Board & IAC at a later date

How has REEP Performed Financially?

Plan Year 2013-2014

Laurena Grabert

Assistant Vice President, SETECH

Financial Overview as of 6/30/14

• ASSETS• Audited Beginning Assets at 6/30/13 - $30 million• Ending Assets at 06/30/14 - $29 million• Decrease in Assets - $1 million

• LIABILITIES• Audited Beginning Liabilities at 6/30/13 - $12 million• Ending Liabilities at 6/30/14 - $11 million• Decrease in Liabilities - $1 million

Positive Net Position

• Net Position, as of 06/30/2014 and 06/30/2014, remained stable at $18 million, decreased by $300 thousand in 2013/2014

• Medical, Dental, remain in a positive net position of $16 million, Vision decreased by $300 thousand in 2013/2014

• Member Deficit Reserve $2 million, as of 06/30/2014