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Public Employees Benefits Board Meeting

Public Employees Benefits Board Meeting. July 18, 2000 Briefing on Long-Term Care Demutualization. Overview. Background on Demutualization Process Proposal for Board resolution. Long-Term Care Program. Legislative requirement to offer LTC program

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Public Employees Benefits Board Meeting

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  1. Public Employees Benefits Board Meeting July 18, 2000 Briefing on Long-Term Care Demutualization Washington State Health Care Authority/PEBB

  2. Overview • Background on Demutualization • Process • Proposal for Board resolution Washington State Health Care Authority/PEBB

  3. Long-Term Care Program • Legislative requirement to offer LTC program • John Hancock Financial Services selected as successful vendor • Began offering LTC program for July 1998 coverage • Over 1,800 individuals have purchased coverage Washington State Health Care Authority/PEBB

  4. Demutualization • John Hancock Financial Services - converted from a mutual insurance company to a publicly traded stock company • Mutual company owned by policy holders, like HCA • Policy holders received stock • calculated with length of time LTC plan has been in effect, total amount of premium paid, and total number of subscribers(enrolled on two key transition dates) Washington State Health Care Authority/PEBB

  5. Transfer of Stock • HCA received 79,979 shares • Premiums for LTC paid exclusively by subscribers • Most appropriate to transfer shares directly to eligible subscribers Washington State Health Care Authority/PEBB

  6. Transfer, cont. • Shares determined • Eligible subscribers determined using two key transfer dates Hancock used (December 31 and August 31) = 1,658 eligible subscribers/dependents • Shares based on total premiums paid for PEBB LTC contract; total premiums by each subscriber - as a percentage of total premium paid Washington State Health Care Authority/PEBB

  7. Transfer, cont. • To complete the transfer from HCA to subscribers • Board resolution - intent to transfer shares, authority for LTC administration • Medallion guarantee and letter of instruction • Share distribution for each subscriber Washington State Health Care Authority/PEBB

  8. Next Steps • Hancock mailed initial notification letter for us • Complete legal transfer with Board resolution and medallion guarantee • Board vote - special telephonic board meeting August 1, 2001 at 1:30 (Conference line: 360-923-2997) • Final transfer documents to Hancock’s agent (Equiserve) who will prepare individual notices and share certificates Washington State Health Care Authority/PEBB

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