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ABOUT THE PENNSYLVANIA PUBLIC SCHOOL HEALTH CARE TRUST

ABOUT THE PENNSYLVANIA PUBLIC SCHOOL HEALTH CARE TRUST. PLAN OF HEALTH INSURANCE. BACKGROUND. Planned for years Officially constituted as non-profit organization in March 1999 Endorsed by PaFT, PSBA, PSEA, PASA, and PASBO Functions as Taft-Hartley Trust Labor/Management

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ABOUT THE PENNSYLVANIA PUBLIC SCHOOL HEALTH CARE TRUST

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  1. ABOUT THE PENNSYLVANIA PUBLIC SCHOOLHEALTH CARE TRUST PLAN OF HEALTH INSURANCE

  2. BACKGROUND • Planned for years • Officially constituted as non-profit organization in March 1999 • Endorsed by PaFT, PSBA, PSEA, PASA, and PASBO • Functions as Taft-Hartley Trust Labor/Management • Initial funding provided by Heinz Family Foundation • First Managing Director hired July 2000

  3. HOW DOES THE TRUST WORK? • Acts as the Benefit Provider • Uses panel of Participating Physicians and Hospitals • Negotiates Discounts from Providers’ Fees

  4. ORGANIZATION • Trustees: oversight responsibility • Managing Director: day to day activity responsibility • State divided into 4 regions • Western Pennsylvania (80,000) • Central Pennsylvania/Lehigh Valley (75,000) • Southeastern Pennsylvania (50,000) • Northeastern Pennsylvania (25,000) • Solicitor • Independent auditor • Access to consultants as necessary

  5. Who is Eligible? • School Districts • Intermediate Units • Vocational/Technical Schools • Community Colleges

  6. The Stakes Statewide • Over 230,000 employees/550,000 members • Approximately $800,000,000 being spent annually on health care

  7. Immediate Goals of the PPSHCT • Maintain quality health care benefits • Seek competitive advantages • Promote Labor/Management cooperation • Control cost to taxpayers

  8. Health Insurance Issues in Bargaining • Hinder the Process • Raise issues that the Parties can’t control • Force hard-line positions

  9. Typical PPSHCT Client Services • Technical • Define and monitor terms and arrangements with third party administrators • Analyze utilization trends • Generate regular insurance summaries/reports • Customer Service • Resolution of participant claim matters • Promotion of optimal labor management climate • Facilitate formation and operation of regional advisory committee • Educational/Developmental • Develop and present health care seminars and symposiums to promote health care awareness • Conduct product briefings • Consultative

  10. PPSHCT Enhanced Choice Plan • Development of Enhanced Choice Plan – a self-funded option. • Self-funding is not new. Currently 60% of all employers are in self-funded plans.

  11. What is Self-funding? • The Trust collects premiums from the employer • The Trust contacts with a third Party Administrator to pay claims • The Trustmanages risk with stop/loss insurance

  12. What Is Stop/Loss Insurance? • Limits Liability • Creation of a reserve fund • Purchase Individual Stop/loss • Purchase Aggregate Stop/loss

  13. Advantages of self-funding • Cash flow • Lower Administrative Costs • More Plan Flexibility • Better data on Utilization

  14. Health Care Strategies Inc. • Allows you to actively participate in your healthcare • Provides information about Doctors and Hospitals • Provides specific disease and condition Protocols • Provides wellness experts for proactive health care

  15. The Advantages of An Affiliation With The PPSHCT • Reduced retention/administrative fees • No carrier reserve requirement; interest on excess funds accrues to Trust • As Trust grows, need for extra funding to stabilization Fund decreases • Marketing fees minimized • Greatly expanded provider network that can be customized to meet the needs of a specific group (In and out of state) • Leveraging the numbers to obtain the best possible discounts with providers and rates with re-insurance carriers

  16. The Advantages of An Affiliation With The PPSHCT • Avoidance of network development expense • Commitment to managed care (versus managed cost) • Access to Centers of Excellence • Best health interest of members stressed • No brokerage fees built in to premium deposits • Greater flexibility to affect benefit design • Health Insurance “Off” the bargaining table • Significant resources available to clients through the Trust affiliates • Your Insurance; Your Trust – PPSHCT works for you.

  17. To Affiliate with the PPSHCT • $1,000 per district application fee plus 1% of premium on monthly basis • Commitment to Labor/Management philosophy • Authorization to receive, review, and analyze three years of utilization data • Three year commitment/execute a Participation Agreement

  18. What is Group Health Insurance? • A Large number of people paying to provide health care to those that need it • The 6% - 60% Rule Applies • Chronic and Catastrophic

  19. “There is nothing more difficult to execute, nor more dubious of success, nor more dangerous to administer than to introduce a new system of things: for he who introduces it has all who profit from the old system as his enemies, and he has only lukewarm allies in all those who might profit from the new system” Niccola Machiavelli

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