2013 Benefits Briefing

Presentation to Board of RegentsNovember 15, 2012

Faculty Comp Model1 Year to 100% Market

Business Model (included)

TIR AS OF DATE 8/ 1/ 2013

Total # of Faculty 370

COST TO MINIMUM 206,352$ # of Faculty 49% Faculty receiving increase to Minimum 13.24%Average Increase 9.42%

Range Penetration 978,222$

TOTAL COST TO MARKET 1,184,574$ # of Faculty 229% Faculty receiving increase to Market 61.89%Average Increase 10.25%

2012 Faculty Salary CIP ModelSUMMARY SHEET

Year 1 to 100% Market

Staff Compensation Model1 Year to 100% Market

TIP Implementation Date 6/ 30/ 2013

Total # of STAFF 757

COST TO MINIMUM 1,094,592$ # of Staff 238% Staff receiving increase to Minimum 31.44%Average Increase 12.36%

Range Penetration 2,649,282$

TOTAL COST TO MARKET 3,743,874$ # of Staff 573% Staff receiving increase to Minimum 75.69%Average Increase 17.82%

2012-13 Staff Salary ModelSUMMARY SHEET

1 Year to 100% Market

2012-2013Operating Budget

Total Operating Budget $135,700,000– Total Personnel Budget (56.8%) $77,091,204

Note: Personnel Budget includes all salaries & fringe benefits

56.8%43.2%

Personnel Budget

Other Expendi-tures

2011-2012 Actual Salaries & Benefits by Division

Types of Benefits

• Health Insurance• Dental Insurance• Life Insurance• Vacation Days• Holidays• Sick Leave• Tuition Assistance• Fitness Center

Membership

• Retirement:– KTRS– KERS– ORP

• FICA – Medicare– Social Security

• Workers Compensation• Unemployment Insurance

2011-2012 Expense by Benefit

3 Categories of Employees

1. Hourly employee working 8 hours per day at $12.19 per hour ($25,355 annually)

2. Mid-level exempt professional employee with $50,000 annual salary

3. Senior level employee with $103,259 annual salary

Cash and Non-Cash Benefitsby Employee Category

Expense by Benefit- Hourly Employee

Expense by Benefit- Mid Level Employee

Expense by Benefit- Executive Level

Healthcare 2013

Strategy– Provide the best competitive healthcare for the

lowest premium/cost– Accomplish this by involving all employees and

dependents in becoming healthier, improving their lives and therefore reducing claims & premiums

– Focus incentives on continually improving results

Healthcare 2013

0% increase in Anthem rates for 2013– Continues a desired trend in rates indicating positive effect

of wellness.MSU annual increases National Trend

8.17% increase 2008 9.4% 6.23% increase 2009 9.2% 7.00% increase 2010 9.0% 4.36% increase 2011 9.0% 0% for 2012 8.5% 0% for 2013 7.0% est.

Healthcare 2012/13 Annual Premiums

2012 total actual premium $7,166,965 and HRA

$792,400.

2012 actual annual University premium including

$792,400 HRA, $5,518,563

Healthcare Rate Considerations for 2013

Plan 2013 University Contribution

2013 Employee Cost

2013 Total Cost

Single 396$ 178$ 574$

2-Person 508$ 353$ 861$ 465$

Family 597$ 551$ 1,148$ 752$

Single $ 385 68$ 453$

2-Person $ 482 197$ 679$ 294$

Family $ 606 299$ 905$ 520$

Single 358$ 25$ 383$

2-Person 437$ 138$ 575$ 217$

Family 552$ 214$ 766$ 408$

Blue Access 2500 (HDHP)

Blue Access 1500 (CDHP)

Blue Access 500 (POS)

Workers Compensation

Remain fully insured with KEMI (Kentucky Employers’ Mutual Insurance)

14.5% further reduction in premium for 2013– 2013 Premium $208,668– 2012 premium $243,973– 2011 premium $255,233– 2010 premium $317,715– 2009 premium $746,340

QUESTIONS?

Hourly Employee Benefit Comparison to EKU

Employer Contribution

Employee Contribution

Category Benefit MSU EKU MSU EKUCash Outlay

Insurance Health Insurance $7,272 $7,575 $3,588 $5,239Wellness Incentives $500 $0 $0 $0HRA Contribution $1,150 $0 $0 $0Dental Insurance $300 $152 $480 $809Life Insurance $39 $39 $0 $0

Retirement KERS - 23.61% $5,986 $5,986 $1,268 $1,268Legally Required Social Security - 6.2% $1,572 $1,572 $1,065 $1,065

Medicare - 1.45% $368 $368 $368 $368Workers Compensation $182 $182 $0 $0Unemployment Insurance $90 $90 $0 $0

Non-Cash OutlayPaid Leave Vacation Days $1,755 $1,950 $0 $0

Holidays $1,658 $1,560 $0 $0Sick Leave Days $1,170 $1,170 $0 $0

Other Fitness Center Membership $240 $0 $0 $180Tuition Assistance @ $276/cr $4,968 $4,575 $0 $0TOTAL $27,250 $25,119 $6,769 $8,929% of Base pay 107.47% 99.47%

Hourly EmployeeBenefit Comparison to St. Claire

Employer Contribution

Employee Contribution

Category Benefit MSU St. Claire MSU St. ClaireCash Outlay

Insurance Health Insurance $7,272 $14,100 $3,588 $3,736Wellness Incentives $500 $0 $0 $0HRA Contribution $1,150 $0 $0 $0Dental Insurance $300 $403 $480 $403Life Insurance $39 $0 $0 $192

Retirement KERS - 23.61% $5,986 $1,268 $1,268 $1,268Legally Required Social Security - 6.2% $1,572 $1,572 $1,065 $1,065

Medicare - 1.45% $368 $368 $368 $368Workers Compensation $182 $182 $0 $0Unemployment Insurance $90 $90 $0 $0

Non-Cash OutlayPaid Leave Vacation Days $1,755 27 PTO

days $2,633

$0 $0Holidays $1,658 $0 $0Sick Leave Days $1,170 $0 $0

Other Fitness Center Membership $240 $0 $0 $0Tuition Assistance @ $276/cr $4,968 $2,763 $0 $0TOTAL $27,250 $23,378 $6,769 $7,032% of Base pay 107.47% 92.20%

Retirement System Employer Rates with Projections

KTRS KERS (Non-Hazardous) KERS (Hazardous)

2006/07 13.84% 7.75% 22.00%

2007/08 13.84% 8.50% 24.25%

2008/09 14.84% 10.01% 24.35%

2009/10 14.84% 11.61% 24.69%

2010/11 14.84% 16.98% 26.12%

2011/12 14.84% 19.82% 28.98%

2012/13 14.84% 23.61% 35.89%

2013/14 14.84% 32.31% 49.12%

2014/15 14.84% 41.00% 62.32%

Retirement System Employer Rates with Projections

Actual Projected

Full-Time Faculty and Staff by Gender

Faculty Staff Total

Female 190 51% 449 57% 639 55%

Male 179 49% 334 43% 513 45%

Total 369 100% 783 100% 1,152 100%

Employee Demographics

Category Total # of EmployeesFull-Time Employees 1,152

Faculty 369

Staff 783

Salary Employees 802

Hourly Employees 350

1,950 Hour Positions 158

2,080 Hour Positions 185

Salary Under $50,000 775

KERS 419

KTRS 775

KERS Employees

KERS Description Total # Employees

Employee Contribution

Employer Contribution

KERS Non-Hazardous 316 5% 23.61%

KERS Non-Hazardous on/after 09/01/08

85 6% 23.61%

KERS Hazardous 14 8% 29.79%

KERS Hazardous Retiree 1 29.79%

KERS Non-Hazardous Retiree

3 23.61%

KTRS Employees

KTRS Description Total # Employees

Employee Contribution

Employer Contribution

KTRS 422 6.84% 14.52%

KTRS on/after 07/01/08 117 7.16% 14.84%

KTRS Retiree 35 16.10%

KTRS ORP 201 5.10%