Feedback to OPEB Proposals

School Board Regular Session

December 9, 2008

Since October 28…• Focused on

– Sharing information regarding proposal– Answering questions – Gathering feedback and suggestions

• Shifting focus to– Analyzing feedback– Developing possible modifications– Determining impact of modifications

• Resulting in– Superintendent’s recommendations for Board action on

March 17

Information Rollout

• Meetings conducted November 3 – December 3– 53 employee meetings (757 total attendance)– 5 retiree meetings (509 total attendance)

• On-line information– October 28 Board presentation– Board contribution calculator– Fact Sheet (home mailing to retirees)

• Feedback mechanisms– Question/comment forms– Ask.hr e-mail box

Feedback - Active Employees• Current provisions offered at retirement

should be honored for all current employees at the time of their retirement

• Proposed rate of $30/day for cashing in unused sick leave is too low

• Employees should be able to redeem their sick leave for additional service and be able to receive payment for excess days not needed, rather than one or the other

Feedback - Active Employees• Offer choice of plans (HMO and PPO) for

new pre-65 coverage rather than PPO only

• Establish a sick leave bank to which employees could donate excess days which they could not cash in

• Increase prescription rates for active employees in order to maintain current rates for current and future retirees

Active Employee Issues

• Treatment of part-time service for determining eligibility for plan access and percentage of Board contribution

• Proposed effective date of modifications (July 1, 2009) may cause employees to retire prior to completion of current school year

Feedback - Retirees• All retirees should retain their current Board

contribution percentage and access to active employee coverage (for pre-65 retirees) based on commitment made at the time of their retirement

• Proposed contribution of $100/month for post-65 retirees is insufficient and violates commitment made to maintain their percentage of Board contribution for life

• Inequitable to place all post-65 retirees at the same $100/month Board contribution if currently receiving percentage based on sick leave returned at retirement

Feedback - Retirees

• Access to dental coverage should be maintained for lifetime of all current retirees, with current Board contribution remaining in place

• Changes to retiree benefits should only impact those who retire after the effective date of the changes

• Require active employees to contribute toward their pension, rather than NNPS making 100% of contribution, in order to provide funding to maintain current level of retiree health insurance benefits

Feedback - Retirees• Large individual medical claims of a few

retirees could cause the premiums for all pre-65 retirees to increase significantly if they are in a separate plan

• Increase of 20-30% in premiums for new pre-65 retiree plan is too drastic

• Offer choice of plans (HMO and PPO) for new pre-65 coverage rather than PPO only

Current Retiree Issue

• Significant number of retirees elected to continue dental coverage only

• Their Board contribution percent has been applied to the PPO (employee only) Board rate, rather than the dental Board rate

• Results in full payment for dental coverage

Next Steps• Develop possible modifications to original

proposal based on feedback received

• Determine impact of suggested modifications on immediate costs, as well as on unfunded liability and annual required contribution

• Report back to Board (January 2009) on impact of any suggested modifications – receive additional Board feedback

Next Steps

• Report back to Board (February 2009) with any revised recommendations based on January feedback

• Finalize recommendations for Board action on March 17