c passed, which allowed us to go from changing the plan year. the other thing that is before you related to the plan year is the 10-county service. the charter requires this every january and we will do it again in the spring and every spring. to service that can most populated counties in the state. we were able to do that and look at what their rate was and bring this significant rates down so that our overall increase is only 3.4% increase compared to a national average of between seven and nine. i think supervisor chu summarized the remaining things. i will call on our action or to give you specific details of the highlights. -- our actuary to give you the specific details of the highlights. >> good afternoon.

i am your retained actuary and i will go with item five which is the 10-county survey. that has been completed and it has been completed and done as is specified in the charter. for calendar year -- fiscal year 2012-2013. before i say more about it, i wanted to let you know. it is on page 11 of your package. on that page, you will see that the change for the existing number of $503.94 has gone up to 522 cents -- $522.90. a 3% increase and that would be in -- a contribution that is offered by the 10 largest counties in california, excluding the city and county of san francisco.

that is on page 11. interjecting at this point as was previously shared by both parties, this is -- proposition c has been enacted. we have moved to a short plan year for -- to december 31, 2012. that was done as additional information. to closely and improve administration with a flexible spending account, streamlined processing and reduced rates. that being the case, we wanted to inform you that as was said, we will bring additional computation of the survey -- compilation of the survey.

starting january and ending december 31, 2013. the number has increased to $522.97 from $503.94 or $19.30. -- $19.03. i will be pleased to answer any questions about the 10-county service. any questions? supervisor chu: no. we called both. >> i will go over the history of what happened and give you information for item 6. the information -- ok. what we did is i worked on behalf of hhs with the direction of katharine dodd. your -- as to what the starting

point was and the outgoing -- outcome of what boat -- those negotiations were. i calculate on behalf of people who have the city plan which is yourself. the premium equivalent rates for those people, those are basically based on sound actuarial principles and reflect the anticipated costs of what we think the future claims will be and incorporate the present administrative fees. we also did a projection of the dental plan which is the plan provided for the active people. in this process as was previously discussed, we started and got to a point where because of proposition c, we got six months rates with no planned changes and that saved $8 million, $8.30 million to be more correct. we had had a series of meetings where we presented a plan

benefit change option to the health service's board and a set of benefit change options were proved that added an additional $8.70 million savings. starting from a certain point of a high overall average, we reduced that average, that impact down by $17 million in combination. with that but, i think it was said the basic information that was -- what happened for kaiser was they changed the office visit co pay and the outpatient surgery copayment. it is in the document. blue shield, there was additional changes, the copiague and outpatient and inpatient surgery and some pharmacy copays and they did change the out-of- pocket maximum period for the city plan there were no explicit benefit changes. what they did was open the access from the option ppo to the open choice ppo which did

not have a disruption but basically allows you to get a better rate at available facilities where benefits are provided. for specialty -- the added a specialty drug management component to the drugs which will allow you to manage to those drugs better and allow for a better use of those in reduced costs. this plan changes were presented and approved. as i previously said, the effect of all of these was an additional $8.70 million over the transition from a 12-month set of rates to a six-month set of rates. what they plan changes do is a line copiagues -- align copays. when we go into the next open enrollment for obey at calendar plan year stanek -- starting in

january it is not anticipated there will be no planned changes at that time. also, i i would like to -- i would like to inform you, a law was passed, as b 946 which requires that you -- it was called the autism act. all the compliance is required as july 1, 2012. all three plans, the cost impact is an additional set of services and it was determined by blue shield and our analysis for the city planner where i do the calculations that there was no need to increase the previously determined premiums. kaiser, who has the largest concentration of children, added an approximate value of $922,000 to these -- to their costs so

that was slightly increased costs. this was to be determined by was determined by the end of the renewal cycle for this shortened plan year. after all this was done, we were at the $17 million savings that i shared with you. it was decided to -- blue shield as a part of the nonprofit pledge offered two amounts of money to hhs that they could determine how it wanted to apply them and it was determined to apply a certain amount of that money to the blue shield rates and that amount of money was 5.2 -- mullah -- $5.20 million. it makes contributions for the shortened plan year. people who enrolled in blue shield and in most cases it cost

neutral, there is no change. it was -- what it does is make it for the people who stayed enrolled in blue shield board decided to enroll in blue shield, they would not see any increase in their contributions. given that there is two [unintelligible] and they had seen people leave as a result of the difference in the contribution in keyser and blue shield it was determined this was a good idea to take this one time amount of money into consideration because of its availability and apply it to the rates. and so the hope is that will help stabilize what has been a deteriorating population of people from blue shield to kaiser. for information say, you're kaiser rates are on page 12. your blue shield rates in your packet are 13. uhc is 14. dental is on pages 17 through

19. is there any questions before i continue? supervisor chu: this is an important point at something that was brought up at the health service board and was a matter we grappled with as well. this is the use of subsidies. as many of you know, we had entered into aco's accounts will care organization. at least a year ago. the point of the aco's and they work with an entity like blue shield. we're supposed to coordinate with the doctors and patients to improve the experience. so when someone is hospitalized and get this charge, is there someone to follow up and say are you making -- taking york medication to prevent re hospitalization? some of the huge increases we saw initially had a lot to do with the couple of things. there is many factors they had

toward figuring out what those rates will be but they look at what our experience was a. we have large surgery's and expensive procedures that were done for our population and that was one factor. one of the other factors is the risk pool. are we getting our different providers seeing healthier enrollments, more kids, more families being enrolled in different health plans? we saw with a price differential for blue shield and kaiser in the past year, we saw a lot of migration of families into kaiser. there is a host of reasons why people migrate. it is not always tied to what the premiums are. it has to do with the economy and a number of different factors. people were migrating to kaiser and blue shield experienced a deteriorating population and risk pool. the idea was to allow the aco's to work and apply a subsidy to allow that differential and hold

a constant so people would not deteriorate any further to allow time for the aco's. the idea is we would put in $5.20 million out of the blue shield commitment in terms of a credit to stabilize it. on a one time basis. that was very important that the health services system made. we had no interest in continuing to prop up blue shield. that is not the intention to subsidize a private insurance company. we wanted to make sure we allowed a aco -- the aco tow ork -- to work. this was meant to be a one time investment. there was $18 million, $19 million that had been remitted or given us credit from blue shield so we're not using the entire amount, only $5 million. about half of the benefit will go to the employees and half will go to the employer. the city and county will receive half of the benefits but the

employees will see half of that benefit in terms of lower premium costs. i wanted to elaborate on the reason why the health service board acted to utilize the $5.2 million to let you know this is not something we intend to do on a continual basis and guiliano with the split with the benefit is. that was a very much talked- about topic at our health service board. and so with that, -- with that. >> thank you for elaborating. i wanted to share things relative to the dental plans. we raided the dental plans and created premium equivalents rates for the self funded. as you can see on page 17, the rates for the employee rate went down relative to the others and the other rates of the e plus one and plus two went up. there is no rate change.

one thing i needed to share and that is historically, hhs has charged a composite rate or the same rate for members whether employees choose e or eplus one or eplus 2 coverage. this is effective starting july 1, 2012 in order to be compliant with imputed income requirements. hhs will discontinue charging their rental -- the dental rate and charge the tier rate which was asked to calculate for the coverage local elected by the employees are members. that is a change i wanted to make sure -- [inaudible] correctly about that. i would like to go through some ativan numbers -- aggregate

numbers. this summarizes the six month plan year. this is only an increase of a $11.6 million. when we started this exercise we were looking at $33 million. $22 million has been taken out of the till, said espy. this is a true 0.4% increase including dental and as was said earlier, that is below the national average of 7%. lastly on page 25 of your packet, it goes into the split between the $351 million in terms of how much the employer spent and how much employees spent. right now your spend is 88% as employer. and 12% or 12.1%.

87.9% and 12.1%. that is the differential between what the employee pays and what the employer pays. that number, but to numbers are $308,000,000.42000001 -- $308 million and $42 million. regarding board approval is included in your agenda for item 6. i have no other things to share with you. supervisor kim: let's go to our budget analyst's report. >> page 8 of our report, the six month cost for all the health plans is 351.3 and that includes the unified school district.

on the bottom of page 8 we point out that the audit found the health services trust fund had increased by $13.3 million or 93% compared to june 30, 2010. this would be a jan 30 of 2011. that is showing -- sean on the table on page 9 of our report. finally we point out that ms. dodd pointed out the implementation of proposition c has not resulted in a reduction of costs. we recommend you approve -- approve the ordinance that is before you. supervisor kim: -- supervisor chu: are there members of the public who wish to speak on items five or six? seeing none, public comment is

closed. colleagues? >> motion to approve these items. thank you for your great work. all your work and helping to negotiate these rates. supervisor chu: we have a motion to send items 5 and 6 forward with recommendations. thanks to the department for all your hard work. we know you'll be back in july for the next set of rates. thank you. we will do that without objection. thank you. do we have other items before us? >> that completes the agenda. supervisor chu: we are turned. -- we are adjourned.

>> good morning. are you awake? [laughter] i like to welcome everyone for coming to market is very important day for the city and its infrastructure. i am from the department of public works. our agency is responsible for the care and maintenance of the city infrastructure within the city right of way. this includes streets, sidewalks, curb ramps, and all of the connectors for

residents and visitors. we are also responsible for maintaining and insuring that our roads and right of ways are safe, accessible, and enjoyable for everyone. this all happens with incredible support that we get from our mayor, the board of supervisors, and other agencies. that includes our valued customers and community partners all working together. we have representatives from walk san francisco, the san francisco coalition, members of the local 261 who work hard with us from getting the bond pas sed, san francisco capital planning committee, the office

of the city administrator, norman kelly is here, the mayor's office of public finance, the mayor's office of disability, the san francisco planning department, others and all the staff, the public utilities commission. we have been working hard with them to make sure that we support all of the projects and that we will be ready to implement. we're here today to launch the bond program that will make a significant -- that will make significant repairs to our streets and build new streetscapes for many neighborhoods. last week, the board of supervisors unanimously approved the sale of the first round of bonds. we're very happy about that. we're getting ready to start

work. i will ask our mayor to come up and say a few words. mayor ed lee. [applause] >> you do not have to lower it that low. [laughter] thank you, everybody, for coming today. i very much enjoyed these particular events. we have worked closely to make sure our infrastructure gets done. we enjoy seeing things get started, not just good legislation, but things that are employment -- implementable. you all came to make sure that we did curb ramps, bike lanes,

pedestrian safety, to make sure the streets were more walkable. a lot of people came together for a remarkable work that reflects that if we all come with the right reasons and with less politics, we can get a lot of good stuff done. i want to note that nadia is not a the mayor's office anymore. she is at the comptroller's office. her office along with the comptroller, our 10-year capital infrastructure planning, have provided the discipline for the public to understand the message. the message is that your property taxes would not be raised if you give us a chance to start paying our streets. we have not figured out that for decades we did not invest in our infrastructure properly. this is the beginning of a new relationship with our public, one that we will carry out with our new city administrator who

will help us launch even more efforts to deliver on promises that do not raise property taxes unless it is absolutely necessary. in this case, it is not. we kept that promise with the 10-year capital plan. we will make sure these projects come in on time. that is why our city engineer is here. it is his project managers that help was so much -- help with so much dpw were to make sure the city staff work together. this is valuable money. we will not squander the opportunity the public gave us. we will start seeing 17th street it repaved. this is $4 million of the bond passed to pave streets, and do additional curb ramps, and be

consistent with the standards that we have. we will work with ed at mta to get more signaling modernization to lessen the ingestion. they really need the efficiencies of our streets to properly get everybody through. then they will have less accidents and delays. we know all of this comes together with our other utilities. puc is here because they are going to help. every time we break up the street, we will look at opportunities to see what else we can do with our sewers and water systems so that we coordinate all of this. we will use every opportunity to be smart in come on, and beneath the streets as we do the infrastructure. bge and at&t and other utilities will be coordinating with us. we want to do it right and use

the precious money. i know that rings well with our board president chiu adjuster arrived. he knows this is a precious moment. we worked on the first effort that did not succeed. it hurts when we cannot get that stuff done. we will adhere to the rigors of our 10-year capital plan brian knows how hard it is to get all of the department's and agencies together to understand what we're doing with the 10-year capital plan. there are a lot of elements. as mayor, i want you to know that this is my new desk. it is global. it will be the kind of desk that i like working at. this is the one that will get things done. it is one that you can ride a bicycle around. it is kind of a public works type looking desk.

it will evidence as we go around all these projects that the $240 million will pay for, and as we work on long-term infrastructure funding that does not increase property taxes but honors what people pay through their taxes to get stuff done in the city. i am looking forward to working on this desk for many years to come. thank you very much. [applause] >> next, i would like to introduce the supervisor who was a strong supporter of the bond. he led the charge and built many bridges. he brought many community groups together. he was there working hard with us. it is only appropriate that we launched this bond program in his district, supervisors got leaner -- supervisors go scott

wiener. >> i want to welcome you to the oldest neighborhood in san francisco. i am proud to represent it. it is about to get new road surfacing. i am very excited about that. 17th street is a major thoroughfare for cars and bikes connecting the castro close to san francisco general hospital. it is a very appropriate place to start. when we went in to the campaign , i was proud to work with a great team to pass it. there were a lot of people who said to me to go for it but it will never pass in 100 years. sometimes we failed to get it on the ballot.

in 25 years, two different bonds have failed. that is not just in san francisco but throughout the bay area. it has been a very hard thing to do a hard sell. the people of san francisco understand that we as the country have failed in maintaining our infrastructure and investing in that. we see the consequences of that with bridges and public transportation and roads. people are beginning to understand that we have to invest in our infrastructure. our roads and sidewalks are a key part of that. i am so proud of the people of san francisco for understanding that and giving us the 2/3 that we needed. my counterparts around the bay area and elected officials from other areas of the county, their jaws dropped because they have never been able to do it. it is a great thing for san