>> wauz you please rise to resite the pledge of america and to the republic for which it stands, one nation, under god, indivisible, with liberty and justice for all. >> you may be seated. we're going to take a step into

brave new territory today assuming the prerogative of the chair we're going to do the following we're going to under take all of the discussion items on the agenda for the regular meeting until we have a quorum present we will not be dealing with the rates and benefits portion of the committee as a whole. that way we can get part of our business done rather than kept in suspenders while trying to get a quorum we can at least do what we can. with that being said i will call for the roll call >> roll call. president scott present vice president lim excused. breslin here. >> supervisor farrell excused. commissioner ferrigno expected.

commissioner sass >> here. >> thank you. >> it's an action item calling for the approval of the previous minutes meeting we will not under take to do that at this time i would rather go to item two. >> item two discussion item. general public comment with the board's jurisdiction not appearing on today's agenda. >> is there any public comment on any matter under our jurisdiction that is not on today's agenda? hearing none we will proceed to our regular meeting matters. item a eight >> discussion item president's report president scott >> there are a couple of items i want to bring to the board's attention consistent with the recommendation of the governance

committee on education for members of this board i have been approved to attend a trustees institute which will be sponsored by the international foundation benefits plans all memberses of this board are members of this organization. the institute is going to take place beginning this sunday add run through wednesday of next week. i will report on some of the content of that meeting subsequent board meeting i have also with the direct r engaged in a series of e-mail exchanges regarding the current vacancy on the board we must have a position as a member of this board as you recall those of you who keep track of these matters dr. shalne had to resign earlier this year we have been activity

seeking replacement we have found a person that is a qualified and made a recommendation to the mayor's office we have been advised as recently as this morning there wasn't sufficient time for this person to be vetted interviewed and screened. my public mrooeding to the mayor's office based on my private communication with them they will expeditiously under take that between now and the next session we have been handicapped this entire year by board vacant positions for a variety of reason tell us it has not entirely hampered our work in this particular instance today when we have critical matters it has been and will be a hamper to our work going forward i put that on the public record i'm sure it will be given

the due consideration by the powers that be. i also would like to take this opportunity to formally and in person welcome commissioner sass. i did so upon your election or selection and appointment commissior sass i would like to do this again publicly today and invite you to make any comment you care to at this time. >> thank you. i really appreciate the welcome it's really nice to look out and see so many familiar faces. for those of you that don't know me i spent my last ten years at the chief finance officer for the department of public health retired in 2011 and came back in 2013 to be the inter rim finance direct e for the health services system i have worked aon and neill bochar. i was involved with the

recruitment and cfo pam levin i have worked with all of the commissioners with lanie and catherine dodd i have known 15 years perhaps more dating back to my first day at the department of public health it's a real pleasure for me to be here i'm hoping i can bring my experience with health care finance combined with my recent experience with hss to make a contribution to this board thank you again for the welcome >> thank you i would invite any other commissioners to make comments if they have them. hearing none is there any public comment on those comments? seeing none we will proceed. also i have been cosignatory to a resolution commending jane cross man-mir ran da upon here retirement from the retirement

from the health service system she has been a long term employee some 23 years, i'm sure her con transcribe ewed. contributions to the system will be missed i want to publicly acknowledge and thank her her for here service to her fellow employees sh and to the city and county of san francisco. with that i will make other commentary as we go. item nine >> discussion item director's report director dodd >> thank you commissioners and members you have before you my report. i wanted to start by pointing out. i listened carefully to the board television recording and i will when we go approve the minutes that ask the minutes be

changed. there is a point as which commissioner breslin asked our actuary the majority of money the surplus money from the stabilization fund came from the retirees he asked yes i asked him to go back and look in fact 82% of that money in between 13 came from the employees with 4% coming with akive employees and 10% from retirees and 4% from medicare retirees similarly with 20 foyer teen come -- 5% coming from medicare retirees of the stabilization fund the early retirees are paying the largest premium than haecing the largest contribution to that

stabilization fund. i also commissioner breslin asked for a break down in the membership of blue shield in terms of how many members had the were in sciu and and had 806090 coverage a break down is in the board packet we're trying to determine who is effected the most. and the blue shield has covered by sciu where it's 100%ed. 839383 has 2000 -- this is a good reference for the break down membership and city plan in terms of where the active members where the city plan are then at the bottom marina break

down manager wrote down the retirees and early retirees good information sorry we didn't have it last month i wanted to acknowledge -- j >> i wanted to ask you about that. where this excess comes from. my understanding is you said the city plan started to generate surplus funds in 2013 when the medicare retirees the egg wip program went into effect. so most of them please >> please approach the podium thank you. >> the surplus doesn't come from the proceed yums it comes from the loss ratio right? that is my understanding in february they did a preliminary rate on loss ratio since there is 5,368 medicare retirees and they were like 72% loss ratio.

there is like about 7 million >> so awould you bring your microphone to you? >> when the money goes in the trust it goes to the members right? not to the city. >> well i can't really clearly answer that question. >> that would be a city attorney question >> we have been down this road before >> the clarification being made today is that the premiums go into the trust. the excess moneys that were generated are all because the premiums that were emitted on behalf of the retirees were excessive so the employer paid the premiums we paid the bills so how much of the whole premium was paid by employer how much of the full premium was paid by the

retirees? so the point of clarification is if i remit money and i only need half of it i as an employer put the money in the pool. so technically speaking that money which is being used on behalf of the members was remitted by the employers that is the point of clarification in dr. dodd's statement today is it true that most of the people are retirees? yes but the premium is remitted by the employers whoever that may be. >> when you talk about the loss ratio and how well the plan was doing >> absolutely the loss ratio is the full premium as the denominator and the numerator is the expense which is the egg wip premium when you take that the loss ratio is very low that means that the plan is technically over funded so the employer paid too much into the trust for that program does that

clarify >> somewhat. how much of this money went back to the employer? >> actually none of the money goes back to the employers it's all going back to members >> when it was 4 million i saw back in the previous -- >> what we have done for this rate path i can can clearly state that the money is being used on behalf of the members. when we did the buy-down last month. >> that is fine. >> that is sufficient? any comments? >> i don't have the information from the last meeting there say statement there that 1 million or something went back to the employers and 4 million went back to the members. >> when i have last -- >> it was the may presentation. and that was not the regular

reserve that is the extra reserve. 5 5 million yours respectfully >> yeah the 5 million. i want to be clear unless you want to move on >> no i don't want to move on unless we got further clarification about this point. our controller? yes. controller? >> with the buy down there was a savings roughly like 2.1 million. of that some of that was employer savings and some of it is -- so the city doesn't have to pay as much into the premiums for the participants for the members and some of it was for the employees or the members the city got some of the savings and the members got some of the savings, and that's what you are thinking about i think.

>> all right. is there further clarification? >> i didn't bring it -- >> all right. >> 4,000,002 something went to the members and one something went to the employer. it should be in may. >> okay hold on just a second. >> while you are searching for that piece of information i will turn to the attorney and ask a broadly asked or counsel he doesn't have to answer this question today i always give you a header you know that counsel. it is immensely confusing to me as a comparatively new person on the city government scene in terms of health plans and coverage and sources of funds, and so forth. my broad understanding is that when moneys come into the trust

no matter their source they're under the jurisdiction of the trust unless they're specifically designated to a purpose. and it's not like i put a penny in as a member therefore i ought to get a penny out. i don't think it works that way. you can tell me differently. some things may come to the trust that have very designated purposes we can by policy reserve and act on those purposes regardless of where the money came from i blaef but you can tell me if i'm wrong if that isn't correct at a future meeting i would like to have you expound on that point about sources of funds and policy parameters if you will that we as a board would have regarding this. i think the intent is we have tried to look at rates and sub acid seas at least during my

tenure to support those groups from whom the sources of funds have come. and we have done that broadly but if we try to get into some level of precision about exactly how many pennies came in one point to another i think we're going to find ourselves in a mess here there say broader principle of trying to do support for certain membership categories that i think we have broadly adhered here to. it may mean in some cases we're quote cross subsidizing one group for another but the idea of sub acid sea is the principle if we can can in deed mitigate the cost increase premiums to members be they actives early retirees or regular retirees that is the broad operating principle i thought we were trying to act on -- i will look

to you to clarify that when counsel comes back with a response to the broader question if i didn't say that precisely enough i will put it in writing to you i'm trying to get at the business of is ownership retained in the trust because of sources of funds is that the case >> that's what i would like to know once the money goes into the trust who does it belong to? >> if you have the answer to that you can answer if you would like to research it a bit you certainly have liberty to do that >> at some point -- is this mic on? >> no. >> hello? okay i think it's a good idea to set this as a discussion item for a future session i think in a high level what you are saying is generally accurate that this board is not thought to trace specific funds from specific 41ed groups and saying this

money came from this source therefore it has to fund that source the purposes are set in the charter 12.203 where it says in the health service system fund should be the trust fund in accordance with the provisions of this charter solely for the benefit for the active and retired members of the service system and their covered dependents >> by my lights and reading i don't take that answer as being definitive we're here for the mutual benefit of the members of this plans that happens to be city employees or community college or school district employees when we deviate from that i think we're going to get in deep yogurt >> you have to make decisions with how you set term and rates employee + 1 and 2 decisions with retirees and actives and

you have this general trust purpose to make decisions for the best interest of both the active and retired members at a fairly high level we can get into some of the details as to your question i think your question is once the money goes into the trust that is the fiduciary >> that is my question -- >> and i think your question to the extent there was confusion i think we were talking about what was happen in a future year in terms of this rate buy back and how that effects next year >> that is different >> maybe that's where the confusion is coming >> i pause at that for future meeting and would like to target that to happen before we begin the next benefit renewal cycle so that gives us the fall to come back to this point but it's one worth making all right.

executive director dodd? >> thanks. i will point out from a personnel perspective that both stephanie fisher who is here today our wellness manager and pamela levin our chief financial officer they completed the leadership trains by the department of human resources and executives association that's an accomplishment in and of itself we filled some of our positions we still have a couple vacant. we're finishing up interviews tomorrow on the member services manager hopefully at the next meeting you will be meeting a new member services manager when you look at the graphs you will noticed that the delinquencies increased that is due to increased retirement so that when someone leaves active

employee and goes to retirement their premium goes to delinquent. so it's not as these people will be terminated the first deduction will occur from their pension checks and they will have continuous coverage i wanted to let you know that. we have begun to load the historic eligible file into the data base which say long time and coming and exciting xhoon indications wise besides open enrollment communication rose mary will be developing she's also been working on a lot of wellness projects including concepts for the diabetes prevention study we're doing with kaiser r that you voted on some time ago. in terms of finance. we worked on rates and benefits

but i think probably the significant thing you can listen for when pamela gives her report is the budget i have to stay out of all the things that are frustrating in this job the budget process is the greatest. gregg a former cfo is hodding his head. we balance the budget the mayor's office generously did not take any cuts from us this year then we go to the board of supervisors and they cut from each budget so they can put together a little pot to give back to the supervisorers so they can fund special things in their districts pamela has worked and continued to work cooperatively with the budget analysis staff we =ed and skwooeked out little pots here

and there they will have a better understanding of exactly what our budget cuts will be tomorrow. the first hearing is on monday. i don't anticipate us being in agreement by monday it's a frustrating process i will leave it at that otherwise i will say too much. in terms of wellness i don't want to really draw your attention to an abbreviated report from the stephanie well being assessment my highlights are 22%over the employees participated which is very high for an initial well being assessment. we scored five points higher in general than the rest of california and seven points

higher in well being in the united states we're doing better in terms of basic access which is attributed to the health service system and board we scored higher in termed of life evaluation and work environment the areas lower are emotional and physical health and health behaviors. yet another reason we need a strong employee assistance program that our physical activity works needs to continue to work and the healthy behavior classes that happen are so important. so we justified the activities we're already under taking i want to highlight commissioner lim who par piss tated in the shape up team. the hss soul team and a shout

out to 40 members who walked almost 5,000 miles sh and thank our transcription nis kim clay who does the minutes who is in new jersey and got two friends to participate in shape up team. thank you kim clay. lastly you can skate through the other parts of my report but i wanted to report on yesterday's retiree meeting as you know the first retiree meeting we had last month was over sold so we scheduled the second one rose mary arranged for it to be held at the coret auditorium unfortunately it was the same time as the rcc meeting the library is difficult to schedule we had had over 160 people. we lost track because everybody wanted to sit down and want sign in there were over 70 questions asked after the presentation.

they were very good questions we asked things like if you could have -- if you are a kaiser member raise your hand. if you could get your optometry through kaiser would you do that? almost all the hands -- we have never been able to gage where people are on those questions all the hands stayed up i think three people came up to me afterwards and said my optometrist lives across the street that is more convenient than driving to kaiser. i can understand. then we also asked about the item that before you today the blue shield national ppo after explaining it thoroughly and answering numerous numerous questions about it. there were again of the people in blue shield only four people who wanted to stay with the status quo.

the rest of the crowd wanted to move to a national ppo so i did not hear one negative comment about the meeting itself. lots of thank yous this is a great meeting you should do this more often. i think retirees and active members are hungry for information i will call out aon brent crane who is our accounting exec on the plans and david david rue presented on medicare 101 which he does for aon all over the country. it was substantive the majority of time was spent answering questions it was well done i wanted to thank people involved lany signed people in richard pamela -- if you haven't checked the website there are a couple

new things. there is a new eap page which is very attractive and the presentation and the questions from the may meeting are all up on the website. so that concludes my report thank you. >> i had the good fortune of attending the first meeting one of the points that came out of the meeting on the website since you mentioned it we wanted to be sure there is an e-mail address not only on the website but on the open enrollment materials that will come to the attention of this board. it's also been suggested that there be a phone number identified that would obviously ring at the secretary's desk for this board i want to put this at the tail end of your report today catherine as quickly as we

can get those two items attended to that would be helpful >> are these in the open enrollment material? >> yeah the open enrollment material on the website is what i requested. and neill our great act -- >> as a matter of record for aon hewitt as your acutary this is just for public recard when we gained the $5.4 million the actives it's all the employees benefits the employ yes and employers benefit you correctly spoke to and asked the question to me it's $5.4 million for the people who are early retirees the employer does gain money of your number it's $1.2 million in the public document. thank for