♪ we will pause for water and reshlth and hygiene and all that i know in an hour and come back and do it again my hope by 3:30 or 4 o'clock katherine another view that might take longer well be efficient in the

presentations and the questions that will be raised we welcome public comment on any of the topics and we will precede accordingly, i made a request of our city attorney to while back over a year ago to give us guidance on one of the turns of reference that we approved as a board a little bit more than 9 months ago it was regarding our fiduciary duties around investments if you recall a representative of the treasurers did not come and explain how we're a part of the large pool of funds and forgetting but still some outstanding questions at least from a board stand point i think that and over attorney will advise us on we may need to address

in addition he wanted to you requested of the city attorney to give the board kind of and then he hope the public who are here in the audience and those who might see that as a late point about the duty of the fiduciary and the multiple of that board sincerely does indeed guide our action and decision making lots of and lots of guidance from the mayor's office from city attorney's office how to behavior and not have conflict of interest and so on and so forth annual letters around that stuff some core fiduciary requirements this board has that is unique to this board and it's role administering the trust fund for the members members of the city and county of san francisco that are part of this system with that introduction i'll ask my

worthy council eric please come forward and the secretary will read the first agenda item. >> i want to make sure that sfgovtv is recording us we cut you nine out of ten. >> eric will straighten his tie and adjust his glasses and all that stuff. >> we're okay okay. >> so item one. >> item one discussion item the fiduciaries standards and board roll in adapting the plan for sf trust fund assets and applications of pursuant person standards and the need to adopt a policy and a sf policyears. >> eric. >> okay. >> hello. >> we're here thank you eric. >> should how do we get oh,

there that is good afternoon health service board this is my first time my first time doing a presentation from this side of the podium. >> does it look any different okay (laughter). >> before i start today, i want to go through a couple of caveats to this presentation i think the legal presentation without caveats will not be much of a legal presentation at all first when we talk about the roles list in the agenda it is not meant to be an exhausted list i picked 4 basic roles to talk about the board decisions that the commissions make from fremont and also i don't mean to say you'll be engaging in one role and not more at the same time i'll briefly discuss all 4 roles today, the primary presentation it the boards roll

in investing trust fund assets second this is not intended to be a fiduciary review of the health service board investment obligation what i'm hoping today is to begin answering two basic questions first what is a fiduciary standard that applies to the health service board oversight of trust fund assets and second is it appropriate for the health service board to continue to lead the trust fund assets invested with the san francisco treasurers office and finally i'd like this presentation to be more of a general discussion we're not here today to review the specific decisions in the past more of a forward-looking discussion and, of course, hypothetical questions you want to ask that's great let's keep the questions truly hypothetical and not based on a specific decision that board made in the last couple of years.

>> so let me briefly review what i'm hoping to cover first the charter language establishing the health services as a trust fund and providing the authorization for this board to invest trust fd assets and second go over the board terms of reference specifically the investment administration policy other board adapted in april and have a brief discussion how we got here today and next go over briefly 12 fiduciary standards and then answer the question specifically with respect to the boards obligation regarding the assets that are countering have found that the san francisco treasurers office and switch gears again and go over the other roles listed in the agenda the boards roll in adapting the

plans as part of the raising benefits the boards role of setting policy and overseeing the administration and the boards roll in hearing appeals. >> okay first chart section chart section 12203 i niend the key language the charter language that established the trust fund and identifies who the fiduciaries are specifically the active and retired members they're covered dependents i think when but read this charter section in conjunction with the rest of the chariot fair to say in general the of primarily trust fund is to negotiate and approve the rates and benefits every year to make sure the

health services are based the employee employee and employer contributions the next charter system is charter section a two 49 the first sentence the board has control of the administration information xhivenlgs of the health service board board and system to invest the trust fund assets you see the priority that all the investments shall be of the legal for insurance companies in california aim in the process of following up with outside council regarding the limitations but at that point no depreciation this board contemplates making bumps up against the lirmgs this language was adopted by the voters in

1937 i think so that in the early 90s a lot of other funds moved uaw from the language all still used in other parts of country and others limitations. >> just a moment. >> sure. >> just so we're clear i'm clear it says the character legal for insurance companies does that suggest that there is a more conservative view how we should be behaving in terms of how we invest in terms of find the faster growing thing in the marketplace to do whatever it can to increase the corpus of fund in our charge. >> i don't know that this was a limitation that the voters established in 1937 my understanding in 1992 other trust funds probably adopt the

standards more likely but regardless of whether it is this standard or another standard i don't think that anything given that the health services will consider is a bump up against this standard. >> director dodd. >> i think the reason it keeps referring totions is because in 1937 person completely self-insured we paid our own claims and since city plan was born so we had to ply with any insurance standards now contract that administrative part out assume our vendors are complooilg. >> that's and helpful clarification. >> i'll follow-up to the an area i'm personally familiar with so the next - the next charter

section a 423 again, this confirms the health services boards investment authority and the administrative expenses related to the fund investments can be paid from trust funds investment. >> i know your highlighting we know you're there it is informative to look at the other aspects of this particular charter precisions it talks about a lot of the things we make decisions dissixth amendment information a wellness program, supporting the cost of our actuary all the components we find we spends months and days on here if in chamber doing again go ahead. >> that's correct so outside of paying for premiums a

question arises from time to time a certain expense out of trust fund assets and generally not until a specific allowed expectation in section a 243 is the actuary expenses and wellness programs and communication expenses. >> okay. now i'd like to briefly again switch gears slightly and talk about the health services board terms of reference that were approved on april 9th so specifically i'd like to gave us context up until a few years ago not that much money in the money in the refers i understand

they're under $20 million and that means that the money that came in pay premiums went out relatively quickly with a more robust policy combined with the city to flex the blue shield funds the reserves grew and thus, the board asked our office what the fiduciary obligations over the trust fund assets in april of third year upon the governance consultant tom do you mind a administration policy which was included 2, 3, 4 did boards terms of reference i've copied on this slide and the next slide for your reference that the boards august meeting of this year pauley marks the chief treasurer with the office made a presentation made a presentation explaining how

health services and trust fund assets are currently invested that the treasurers office so as you can see. >> - >> we didn't have an investment policy the board didn't center a policy. >> that's correct i'll get to that right now you have not formally adopted an investment policy right so this but essentially i'm refer to an investment policy if you look at the combined this - what you have newer your board terms of respect not a formal policy but the language you you've adopted duo to date so this investment ♪ administration language first as you can see the section 12203 and 09 we discussed and then it goes ton and they're taking this

requires the board to adopt a written policy statement and taking those out of order the current terms of reference require regular monitoring and ongoing review of investment performance and having qualified managers appointed to manage the health services assets but a key part of policy requires the board to adapt a written department policy statement i guess we're i know take apart words is that the policy that requires an investment policy that is what you do you mind today and the bottom 3 bullet points are depending on the investment fair to say why the board has by default adopted the treasurers policy to date the two policies we're here to discuss what the

fiduciary standard it applies to the oversight trust fund assets and should the board formally adopt the treasurers policy as the health services policy or in the alternative consider some other option. >> and while beer at this moment of pause i want to reiterate for the record this not about fingerpointing and not about what has or hadn't been done or should not by the treasurers office this is rather take into account the duties this board has regarding it's role if in area. >> how we'll decide the outcome of the next steward step it a matter for another day. >> okay. thank you. >> so, now again, this is switching gears slightly we want to briefly go over the various

sfefl fiduciary the california constitutional standard for pension system not a pension system this standard doesn't legally apply to us i wanted to read it so you can get a sense of the standards look like requires that the board of a pension system shall discharge their the united states with respect to the system with the care and skill and prudence under the circumstances that a pursuant person familiar with those matters will use in the concoct of duties this incorporates this constitutional fiduciary standard for the retirement system again, we're not a pension system it doesn't apply to us when we look at the other trust in the city are there the recommend system we're talking about the hfrs system a

standard that applies to the health care system and a state standard which is the uniform pursuant investor or the upi a a standard in probate or the fiduciary obligations for terrorist fee managing a state that standard requires that the fiduciary the manager trust u trusted assets as a pursuant investor by look at the requirements and other circumstances of the trust and satisfactory that standard the fiduciary shall experience reasonable care and skill and caution i think the next standard that is relevant this the arise standard it does not preto the health system but because the arise law a law that cantonese

cases related to multi employer trust from there were are a litigation or a court to review trust standards in this context it is highly likely the parts will look to arise for guidance it requires the fiduciary to act solely in the interest of the participant and benchmarks of the plan and with the care skill and prunsz and diligence under the circumstances then prevailing that a prudent man acting in a lick capacity familiar would use in the connecting conduct of a enterprise with lick character this is similar to the upi a that the california constitution. >> sure. >> the words have somewhat familiar but in a legal sense not some of the standards use the words caution, some prudence

are they enter challengeable how does we begin prudence. >> right today ointment going to specifically advise this board adapt a specific standard i think that is a discretion for a later day and so hold that question is it so r it is a legitimate question we've started to engage in a fiduciary review as part of progress i think the board will windup adopting a standard on that note i just added the next slide is the standard that the retirements health service board adopted in their terms of reference and the trust fund is the third, the lastly trust fund is designed to prefund the city's obligation to pay for

restored health care and like contributions from employees it was adopted in 2008, and requires the employees hired after january 10, 2009, to contribute 9 percent to the fund and in prop c in 2011 amended to the employees hired before january of 2009 will have to make contributions in 2016 and their matching employer contributions as well the retired health care i've pasted it right there not going to read it but prior to the standards and i would envision this process the health services duplicities a standard at this time we'll talk about the differences between the different language so the next slide is in a sense

the one i don't want to say give us legal advice the answer to the question should the board formally adopt the policy as the health services or in the alternative consider other options i think we can answer this question without having to pick a specific standard regardless of what standard this board picks i think our advise is going to be the same and so for this one i'll read this one allowed fiduciaries acting in correspondence are the upi a generally find that appropriated to remain outside expertise with the fiduciaries don't have the expertise to address the question in managing of managing the assets it is common more plan sponsors and others to remain third party consultants

or advisors to advise them on the policies recommending an investment program for on employee benefit plan this expert could advise whether it is to be rained remained are ray retained in longer investment strategy. >> to put a pin in this to be be clear our council on this topic regarding the roll that we have as investors under our investment terms. >> right we can advise to the legal standard is we're not here to provide specific investment advise the idea that consistent with the fiduciaries obligations it make sense to consultant. >> if we determine because we were too busy in other matters wiener we don't want to address

this gay would we be acting as good fiduciaries as we'll save that to the ends hopefully, we'll see what happens i mean, hopefully you'll follow the advice. >> okay. >> we'll not there it have to answer that question. >> now switching gears we'll discuss the board role as oversight role for managing health services and assets and investing overseeing assets i want to talk about so the other 3 i think major roles this commissioners play on a yearly basis the central with an in adapting the rates and benefits every year set forth in charter second second a the board shall have the power and the majority

vote of the heart and soul to adopt the plans or plan for rendering medical care to members of the system i think this arguably the role of this board the one sort of. >> i would footnote everything there are a number of people that play inside baseball for years and years a standard committee on rates and benefits would the change in our terms ever reference last year, we decided to do you away with that committee ultimately that is the responsibility of every member of this board and so rather than having a two tier kind of thing going on we we have a committee meeting and the boards meeting you're here and voting on the same thing twice under the leadership of cesarean and others in the governance area we

decided to make the board act as committee as a whole it is consistent now with the charter section. >> the only thing to add about that process and role the adoption of plans that on the - shall not be fiscal until the board of supervisors adopted by 3 quarters of its members we've had one carbon monoxide the board of supervisors did not approve a rate and benefits sent it back to the haelts so in making those rates and benefits decision obviously something the commissioners have to take into account the charters they make the benefits will be approved by the board of supervisors. >> so again the next role he wanted to discuss is in a sense the role of the commissioners on

this board policy as a policymaker and making higher level decisions verse providing administrative oversight to the health services the health services board makes the decision for the day to day operations are left to the vice president head for example, the board votes on expending the wellness a contract for data collection and approve the budget every year but when it comes to administering the contract or promoting the wellness plan that is an administrative function of the department charter section 4 point one 02 lists the schaerpt section the last forgave so i didn't include it in the that time but the powers are evaluate and approving the goals and objectives and plans and

programs and setting the policies consisted with the overhead city objectives with that said, the distinction between a administrative decision is not clear regardless of how we characters the decision charter section 4.102 go through the department head with administrative matters in the department works with the vendor to implement the contract and if it comes to light the board has concerned how the contract is implemented the process to contact the vice president head and try to work out in the past and this is happened the commission gets the binder with the agenda and flip that open with a budget you can call

the cfo with a question i'm sure and that's okay orange county communications to date that takes place between commissioners and health services and staff it is fair to say those conjectures are done within the explicit or candidate content of the director if you look at the bottom of the slide there is this while you have to each commission has to relatedly being fair to the department shall deal what the administrative matters of through the department head nothing should restrict the boards or commission hearing an inquiry as provided in the charter the point those powers are formally powers of inquiry i just not going to spend any time gopher this slide just to point out a whole charter section that outlines the former powers this

power of inquiry is not cart blank for a commissioner to call up a staff member with a question he or she has b a decision to engage in some sort of investigation or have a hearing he was really to trying to think of a holy know that member services a great member services team for some reason complaint about the member serves to contact the director i assume they'll be able to work it out, however, for some reason noable the board felt the director was not resolving the concerns then you could invoke this power of inquiry and engage in a more thorough fact finding investigation. >> can i. >> oh, sure. >> related to that i'm new to

the board it was a little bit of a surprise i got e-mails from enreels exclaiming about the errors and their medications were not available and sent to hawaii it is something related to those kinds of complaints how they get farltd in terms of coming to all of us and get forwarded automatically we don't need to respond individuals would it be useful to have a statement guarantee i'm not the right person by charter or whatever about once a week or every other week. >> that's a great question part of the reason we're having this discussion here today i don't get those e-mails so listening to you is tells you two different categories of

e-mails either way both of the categories should be forwarded to the health services system generally, if their e-mails related to administrative matters not related to an individual health services member you know claims process or medical issue again, this should be forwarded directly to the director and let the director handsome that the director is a could respond, however, but you i think this would be the better way to handle it with respect to members proven commissioners regarding their own claims experience let's get to that the next slide that's this late board member role if you go through it and you have questions we'll talk about and finally the commissioners play a unique roll in member system

appeal in this case, the commissioners are acting as pifks method of operation forgive judges you're putting on a hat like a court of law one of the principals of the court of what are you be fr to both parties both the health services system and the health services member so health services member role you has the member appeals and grievances is on the health services website requires a member to go to the health services system before filing on appeal with the board therefore by the time the board members file is an appeal it is obviously if they go to the health services it will get accounted and realistically in a member files an appeal by definition the health service board has 250b on the opposite

side when a claim is filed with the board the boards needs to insure the get is revolved after a levels the playing field and it is critical no x parliaments or party communications before the staff or health services board commissioners and the health services member about this specific members colleague by exasperate a existence with one party the other party is not privy too for the levels the playing field for the member i as general council for the system can't represent both the system and the board at the same time with respect to the member appeal that is in the fair i'm advising the health services system on appeal and then the member comes out with an point out and turns to me for advice this would be a conflict and be

more than just unfair it would be illegal and a problem for the city for them to have a legitimate hearing on the issue therefore the city attorney's office set a think ethical screen and if the health services board needs advice the attorney from the city attorney's office that will representing the health services interests the team with work with the dpw they have extensive expertise in to the area of raw and the office made and policy call that make sense to represent the board in those appeals i think that is just easily logicly the health services didn't need a legal advice to resolve those if i was he representing the health services we need another taxi driver attorney now we've tried this that make sense for me to continue to represent the boards

for health services appeals i could see a situation as long as we're having this discussion for some reason, i provide advise for a member appeal so from the health services system i'll switch for that one case and the office ranges for another attorney to represent the board that has not happened yet and hopefully won't with respect to all health services communications had be other health services secretary and effects the clerk under those set of circumstances so when i guess ford respect to a communication send auto a out a communication it goes to the member and the board their copied on all communications to answer over question if a conversions is contacted by claims i think that is okay to

provide the member general information whether to the website look at the member guide, take into account the you know member rules regarding appeals but direction them to member services the southern if a commission interacts with the health member with their claims or issue and it didn't get resolved the person is fooel on appeal depending on the fact it is conceivable you'll have to recuse yourselves with a 7 member board and now recuse a 6 member board and a 33 split i don't know it is con sebl we'll say the health services decision is uphold because not enough to

turn offer the boards decision is it so ironic if the member went and the board member not able to vote for the member it would be just a lot easy if a you are contacted regarding a specific member colleague or medical issue you just you know refer it to a member services i think you're fine to refer it to the head of member services or the decoration to handle that appropriately that has happened consistently in the past. >> i have a question. >> okay. >> we have now on e-mail directly to the board so in some situations the people that are writing in complaining about the director are we supposed to ignore that we canned put a box

around the board with no contact with the members it sounds like so information from the board so we should have some kind of a policy would say going to respond to the e-mails at our directly to the board would probably be the president of the board and it is to the board and i don't think it is proper to say ignore them all especially, if they're complaining about the person our ref them back to we have to get that about some of the direct e-mails. >> these are benchmarks and working solely for their benefit; right? and that's - >> over and over again, it says it to ignore those e-mails and say someone else will take care of that i agree an appeal

in the nature, of course, but rounded things someone is complaining about somebody does something and send it back to that person i don't think that is right of. >> well, i think again let's keep this conversation at a higher level without specifics i think there is going to be i guess i don't receives e-mails who general complaints about health services from the administration and then specific claims about member claims again, if it didn't get resolved the member can file an appeal and the member has the right to have a hearing on the merit i understand that every member probably a first amendment right to approach the board on what we have topic by maybe we can do

going forward in the next couple of e-mails get forwarded to me and workout some kind of appropriate way for the board and the health services system to respond to these e-mails to balance all interests insure the members right to appeal is not jeopardize by communications between the commissioners and the health services. >> those were not necessarily appeal issues. >> right it is not an appeal issue we'll look at it and figure out what we're going to do about that but again to the extent this board has issues about the administration of the health services from those issues these ordinances have to get worked out with the director that charter section 4 if the 102 no way around it if a member is unhappy with senior staff or

the director it is going to have to get worked out the only way to communicate the way to do that is get the board to the director to resolve those ordinances. >> the communication could be the power of inquiry process we referred to earlier. >> correct if i have a series of complaint not able to account with the director i'll point out every issue has been worked out not aware of a single issue or with bart ever came up that the director and the board were not able to workout but for some reaps a assessors of complaints and a systematic problem the board can have a hearing and testify and answer our questions. >> i think the work premises

on this particular point we have created on a e-mail addresses okay. we have a phone number attached and so we've invited people to share with us their concerns but we hadn't been as- to process those things once we get them that's the point that karen is making we need to give thought to it the ones i've seen commissioner breslin i know i couldn't respond to someone's open enrollment issue i've had to rely upon someone sending that to the person that knows something about open enrollment i wanted ♪ exchange the assurance that that is attend to by that member of the department i assume it was

attended to primarily or the person would have sent another e-mail no. you didn't do it right of we have to exercise a little bit of judgment not only because the charter tells us to but it makes sense the person is writing trying to get a response or clarification or whatever i may not be in the position to do that or may not have the clear information we have to rely on the director and their team to do that but again, if we think something is reoccurring or pattern starting to develop or what have you, we have again, the authority to make the kind of inquires from the director not satisfaction and take a more formal direction it is a matter of coming up with the process understanding about how we're going to respond to this channel

of communication i think rightfully have created >> i'll talk about it i see a situation 80 percent of the in-laws or a specific member claims issues we could come up with a formal response i'll send out to the extent not failing into a category of non-complaints or an el serve member we have a brown act not having everybody for e-mails we have a meeting a non-noticed meeting. >> so one person. >> what what. >> i'm assuming. >> yeah. we'll talk about that and think about it and come up with a way for hotchkins e-mails we'll put our heads together to come up with a way it works. >> we'll expect our that guidance and council to assist us i think there is another yes

another question. >> fiduciaries who is the fiduciary i've had a lot of material on this and has there been any supreme court decisions that refine fiduciary not just us but the director or anyone that is investing and the staff to some degree. >> right those are all good questions at the beginning of this presentation that was my second caveat not a secondary caveat review the commissioners are fiduciaries i understand the someone at the treasurers office acting in a fiduciary with respect to the assets what what we haven't talked about the con turns of that relationship with respect to decisions other than the disbursement of trust fund assets the international employee

benefits affirmation along with my having attend their meeting in june sent me an article called the trustees handbook that thick too inches worth of stuff the first 90 pages is about the role of a fiduciary the fiduciary relationship and talked about the pensions and multi employer health benefits as well i don't think that is one theme that come out of it, yes we as fiduciaries in this plan can peck others to do thing on our on behalf audit and investment all kinds of stuff doesn't relieve united states i us of the primary accountability of experiencing judgment and prurnls and reasonable are person standard that person is

doing it and let it alone we still remain some of the accountability in our role and a as fiduciary i recognize not a clean depiction for the health services you but that types of itself 2, 3, 4 the fiduciary role. >> i don't want to put the cart before the horse one of the reasons we're having this decision is a question of you know is that appropriate to leave the assets with the treasurers if you windup taking our advice get an expert and it is appropriate that is a different world than if you tried to choose some other option so when you read that to treefts law or kwhaefr the supreme court cases are it is much more complex set of decisions the retirement system faces or the health services

system is taking their sole purpose to invest the trust funds assets over a 40 year horizon what i think this board needs to do build a sensible fiduciary policy around after hearing advice from you know an expert explaining what we you know and after this board sort of adapts what is appropriate use of trust fund assets again, after consulting with the experts the boards decided to stick with the treasurers office and adopt the treasurers policy as the boards policy that is one depreciation and we can continue a fiduciary review bans that depreciation if for some reason the board goes in another direction there will be issues that arises from that decision.

>> our containments to the governance policy is saying you should have a policy not change what you're doing but a policy that says what you're doing we say don't have anything in writing egging writing i don't think anybody wanted to get involved. >> in a sense you have a policy by default you're investing your money with the treasurers office they have a policy you heard in august pauline came up with a detailed policy how the trust funds is being invests you raise the issue are a fiduciary standard that approaches any of the fiduciary standards we've talked about is that a pursuant way to invest the trust fund seats assets that's the question i'm not an investment expert i wish i was this board has the opportunity to answer that

question if in due season. >> any other questions. >> yeah. you answered the question about other trusts within the city system. >> yeah. >> is there overlap between the retiree care so they are a different fiduciary board and so there's no over laptopo so those funds for retiree health care. >> yeah. >> their two different trusts this trust gets money in every year and used to negotiate the rates and benefits assume your 99 percent of the money a large percent of the money gets spend o spent on member premiums every year the city in 2008, through prop b because the city a had been going as a pay as you go and over the next couple of years

you know the retiree health care costs are close to 6 percent of payroll probably to 10 percent over the next several years they've decided they negotiated with labor. >> way to prefund the city's obligations to pay for retiree health care so they created the hocking trust fund and have a mandatory member contributions and recently they adapted the last charter amendment with some exception any expenditures is not projected to be fully fund until 2044 we have time and there are no - again get back to the policy you know obviously you know it has to - what is persistent has to take into account the obligates that's why i was confused no expenditures

until 2044 presumably. >> what they start. >> not impact the decisions you, you make you get the money from the employee and employer i'm not saying you don't care but the money is regarded in the collective bargaining and the county and through the charter with the health care trust fund formula you hiring the retiree trust fund height they get the money and invest it at some point through the controller's office write a check or wire transfer to this fund. >> that's the question. >> at this point in 20044 when the money keeps from the health care trust fund. >> we look at the rates we look at retiree rates on medicare not on medicare 34ek we look at this come out of funds that are paid or is he exclude

the other funds. >> commission. >> by default we use this as a a result for the fiduciary investment thirds party to invest the funds there's a defensive between the retirement and the health care board and ours ours is outside of the reserve pretty much what we receive is what we pay to the provider so it is mostly in and out i like what the retirement does it maximize any fortunately for any proofts there is a later on as far as investment i think except for thirty years but a big difference but going back to the recommendations by the governs committee what no other

be to likely one forgave we're we use the office as our fiduciary third party to make the investment autopsy on that point. >> what the governance committee is lacking for just photograph we use this as our third party investment that's the investment for us. >> as a one commissioner reserve any right to make that depreciation at a later time i'm not prime the outcome today to what we will finally do as at board maybe the intent of the governance committee that maybe what whether happen and ultimately but not done the due diligence to reach that depreciation that's where we are

and we'll take that particular point up at a later meeting any other general questions about the fiduciary role? >> okay. >> my council i thank you for ceasing us with another question and opportunity. >> thank you very much. >> thank you hearing very much i'll request we take a 5 minute pause. >> now that cigarette of our agenda was in parenthesis was populated to be 20 minutes long it's absolutely the reason we're here and not pacific because of presumed timeline there is some of the topics we want to cover and in indeed we don't get them

all covered they'll be carved offer for other moments on the future agenda the point a range of topics and issues some near term and some fallout out to make adjustment we'll do that but at the end of the day this was supposed to be an education session for the board and public we'll be diligent about this and okay. so now we'll move to item number 2 item 2 discussion item internal investment near term 12 months and longer-term 24 months and public and private segments nationally california and the back and forth issue h s f state taxed and transparency bay area

9 county analysis transparency abc president scott. >> ap cd. >> all claims database. >> just for the record we'll have the representatives from heating come forward to talk about trends. >> thank you if you pull our microphone it will stick in our face speak into it. >> i've been known to have a soft voice. >> speak into the microphone. >> thank you for having me. i'll try to keep it to 10 minutes. >> your name and juan anderson from heating. >> i want to start off what is happening in the micro investment. >> still can't hear. >> okay. is this better okay. great i'd like to spend a few minutes

of the michael initials and how it relatively related to benefits as the next 12 to 24 months the prospective from the public segment prospective and public prospective and where their minds they're planning for the next 12 to 24 most and focus on some of the external things in the marketplace as it relate to the carrier a competition from a aboard prospective and periodically to the bay area. >> okay. thank you. >> the clicker so many macro things 4 key things happening in the marketplace we think will have down stream prelims and everyone is talking about the tax and we'll be that but i want to make

a comment most plan passports about two-thirds have the x us tax in 2018 irrespective of public or private segment the real issue for the plan supports in general another huge area especially we feel it from the bay area around the venture capital and the health technology i think about impact not only health insurance but how the employers delivers the benefits and we as consumers use health care that is an area we can't ignore the other piece is around the changing would it be fair to say we think again 2020 we have 5 different generation in of the would it be fair to say that's across the board so the value proposition for the different generation is very