1.4% is attributable to the experience in 2017 in what was expected. we saw the health risk score scores increasing for the active and employee presentation. in the prior period to the existing data for the present period. then we relied on the blue shield inputs for how the individuals in the two plans distributed when trio was introduced. 40% migrated to trio in 2018, leaving 60% of the prior access plus population staying in access plus. they are not equal populations

from a health risk standpoint. not equal populations how they use provider in the blue shield network. blue shield provided us factors that looked at the distribution. for instance imagine the folks that migrated to trio, that was preferred provider outcome that was desired with the implementation of trio. so continuing on, page 5. there were also significantly higher large claims in the blue shield experience in 2017 relative to prior years. if you recall we discussed this in march in our review of the blue shield experience while there was serglarge claim poolings that helped to offset some of the coasts of the

individuals who exceed $1 million. the underlying experience for large claims was much more significant in 2017 relative to prior years. then the fee increases for the six costs components 2% on the administrative fees, 9.9% on the large claim pooling charge. we thank blue shield. the original increases for each of these items were higher. in partnership with blue shield they enabled decreases to the original positions to end on these rate increase positions for 2019. >> describe what is a large claim in the blue shield world. >> in the blue shield world, from a pooling standpoint, if an individual in a calendar year exceeds $1 million in medical plus pharmacy experience, then

blue shield takes the risk on the remaining claims. the first $1 million become the responsibility of sfhsf and employers. beyond $1 million is the responsibility of blue shield. >> do you recall and i recognize this is an odd question. how many of these large claims we would have had this year. i understand you say significant increase. if we had five last year, did we have 10 this year? >> i will give a specific example. in calendar year 2017, there was approximately $6 million of claim amount pooled out representing 8 individuals. the prior year there was only one individual with about $225,000 pooled out. there were some cases over $2 million. that was the nature of this

increase. >> thank you. that puts some sense of magnitude to it. thank you. >> so the third bullet we talk about how different the dependent to subscriber ratio is between the individuals who enrolled in trio in 2018 versus remained in access plus. now if you recall, certain individuals who used certain providers within the blue shield network that are aligned with the trio product, if the entire family was using those tree use providers, those individuals were defaulted into the trio plan for 2018. if they choose to enroll differently. by the nature the entire family had to use trio providers, it

would make sense a lower dependent to subscriber ratio in trio. let's say if myself and my partner were using trio providers but our son was not, we would not have been defaulted to trio. then in the rate cards, we also reflect the best doctors' fee at $1.15 per subscriber per month for 2019. >> that moves us to the reality page. >> yes, page 6. we look at the early retirees where the subsidies are determined by city charter. we look at one of the primary cost sharing subsidy sharing groupings within the active employee population, 93%

employer subsidized for bow only. 93% for employee plus one and 83% for employee plus two or more. that is 93, 93, 83. what we outlined here are the projected contributions to be paid by the member on a monthly basis. employees on the left side of the chart, early retirees, right side of the chart. impact on intercountrybution change and total rate change monthly basis 2018-2019. for access plus we talked about the 10.5% aggregate cost increase. that cascades through each of these three ways to look at cost. the employee contribution, employer contribution and the monthly total cost rate.

for early retirees, we build the formula based on the elements of the charter. the first component we looked at was approved a couple months ago is the revised 10 county. then the difference which is the difference between the employee only active rate and retiree only early retiree total rate and take half of what is left and that is the subsidy. that determines the calculation of the employer contributions we develop the total cost on the 10.5% increase. then the differential between those two numbers or the top chart, retiree contributions early retirees on the right side of the page.

>> any questions from the board? next. >> on page 7. early retiree information on page 7 is exactly the same as what we looked at on page 6. we look at for active employees the 19 196.83. the monthly total rates same between six and seven. what differs are employee only and employee plus one column for the employee contributions and employer contributions. >> questions from the board? hearing none, let's proceed. >> page 8 and page 9 illustrates rate cards for 2019.

you can see all components of the rate card buildup, medical claim cost first line. that also does include fixed costs for blue shield, administrative fee and large claim pooling fee, vision costs are not changing for 2019. that was previously approved by the health service board. $3 sustainabilities fee, expenses in the footnote in the appendix is not changing from 2018. the best doctors fee, reduction approved earlier today is built in and the claim stabbization amount. these figures represent the cascading of that $3,162,000 that i spoke of earlier for the buyup amount based on the enrollment in the various tiers for active employees and early retirees. that creates the total rates.

the 10 county amount for 2019 is $672.08 monthly. the difference again is the difference between the early retiree only rate and active employee only rate. then taking total rate minus 10 county creates a figure, take half of that to become the retire resubsidy. that is how we determine the contributions. at the bottom we compare the difference the same numbers we looked at two pages prior. >> questions from the board. >> do you have any idea for employee plus two early retiree? how many numbers in that category? >> we can research that and

bring that back. >> is getting very expensive. >> other questions? hearing none. >> page nine same with 196.83. early retirees same figures on page 8 are on page 9. that is the access plus review. now we go to the trio plan rating review. the specifics the trio. the exposure is captioned at lower level. these are flex funded programs. there is assurance element. these are insured programs. for trio blue shield accepts more financial responsibility. when claims exceed forecast

3.21%, every dollar above that becomes blue shield responsibility versus 125 for access plus. that helps provide additional risk protection for the trio program to sfhfs. not to exceed premium increase caption of 5.9% in 2019 and 8.5% for 2020. added financial protection reviewed with the health services board last year. this is with the mind that a three year time horizon was essential to review in the program, look at the changes blue shield is looking to execute for members in program delivering costs and to make adjustments for long-term sustainability of trio.

>> all right. next. with that on pages 11 and 12 we present the slides that show the comparison of rates. similar to what we looked at earlier. the moly employee and retiree an contributions at the top and we talked about 5.6% as the aggregate increase. that spreads 5.6 to 5.7 depending on the tier. an aggregate 5.6% increase plays through the active employee rates i and for early retirees we apply the city charter formula. page 11 is the 9383. page 12 is for employees. page 11 and 12 are same for

early retirees. >> what is your recommendation? >> accept 5.6% increase. looking at page 15 the rate cards presented today and increases we discussed we recommend that the health service board approve the blue shield plan renewal and 2019 rate cards presented for access plus and trio. >> thank you. are there questions by the board on the recommendations or comments? commissioner lim. >> on slide 17 on the appendix there is a increase in medical increase prescription of 18.3. what we are interested in the increase of 12.5.

that is huge increase which you haven't mentioned in your previous because 9.9 but the fees are paid to the doctors 12.5 increase. if you look at the trio, that fee is small. is that because we paid into the doctors but the doctor doesn't get the increase. i don't understand the increase. >> i will be very happy to explain. >> orient where we are in the presentation that the points the commissioner raised in the appendix on page 17 and 18. so we are clear. where it shows table one captiontation fees going up by

12.5%. then when you go to table two, trio fees change is minus .03%. the question i think that and i will share that question is why? >> i am happy to explain. these particular figures on slide 17 and 18 are on a per subscriber per month basis. so they reflect the aggregate of individuals who enroll in self only plus one and plus two or more coverage. we use these figures because ultimately the fixed free rates shared with us by blue shield are per subscriber bases. this time last year trio was still in the planning process, not yet implemented. the under writing prepared by

blue shield, there was no way to know. it was no way to know how it would play out. the 2018 column represents estimates developed by blue shield this time last year with an actuarial best estimate how that may happen. for instance access plus there was a higher dependent content in who actually enrolled in access plus than was forecast at this time last year. we know that number now because we have the 2018 enrollments. last year it was simply an estimate, best estimate. when you look at per subscriber basis because there is higher dependent content in access plus

than originally estimated, it makes the projection now that we are doing for to 2019 claims higher because there is more dependents loaded into the 2019 column than estimated in 2018. in rate making, we are looking at rates for each of those three columns, the employer retiree only, plus one, or the plus two or more. what ends up happens is that this overall 15.6% increase is indeed higher than the 10.5% aggregate increase for access plus. some of that is because there is going to be more people in the two or more tier than was originally estimatessed at this time last year for access plus. >> hasn't it been historically

true dependents are less closely in term -- costly in terms of claims? >> absolutely true. there is more of them. completely agree they are less costly than adults. relative to this time last year where estimates were made for access plus versus trio. there are more dependents. >> the class is driven by the number, not utilization? >> yes higher dependent content in the 2019 column. >> to follow up. these are mostly fixed fees paid to the doctors. that is my good example. why 12.5% increase. i could increase more on the medical prescription claims. computation fees, why is there

12.5 increase? >> again, so the 2018 caption itation feet was on the aggregates access plus population from 2017. what happened going to 2019 a higher risk individual was more likely too take access plus versus trio. you will see on the next page, page 18, blue shield did not outline a specific estimate for capitation fee in 2018. in to 19 they are able -- 2019 they are able to know what provider groups they are using and you will see the capitati. n fee in 2019 is lower for how they use providers versus access plus.

as an example if you take a weighted average based on enrollment we know now of the 413.980 page 17 and $330 on page 16 and look at it as a whole for blue shield you will see it compares relatively in line with the fee of $367.89 in 2017. that was projected for the 2018 trio. >> other questions? >> i have a question. in terms of we know that a lot of the rise in healthcare costs are pharmacy related. does both access and trio use the same pharmacy benefit program or how do they manage pharmacy costs? is there a difference in the two plans? >> benefits are the same.

>> thank you for coming. >> thank you for having me. i am with blue shield of california. yes, the plan design is identical for both the access plus as well as trio plan. there are differences in the aco partners who are part of the trio product, they do more aggressively collaborate with blue shield to manage the cost of prescriptions, settings in which they are delivered, mail order, drug, etc. >> to make sure i am clear. blue shield does not contract with a third party promising benefit program like express

scriptses or whatever? >> we use distribution channel of cbc care mark for retail and drug. we are opened pharmacy benefit manager. we manage formula and utilization and drive it with the partners. >> commissioner sass. >> i am interested in what the postmortem is going to be on breaking trio from blue shield here. what i believed would happen a year ago when this was suggested. i thought it would be similar to what happened as kaiser grew and blue shield shrank. now this isolates the cpmc patients from other patients. what you are saying is people moving to trio are in better

health, fewer dependents, lower coasts on a number of scales. the people that remain in access costs see it driven up. it is adverse selection. when you put the two together and you average it all out, what is the rate of increase in our health costs from last year to this year as consequence of making this change? what might it have been if we hadn't done this in the first place? would we be better off overall or are a few people benefiting? it is less than 50% benefiting, 80% that remains are kind of being penalized as a consequence. it is important to understand what the economics of this actually look like as opposed to the alternative had we not done this. one theory was that perhaps c

pmc would see they needed to be more competitive and proactive in managing people more efficiently to stay competitive. if your population is sicker and includes more dependents and people stay in access plus because they have health needs and specialists are involved with their care they need to stay with. it seems like a situation where blue shield is extremely expensive at the expense of around on some level, and i look at this trio as shadow priced a few percentage points behindna terms of rate increase. >> i will speak. 8.8% is the aggregate rate increase across both plans. that increase would have been 8.8% or similarly from 2018 to

2019 had access plus been the continued only blue shield plan. the benefit of the rating for trio occur understand the 2018 rating where in absence of trio, the access plus increase would have been 5%, and it was. the rate increase for 2017-2018 access plus was 5%. trio the rate decreased 5.9% when you compare the 2017 access plus rate to the 2018 trio rate. the members who migrated to trio saw the immediate benefit in their rates from the projected reduction in costs that trio would deliver as part of the aco partnerships, rate increase captions i talked about earlier and so forth. that played in the 2018 rates. we it is here today only having very limited early information

on trio claims, not enough to build into the underwriting forecast for 2019. we have had the opportunity to sit with the blue shield team to review some early data. again, what we have access to now that we didn't have then are risk scores of populations. one plan versus the other. dependent information and so forth. to me, yes, based on that information we have differential increases between trio and access plus we recommend for 2018 to 2019. clearly, we need to keep an eye towards how each of those populations develops and the claim experience. i would say that you saw about a 4% reduced aggregate blue shield rate for 2018 because of the trio implementation.

40% took tree use, 10% times that is 4%. that is how i get the number. for 2019 the aggregate plays out. you have a rate stabilization deficit you hope to draw to zero. we know the claim experience for 2017 ran higher than was projected in the 2017 rate. that plays into why 8.8% on the aggregate. you raise excellent points we need to monitor. >> thank you. other comments or questions from the board? any public comment on this presentation? all right. what is your pleasure? the recommendation is found on page 15 of the presentation.

we recommend the health service board approve the proposal and rate cards for access plus and trio. >> do i hear a motion to that effect? >> i would move we approve the proposal and the 2019 monthly rate cards as presented in this material. >> is there a second? >> second. it is moved and seconded we approve the rate cards as presented in the material and previously described to us. is there any further questions from members of the board? any public comment? hearing and seeing no public comment we are ready to vote. signify by a ye. those opposed.

the motion is carried unanimously. all right. we are now ready to move to action item 8. >> approve kaiser permanente rates for to 2019 plan year. >> mike clark. we present the recommendation for 2019 renewals for kaiser california enrollees. active employees and early retirees. >> i notice you specify for kaiser california. when will be anticipate seeing the multi regional rates? >> we will present that in june. >> i want to be sure no one would be left out. thank you. >> indeed. page 2 we recommend that the health service board approve .3% premium decrease from 2018 to

2019 for active employees and early retirees in california. the active rate cards like we did with the blue shield. the 19683 contribution strategies page 3. >> i am ready to entertain a motion. >> i move to approve the non-medicare rates for 2019 plan year. >> second. >> properly moved and seconded that we accept the recommendation of this rate decrease. is there discussion? >> nice to see good news. >> any public comment? >> we are ready to vote. signy fiby aye. the motion carries unanimously.

now knowing what is ahead of us is going to be a foot slog. we have to be out of here in one hour by 5:00. i recognize that we are still pending the trio update. i am going to ask the director if that doesn't happen today will the world fall in? >> no. >> thank you. i appreciate the patience and preparation of those who are ready to make that update. we will try to entertain it in june. i would like to move forward to item nine. >> discussion and possible action of the city plan, suspension of rate stabilization, city plan design changes, changes in tier ratios and non-medicare and premium contributions for to 2019 plan

year. >> mike clark. you will see on page one the contents for today. there was a separate two page handout that was prepared for the commissioners of the board and available to the public on the table. >> . >> there is a lot of stuff. we are going through it. >> i will refer to that. these are highlights from our february presentation on the reserve approval for the city plan. >> last month i stood before you to discuss sustainability actions on the uhc city plans

specific to early retirees. today we are going to talk about the entire population early retirees as well as active employees. that will lead to recommendations that we have suggested to the board for plan design changes, network changes, subsidy adjustment changes that will then lead into discussion on the both the status quo renewal summary for city plan. seeing the rate cards and impact of 2018-2019 projected rate change if you took no action and several scenarios for your consideration today. >> on page 3. we remind everybody of statements we made last night. of the city plan for active

employee and early retirees populations with the city charter. this is a important plan for sfhsf that is our goal. our call to action knowing that there are complex issues we will discuss today the plan will continue to experience erosion in the claim experience and acseller rate to a death pieral which occurs when costs increase which then causes lower risk populations to leave the plan, leaving higher risks in the plan, adverse selection. page for a multiyear plan is necessary to positively impact viability. we are asking to discuss recommendations for 2019. there will be continued dialogue

to 2020 and beyond on evaluation of ideas. this will be part of the strategic planning discussion in coming months. >> coming months. this will begin on june 22nd and the planning meeting this board will conduct. it is not like this is going to drift into the future. we mean that we are going to be talking about trying to begin this process. please proceed. >> thank you. we address these three reasons last month to re-address the rate stabilization. reserves are depleted from the high of $26 million in 2014. this was where i referenced the two page handout distributed $1,061,000 left at the end of

2017. this two page handout is from the february hsp presentation on the derivation of the $1,661,000. we know there are escalating costs for prescription drugs and the city could payments are less than for foss access plus and trio. prescription cost are the highest inflating costs of healthcare cost also. we want to maintain afford ability for members. we have members with limited plan choice. they do not have all maps availability based on geography, active employees and early retirees. diving into that on the next two pages. for the active employee population there are 73 active employees to the most recent review who live in the zip code

with limited plan choice. when we refer to limited plan choice kaiser and blue shield plans were not available, at least one kaiser plan or at least one blue shield plan. majority live in the geographies -- agree graffitis referenced today. that is 73 out of a total active employee population of 1,049 employees. page 7 is 436 early retirees in the zip code with a limbed plan. you can see the top three rows at the table. they are 68 in california. at least one plan is not available. 321 live outside of california

but in the u.s. 47 live outside the u.s. it is 436 total out of 780 with limited plan choice geographically. we are going to present four recommendations for all populations. these should look familiar. we discussed these in the april health services board meeting. they apply to both active employees and early retirees. recommendation a a separate plan for those individuals that we just discussed. the 73 active employees, 436 early retirees who have limited plan choice due to geography. again, no one has come up with a betternam than city plan choice not availability. i welcome creative thought.

>> we will engage in creative thought. >> city plan choice not available in this presentation. item b is a win for all. lower overall plan cost. the united healthcare contracting strategy with providers and ppo network with no adverse impact whatsoever. slightly lower rates paid for services to the same providers. items c and d are plan design related. changing the prescription drug co-payments to match those in access and trio plans. increase the deductibles in the city plan. they are currently the same. i am following the pages that talk details. so from line 12 is a single page

addressing each of the four recommendations. on page nine the additional cost we have captured in the right hand column. we project an additional cost to the employers of $270,000 for the active employees and $620,000 for early retirees. we updated from the april presentation now that we have created the rate cards and done the actual calculations. the idea is lower contributions for many of the active employees recognizing that some already do have special subsidy agreements, but for all active employees create consistency and lower contributions. for all retirees in those geographies with no full plan choice. >> all right. page 10. >> page 10 is the migration to

the selling elect plus network or what you need healthcare calls select plus network. no disruption to members. some communication needed. overall savings $485,000 for active, $200,000 for early retirees. it is higher for active employees this is a california ppo network change. >> page 11. >> increasing pharmacy so-payments. it was asked to be clarified at the last meeting we would not be changing the current specially drug cost changes in united healthcare. i captured that under member impact. projected savings $150,000 for active, 140,000 for early retirees. the table below shows the current co-payments for retail

and mail order prescription drugs in the city plan and what we proposed in 2019. those are the co-payments in the proposed columns for the blue shield plans today. >> all right. >> the out of network deductsibles we added information since the last meeting. 5 percent of present dollar in the uhc city plan going out of network. now there are 1127 unique members, many of these are individuals who may only have one service or laboratory service associated with the visit to the in network physician. overall the cost impact, savings less than you saw with the other recommendations 17,000 fo for active, $16,000 for early retiree. that would take the out of

network deductible to twice in network same as we presented in february. it promotes use of in network provider in the city plan. >> yes? >> how many people are out of network? >> there were a total based on united healthcare of 2017, 1127 unique people used at least one provider that was out of network. >> that is a lot of people out of network. this is going to affect a lot of people, right? >> it has potential to impact in 2017 it would have impacted. keep in mind if it is a $20 service and someone was already within the out of network deductible, this is the -- doesn't mean they are paying more if they never go got got t0

our 5000 or 750 out of network. they would have to incur at least $250 as single enrollee of expense out of network for this to have impact on their cost sharing >> the 1100 people are early retirees or active? >> a blend of both. i don't have the numbers split between the two populations. >> are there questions on this recommendation? hearing none, let's proceed. >> we have a premon pages 13 and 14 for early retirees only. presented at the last discussion, that is to change the rate tier ratios in the city plan over a three year period to migrate them to become consistent with the distribution of the rates and how they distribute by tier to blue

shield. this would benefit early retiree families in the city plan. no change to how we approach rating for the single retirees in city plan or in kaiser or blue shield. this is only a benefit to certain members. that is specifically early retiree families on page 14. we displayed the number of individuals based on present census in retiree plus one and retiree plus two or more tiers in the city plan under the early retiree impact column. >> if the board is looking for those numbers they are in the third column on the table. >> based on our review of the costs, $175,000 of additional costs for this first year of the three year phase-in. >> commissioner sass. >> to confirm, this doesn't change the total coast of the

plan. but it shifts more of that cost to the employer who picks up the e only as opposed to plus one and plus two. >> correct. it does increase retiree only total rate for united health care city plan. however, the difference part of the formula goes up by the exact same amount. that is why it has no impact to the retiree only in the city plan. >> other questions or comments? okay. summary of your recommendations? >> page 15 summarizes recommendations. for b, c and d, this delivers a lower claim base in our forecast for 2019. we are suggesting that be reflected so that is our second bullet. the savings from b, c, d would

reflect in the rate cards which represent approximately a 3% reduction off the total rates in our calculations that we will review in a bit. for a and e we recognize this causes additional costs to the employers. when you add those three amounts, it is $1,065,000. we refer back to the february information that we presented and specifically page 8 of that february material noted that by policy we applied $554,000 to the rates which we were going to do anyway. that was proof. there is $1,107,000 left in the carry forward balance of the rate stabilization reserve. we are recommending to use $1,065,000 of the remaining

1,107,000 that would leave a small balance in the stabilization reserve to cover the additional costs to employers of recommendation a. >> someone has asked what would happen to the 42000 remaining dollars? we could follow the example of some national activities at the national level and put it into a slush fund that the board would use to go out and do nefarious things with the permission of our council. we are not going to do that. we will figure out a way to benefit the members in this plan. don't worry about the 42,000. we will keep track of it. our c fo promised that. i know she will. we will use it for the intended purposes. >> commissioner sass. >> the reason i asked for the

2017 rereserve summary was to point out. this was december of 2017. in that year we spent $9 million more than per claims than we predicted. that is line one of the schedule. we were $9 million of actuarial losses. we wind up with $6 million net actuarial loss here which used up all of the stabilization money that exited prior to that and $139,000 of contingency money to cover 20178. the reason -- 2017. the reason we have the difference between the expected and the actual. this $1,661,000 came into

existence at the end of 2017. we are in the middle of 2018. we already know if the information in the financial report that pamela will present is accurate, we have excess claims in 2018, also. over $1 million. i would have to look an at the exact number. the probably is the $1.6 million that appears to be available at the beginning of 2018 is likely to be gone by the end of 2018 as a result of the losses for this year. if we make a commitment to use the money for 2019 that all of the losses that we experience for 2018 with the exception of 41,000 will come out of the contingency fund. then for 2020, we will be adding premiums to the city plan to

start recouping the stabilization reserve like we are doing this year with blue shield. i don't see the logic in spending money that existed in january of 2018 for something we are going to do in 2019. you have taken 30% of it if that is the policy. anything more than that seems extremely short cited where we are year-to-date with the city plan this year. it doesn't seem like it is in anyone's interest to draw down the contingency funds. we started indiana 2017 by millions and recoup in 2020 with the next round of planning. unless there is a very clear plan for 2020 that addresses those kinds of problems, i have a difficult time taking the

42,000 of the stabilization reserves. i thought it was $41,000. >> it says $42,000. do you have a response? >> fantastic comments and observes. i agree about looking at 2020 and beyond, which ties back to president scott's comment about the strategic planning process and actions are clearly needed on this plan to keep it sustainable and viable for 2020 and beyond. there is full recognition that needs to occur. i know that will guide the process because that ask in clear need. with this presentation we are trying to address ideas to help elements of sustainabilities for the city plan into the 2019 as a first step. i will say this in terms of looking at the population

between 2017 and 2018, this $1,661,000 i discuss in a couple slides was created by an infusion of 200 active employees in 2017 into the city plan that were not there in 2016. the use of stabilization reserve money is a 2017 rating. we did include that history in the appendix on the very last pagena close to $7.6 million was used for the active employees. early retirees received the downstream impact because of the actual difference. that helped to generate a modest increase in absence of any rate stabilization consideration now that we calculate rate

differentials between 2018 and 2019. we know from the work that we saw an improved overall risk score in the city plan and most current period versus prior period. we are also trying to come up with a couple ideas that help number one the individuals who have no choice. they are in traffic areas where they don't have kaiser available or don't have blue shield available or both. we are also trying to recognize that there are rate tiering methods that play very different for early tire refamilies between the city plan and other available plans that we are trying to help bring in balance to support early retiree

families. approximately 191 individuals to perhaps try to improve the risk pool of early retiree families in the city plan relative to where it is today because of how it impacts the retire replus one or plus two or more individuals in city plan versus other plans. i say that the basis of the recommendations but i fully acknowledge and agree with your concerns going into 2020 and beyond. >> thank you. commissioner lim. >> slide 15. i fully support your recommendations except $1,065,000. understanding on the third bullet point, it is mostly benefit $1,065,000 for the

benefit of the employer. >> actually it is a way to pay for contribution reductions that occur through these two initiatives. we are basically proposed through a and e that members pay 1 million and $65,000 less in 2019 than they otherwise would have paid without these recommendations. now what does that mean? total cost has not changed. we are changing balance between retiree and employee and employers. we are just this is a way to help fund the reduction in corn tributions that needs to generate for these members versus what they would pay in 2019 without he's actions. >> it is not going to the employer, it is going to the member?

>> the employer woulthe be coven the stabilization reserve. >> net zero cost impact overall, we are moving. this is the mechanism by which to fund the additional $1,065,000 incurred by the employers with a direct corresponding reduction in contributions versenos action for those applicable employees and early retirees. >> questions? >> i have concern about the 100 out of -- 1100 using out of network providers. they probably have serious reasons for doing it, i would guess. >> i would state there is a valuable benefit out of network benefit available. we have simply saying that we

feel the deductible should increase to reflect services are more expensive out of network we are talking about overall $500 deductible for a single up to family then co-insurance kicks in. >> still only paying 50% out of network. >> they are only going to pay 50% put increase. double it. i mean that is unaffordable for a lot of people. >> other questions, comments? >> we list the recommendations on 16 and 17. today we have the health service board to consider the possible actions to approve the five recommendations i have discussed.

creating a separate plan for the city plan enrollees with limited plan choice due to geography. i illustrate the rating impact for those individuals later in this presentation. the lower overall plan cost uhc provider with no adverse impact on members, change for prescription drugs to match blue shield, increase out of network deductibles and the rate ratios for the city plan early retirees. to consider a and e on page 17, it would require an action to suspend the stabilization reserve policy by health service board because we are recommending the application of $1,065,000 of that remaining $1,107,000 rate stabilization balance, it would require a one-time suspension of the self