Creating a Better, More Efficient Healthcare System for Your Members
August 4, 2010
The Problem
• San Diego Unified School District is facing unprecedented budget pressures
• Retaining talented employees with competitive salaries is becoming increasingly difficult
• Healthcare costs are continuing to rise• The existing healthcare framework has serious
limitations
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The Solution
• Create a new trust to administer the healthcare needs of your members
• Save $48 million over next five years– Apply savings to protect future wages
and benefits
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VEBA Limitations
• 50 percent of trust, 16 percent of vote
• Subsidization of other school districts
• Lack of accountability, control and flexibility
• One-size-fits-all approach
• Higher premiums
• Only district without retiree coverage
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VEBA vs. EBT
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Projected Annual Cost Savings of New Trust
• $1.3 million: Rerating of early retirees
• $1.7 million: VEBA administrative fee*
• $4.2 million: HMO co-pay modeling
• $1.3 million: Cross-border HMO
• $1.5 million: Self-funding* Based on 2007 numbers. 2009 numbers are $2.67 million
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Five-Year Cumulative Cost Savings
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VEBA Premiums vs. Administrative Fees
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Keenan Experience• 37+ years of experience• 950 California public agency clients• Privately-held, employee-owned• Largest block of public sector business with
Kaiser and Blue Cross• Commitment to product and service innovation• Leader in insurance, employee benefits and
financial solutions for California schools10
California Members CoveredVEBA vs. Keenan
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Benefits to Your Membership
• No changes to the plan
• Reduction in furloughs
• Maintain competitive pay scales
• Preserve benefits
• Maintain co-pay levels
• Keep current doctors
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Timeline/Next Steps
Week of August 2 Meet with all bargaining units
August Schedule meet and confers with SDUSD
September 13 SDUSD votes for new EBT
Jan. 2011 Members realize savings and benefits
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