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CFO reports projected trust‑fund increase, board adopts rule changes on FSAs and dual coverage
Summary
CFO Pamela Levin reported a projected $12.8 million increase in trust net assets (through May projections), KPMG audit underway, and described a General Fund contingency tied to a ballot proposition; the board adopted membership-rule updates including FSA carry-forward clarifications (max $500, min $10, one-year carry-forward) and clarified appeals for retiree health determinations.
Pamela Levin, Chief Financial Officer and Deputy Director, reviewed the Health Service System’s financial position through May 31, 2014 and presented projections through June. Levin said KPMG’s external audit had started and is expected to conclude in mid‑October. Based on activity through May, Levin projected a $12,800,000 increase in net assets of the Employee Benefit Trust Fund (noting a month-to-month variance versus prior projections). Levin also identified a projected General Fund administrative balance of $908,000 driven in part by delayed hires and a planned carry-forward request of $289,000 in nonpersonal services for contract and wellness‑center improvements.
Levin told the board she had been asked to produce contingency scenarios in case a late ballot proposition (referenced in the budget hearings) triggered a 1.5% general-fund reduction; Levin said HSS’s contingency for that scenario would be approximately $45,000 and staff is preparing options. Levin introduced David Flores as a new contracts manager and thanked staff for open-enrollment preparations.
On membership and cafeteria-plan rules, Lisa Gottpe (Chief Operating Officer) presented proposed 2015 changes: clarifying the IRS-authorized health-care FSA carry-forward (allow up to $500, institute a practical minimum carry-forward threshold, and limit the carry-forward to one plan year), clarifying dual-coverage rules for Medicare-sponsored plans (joining another Medicare-sponsored plan may result in termination of HSS benefits), adjusting timing of premium contributions to be due by the last day of the coverage period, and creating clearer appeals language for retiree benefits determinations. Commissioners asked staff to add an explicit parenthetical that balances under $10 will be forfeited; the board moved, seconded and adopted the membership rules updates and the Section 125 cafeteria-plan updates with that amendment.
