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Home My WebLink AboutMinutes - Health Care Benefits Trust Board - 4/14/2026MINUTES HEALTH CARE BENEFITS TRUST REGULAR SESSION April 14, 2026 KACHINA CONFERENCE ROOM 11000 N. LA CAÑADA DRIVE REGULAR SESSION AT OR AFTER 10:00 AM CALL TO ORDER The meeting was called to order at 10:02 a.m. ROLL CALL Present: Frank Trembulak, Chair Dave Gephart, Vice Chair Harry Greene, Member Mark Parston, Member Jennifer Marek, Member Staff Present: Jennifer Inboden, Board Secretary Andrew Votava, Human Resources Director Sonya Martinez, CBIZ Account Executive Eric Rustand, CBIZ Business Unit President CALL TO AUDIENCE - There were no speaker requests. REGULAR SESSION AGENDA 1.REVIEW AND APPROVAL OF THE MARCH 10, 2026 REGULAR SESSION MEETING MINUTES Motion by Member Harry Greene, seconded by Member Mark Parston to approve the March 10, 2026 regular session minutes. Vote: 5 - 0 Carried 2.PRESENTATION AND DISCUSSION OF THE MEDICAL AND PHARMACY EXPERIENCE REPORT THROUGH FEBRUARY 2026 Sonya Martinez, CBIZ Account Executive, presented the Medical and Pharmacy report through the end of February 2026. She started with the Year-over-Year Financials and pointed out to the Trustees that enrollment has remained steady at 310. Total Medical/Pharmacy Claims Paid is $2.35 million YTD. Pharmacy rebates are $140,582, up $45,000 since December. The Net Medical/Pharmacy Paid Claims are at $2.16 million compared to $1.57 million a year ago, which is a 39.2% increase, but still 3.2% below the average from the past six years. The fixed costs are unchanged compared to the end of February last year. The total plan costs are up 28.7% from last year at $2.73 million compared to $2.14 million. The funding deficit is $455,000 YTD. deficit is $455,000 YTD. Ms. Martinez continued by reviewing the paid claims and administration information through the end of the plan year for all plans combined. The average enrollment is 310. The expected claims liability, which is CBIZ' expected number and the Town's budget number, is $1.7 million. The maximum claims liability, which is the UHC contractual amount, is $2.57 million. The amount paid for medical claims through February was $1.86 million. The amount paid for Rx claims was $491,000 and there have been $140,000 in Rx rebates. The total paid claims are $2.16 million; with admin fees of $569,000 and HSA contributions of $210,000. The loss ratio for expected claims is 126.8% and 83.9% against maximum liability. The claims and admin fees per employee per month (PEPM) is $1,186 through February. The plan is running at 120% against budget. Mr. Rustand pointed out that the Plan is following a pattern that fits with the norm to exceed the expected loss ratio once every five years. Ms. Martinez continued to review the report and focused on the High Deductible Health Plan (HDHP). 65% of employees are enrolled in the HDHP. The HDHP is running at 107% of expected liability or 86% of maximum liability. The claims and admin fees PEPM is $965 through February. The PEPM a year ago was $740. For reference, the prior plan year ended at $755 PEPM. The HDHP plan is running at 102.5% against budget. The PPO plan is running at 169% of expected liability or 135% of maximum liability with claims and admin fees PEPM at $1,688 through February. For reference, the prior plan year ended at $1,411 PEPM. The membership of the PPO has been decreasing every year for the past few years and is at 107 compared to 117 a year ago. The PPO plan is running at 152.6% of budget; the prior plan year ended at 109%. Next, Ms. Martinez explained the Large Claims Report Over $50k. There are two large claimants who have exceeded $150,000 in claims. The Town will receive stop loss reimbursements for the rest of the Plan Year for these two claimants. There are five other large claimants who have not hit the $150,000 stop loss threshold yet. The Plan has paid $685,000 prior to the stop-loss adjustment of $48,680 which accounts for 29% of all claim expense. 3.PRESENTATION AND DISCUSSION OF THE FUND BALANCE REPORT THROUGH FEBRUARY 2026 Vice Chair Gephart reviewed the fund balance report through the end of February. Assets are down 12% since March 2025. The Total Cash is $3.7 million. The fund has $2.74 million in Total Revenues, which is $690,000 lower than March 2025. This is a combination of $1.92 million in employer-paid premiums, $308,000 in employee-paid premiums, $266,000 in cost allocation for the health clinic and pharmacy rebates and $101,000 in investment income. Vice Chair Gephart continued to review the income statement and reviewed expenditures. The wellness program is $35,800 and claims are $2.5 million, up 25% compared to March 2025. The total ending fund balance is still healthy, down $539,000 from the end of the prior plan year. 4.PRESENTATION AND DISCUSSION OF THE ANNUAL AUDIT Vice Chair Gephart reviewed the annual audit for the year ending June 30, 2025 that was completed in December and is required by the Arizona Revised Statutes. The self-insurance fund is included in this audit. The Town received a clean opinion. The auditors did not find anything to report on. 5.PRESENTATION, DISCUSSION AND POSSIBLE ACTION ON RESERVE CALCULATION USING RENEWAL FIGURES FOR THE 2026-2027 PLAN YEAR Mr. Votava, Human Resources Director, started by reminding the Trustees about the Reserve Requirement Policy. This policy states that the "Trustees shall determine Funding Levels and Reserve Requirements as the Trustees deem appropriate." Last year the policy was adopted to have "a Reserve Requirement between a minimum of six (6) months and a preference of nine (9) months of the Plan's forecasted annual variable costs." Mr. Votava presented the reserve calculation utilizing the renewal figures for the 2026-2027 plan year. He explained that CBIZ prepares reports with actuarial rates for four tiers of the plan. This report is where he got the $4.2 million figure for expected claims and the $5 million figure for maximum claims. Mr. Votava reviewed the other costs that are factored into the Reserve Calculation including Patient Center Outcomes Research Institute (PCORI) fees, the Employer-paid clinic, and wellness incentives. These costs result in total expenses of $4.55 million for expected claims or $5.35 million for maximum claims. Based on these projections, the fund balance should be between $2.28 million and $3.4 million. The fund currently has about nine (9) months of cash at $3.45 million. The Town successfully reduced the fund's cash balance from 12 months to 9 months over the past year. For the 2026-2027 plan year, the Town plans to fund at $3.9 million to maintain reserves within the target range of 6 to 9 months. Motion by Member Harry Greene, seconded by Member Mark Parston to approve the Plan Administrator's Reserve Calculation. Vote: 5 - 0 Carried ADJOURNMENT Motion by Chair Frank Trembulak, seconded by Member Mark Parston to adjourn the meeting at 10:36 a.m. Vote: 5 - 0 Carried I hereby certify that the foregoing minutes are a true and correct copy of the minutes of the regular session of the Town of Oro Valley Health Care Benefits Trust held on the _14th_ day of _April, 2026_. I further certify that the meeting was duly called and held and that a quorum was present. Dated this _16th__ day of __April__, 2026. ______________________________ Jen Inboden Senior Human Resources Analyst