General Information

Government Type

Independent or Quasi-Government

Entity

Utah State Retirement Office

Public Body

Utah State Retirement Board

Notice Information

Add Notice to Calendar

Notice Title

Administrative Board Meeting Minutes

Notice Tags

Retirement

Notice Type(s)

Meeting

Event Start Date & Time

September 19, 2019 01:55 PM

Event End Date & Time

September 20, 2019 12:10 PM

Description/Agenda

MINUTES OF THE Retirement Board Workshop Administrative Board Meeting September 19-20, 2019, 1:55 p.m., Stein Eriksen Lodge Present: Ms. Laura Houston, Board President Mr. Ryan Hessenthaler, Board Vice President Mr. Ed Alter, Board Member Mr. David Damschen, Board Member Mr. Roger Donohoe, Board Member Mr. Larry Evans, Board Member Mr. William Wallace, Board Member Excused: Staff: Mr. Jeff Allen, Shared Services Director Mr. Daniel Andersen, Executive Director Mr. Dave Bjarnason, Chief Compliance Officer, Investments Mr. Mark Brown, Business Operations Director, PEHP Mr. Kevin Catlett, Investment Counsel Mr. Bruce Cundick, Chief Investment Officer Mr. Rob Dolphin, Chief Financial Officer Mr. Dave Hansen, Associate General Counsel, PEHP Ms. Gail Keeler, Finance, URS Controller Mr. Dee Larsen, General Counsel Mr. Chet Loftis, PEHP Director Ms. Tiffany Lund, URS Project Management Director Ms. LuAnn Miskin, Administrative Assistant Mr. Jason Morrow, Deputy Chief Investment Officer Mr. Todd Rupp, Deputy Executive Director Mr. Travis Tolley, Clinical Management Director, PEHP Mr. Lance Toms, PEHP Program Management Sr. Manager Guests: Mr. Thomas Young, Legislative Fiscal Analyst Office September 19, 2019 Call to Order President Laura Houston called the meeting to order at 1:55 p.m. and welcomed Board members, staff, and guests. FTE Requests Mr. Todd Rupp and Mr. Jason Morrow discussed the rationale and business need for two new Retirement Planning Advisor FTEs and two new Investment Research Associate FTEs, respectively. ACTION: Mr. Ryan Hessenthaler moved, seconded by Mr. Roger Donohoe, to approve two new Retirement Planning Advisor FTE's for the Retirement Planning Department and two new Research Associate FTE's for the Investment Department and the associated budget increases. The motion passed unanimously, 7-0. AUREUS Update Ms. Tiffany Lund gave an update on the AUREUS project, including the following items: Look Back One Year Ago Laying Foundation For Success Data Conditioning/Migration AUREUS Project Overview Look Ahead One Year From Now PEHP Core System Update Mr. Lance Toms gave an update on the PEHP Core System HealthEdge project, including the following items: Procurement Implementation Team Implementation Launch Date Project Plan and Timeline Project Governance and Method Implementation Challenges PEHP Update Mr. Chet Loftis introduced the PEHP Update topics which included the following: HealthEdge Implementation HealthEdge Impact on Clinical Integration Nuts & Bolts of PBMs with Legislative Audit Pending Addition of RX to Cost Comparison Tool & Cash Back Status of Risk Sharing Arrangement with IHC Update on State Issues Update of Pools and Membership Update on PEHP Strategic Objectives January Renewals Mr. Travis Tolley presented on Clinical Integration, including the following items: Transition to post TACS world HealthEdge will create capacity Finding the most valuable tasks Using Wellness to engage members What you should know about PBM (Pharmacy Benefit Manager) Mr. Mark Brown presented on the following items: Cost Comparison Tools Update Find and Compare Costs Compare Prescription Costs Value-Based Arrangements Arrangement Objectives PEHP Gainshare Agreements Intermountain Value-Based Arrangement Mr. Chet Loftis provided an update on the following State items: Medical Dental TPA Services for Utah Department of Corrections Proposal for More Cash Conversion Met with Lt. Governor Cox Met Separately with Vertex My Takeaways Additional PEHP information included: Medical Membership as of 7/31/2019 PEHP Medical Risk Pools PEHP Dental Risk Pools Other Product Lines He also gave an update on the PEHP Division Strategic objectives. PEHP Renewals Mr. Chet Loftis explained that the final rate renewals may be different than what is presented in the meeting based on group migrations or rate adjustments during the renewal process. Mr. Loftis reviewed the LGRP January and Medicare renewals that will be effective January 1, 2020, and the Jordan School District Medical/Rx and USBA renewals that were effective September 1, 2019. ACTION: Mr. Roger Donohoe moved, seconded by Mr. Ryan Hessenthaler, to approve the following PEHP Renewals, effective January 1, 2020, with the understanding that the final aggregate rate for LGRP January may be different based on group migration or rate adjustments arising from the renewal process: LGRP January - Medical/Rx 3.9% increase LGRP January - Dental 0.0% rate hold Medicare - Supplement 4.0% increase Medicare - Part D (6.5%) decrease Medicare - Dental (1.4%) decrease The motion passed unanimously, 7-0. ACTION: Mr. Larry Evans moved, seconded by Mr. David Damschen, to ratify the following PEHP Renewals, effective September 1, 2019: Jordan School District - Medical/Rx 0.0% rate hold USBA - Medical/Rx 2.6% increase The motion passed unanimously, 7-0. Contribution Rate Management Discussion Mr. Dan Andersen led the discussion on Contribution Rate Management. He distributed portions of the URS 2019 Stress Test Analysis drafted by GRS and compared the current contribution rate methodology and the proposed contribution rate management plan. The complete Analysis was provided in the Board Workshop materials. Discussion followed. Staff will provide additional information and the Board will have further discussion in the October Administrative meeting. Mr. Bill Wallace moved, seconded by Mr. Ryan Hessenthaler, to adjourn the meeting until the morning. The motion passed unanimously, 7-0. The meeting adjourned at 4:48 p.m. and will readjourn September 20, 2019, at 8:00 a.m. September 20, 2019 Approval of Minutes ACTION: Mr. Roger Donohoe moved, seconded by Mr. Ryan Hessenthaler, to approve the minutes of the August 8, 2019, Administrative Board Meeting. The motion passed unanimously, 5-0. Mr. Ed Alter and Mr. Larry Evans were absent for this vote. ACTION: Mr. Ryan Hessenthaler moved, seconded by Mr. David Damschen, to approve the minutes of the August 13, 2019, Audit/Risk/Insurance Committee Meeting. The motion passed unanimously, 5-0. Mr. Ed Alter and Mr. Larry Evans were absent for this vote. ACTION: Mr. Bill Wallace moved, seconded by Mr. Roger Donohoe, to approve the minutes of the August 15, 2019, Investment Board Meeting. The motion passed unanimously, 5-0. Mr. Ed Alter and Mr. Larry Evans were absent for this vote. Consolidated URS/PEHP Annual Budget Report Mr. Rob Dolphin reviewed the following budget items: Overview of budget process and calendar Review of historical expenses and FTE's Proposed Board Policy Accounting treatment of software Review variances between budget and actuals for FY 2019 Review proposed FY 2020, 2021, and 2022 operating budget Review proposed FY 2020, 2021, and 2022 capital budget Review AUREUS and HealthEdge multi-year budget Board approvals of 2019 FY expenditures, FY 2020 adjusted budget, and 2021 and 2022 preliminary budget The following motions were made to approve budgets as shown on page 217 of the Board Workshop materials. ACTION: Mr. David Damschen moved, seconded by Mr. Ryan Hessenthaler, to approve the Board Policy Regarding Accounting Treatment of Software. The motion passed unanimously, 7-0. ACTION: Mr. David Damschen moved, seconded by Mr. Roger Donohoe, to approve the 2018-2019 final actual fiscal year ended expenditures as presented. The motion passed unanimously, 7-0. ACTION: Mr. Larry Evans moved, seconded by Mr. David Damschen, to approve the 2019-2020 budget as presented. The motion passed unanimously, 7-0. ACTION: Mr. Ryan Hessenthaler moved, seconded by Mr. Bill Wallace, to approve the 2020-2021 preliminary budget as presented. The motion passed unanimously, 7-0. ACTION: Mr. Roger Donohoe moved, seconded by Mr. Larry Evans, to approve the 2021-2022 preliminary budget as presented. The motion passed unanimously, 7-0. ACTION: Mr. Ryan Hessenthaler moved, seconded by Mr. Bill Wallace, to approve the 2018-2019 final actual fiscal year ended capital expenditures as presented. The motion passed unanimously, 7-0. ACTION: Mr. David Damschen moved, seconded by Mr. Roger Donohoe, to approve the 2019-2020 capital projects budget as presented. The motion passed unanimously, 7-0. ACTION: Mr. Roger Donohoe moved, seconded by Mr. Ryan Hessenthaler, to approve the preliminary 2020-2021 capital projects budget as presented. The motion passed unanimously, 7-0. ACTION: Mr. Bill Wallace moved, seconded by Mr. Ryan Hessenthaler, to approve the 2021-2022 preliminary capital projects budget as presented. The motion passed unanimously, 7-0. Annual Fiduciary and Open & Public Meetings Training Mr. Dee Larsen provided Open & Public Meetings training, Fiduciary training, and an update on Board Governance policies. The following topics were reviewed and discussed: Open & Public Meetings Training Meetings Open Meetings Closed & Emergency Meetings Fiduciary Training Fiduciary Duties Who is a Fiduciary? Fiduciary Duty of Prudence Fiduciary Duty of Loyalty Board Governance Policies Update The Board Member Annual Fiduciary Compliance Certificate was distributed to each Board Member for completion and signature. The certificates will be kept on file at the URS Retirement Office. Mr. Ryan Hessenthaler moved, seconded by Mr. Bill Wallace, to move into Closed Session to discuss confidential pending legal matters. The motion passed unanimously, 7-0. At 10:47 a.m., Mr. David Damschen moved, seconded by Mr. Larry Evans to move back into Open Session. The motion passed unanimously, 7-0. Final Motions/Other Business Order to Dismiss 19-23H ACTION: Mr. David Damschen moved, seconded by Mr. Bill Wallace, to approve the Order to Dismiss 19-23H as submitted by the adjudicative hearing officer. The motion passed unanimously, 7-0. Default Judgment on Notice of Board Action 19-21S ACTION: Mr. Ed Alter moved, seconded by Mr. Ryan Hessenthaler, to approve the Default Judgment on Notice of Board Action 19-21S as submitted by the adjudicative hearing officer. The motion passed unanimously, 7-0. At 10:48 a.m., Mr. Larry Evans moved, seconded by Mr. David Damschen, to move into Executive Session to discuss fiduciary and confidential information. The motion passed unanimously, 7-0. Executive Session The following were present: Board Members Present Mr. Dan Andersen Mr. David Damschen moved, seconded by Mr. Ed Alter, to move back into Open Session. The motion passed unanimously, 7-0. The meeting resumed at 12:08 p.m. BOARD ELECTIONS During the Executive Session, Mr. Ryan Hessenthaler was elected president and Mr. David Damschen was elected vice president and chairman of the Audit/Risk/Insurance Committee. Adjournment Mr. Roger Donohoe moved, seconded by Mr. Ryan Hessenthaler, to adjourn the meeting. The motion passed unanimously, 7-0. The meeting adjourned at 12:09 p.m. ____________________________________Laura O. Houston, Board President ____________________________________ Daniel D. Andersen, Executive Director

Notice of Special Accommodations (ADA)

In compliance with the Americans with Disabilities Act, persons needing auxiliary communicative aids and services for this meetings should call LuAnn Miskin at 801-366-7302 or use Relay Utah (toll-free in-state 7-1-1 or Spanish-language 888-346-3162), giving her at least 48 hours notice or the best notice practicable.

Notice of Electronic or Telephone Participation

NA

Meeting Information

Meeting Location

540 East 200 South
Salt Lake City, 84102
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Contact Name

Stacie Petersen

Contact Email

stacie.petersen@urs.org

Notice Posting Details

Notice Posted On

October 11, 2019 09:12 AM

Notice Last Edited On

October 11, 2019 09:12 AM

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