April 14, 2015
GEMC Workers’ Compensation
Trustee Meeting
Georgia Electric Membership Corporation
Workers’ Compensation Fund
Georgia EMC Workers’ Compensation
Fund Trustee Meeting Conference Call
• Randy Crenshaw
- Call Meeting to Order
• Tonya Washington
- Conference Call Reminders
- Roll Call
- Determination of Quorum
• Randy Crenshaw
- Motion on April 15, 2014 Trustee Meeting Minutes
» All in Favor
Executive Committee Report
The Executive Committee met via conference call on September 11th, October
27th and April 7th to discuss the following items
•
•
•
•
•
•
Commissioner of Insurance Compliance Audit Report
2015 Preliminary Budget
Nominating Committee
2014 Financial Audit report
2014 Actuarial Report
Financial Update
The Executive Committee gave email approval of 2014 Dividend Distribution
The Executive Committee consists of:
- Gary
Miller
- Randy Crenshaw
- Wayne Livingston
- Chip Jakins
- Tony Tucker
- Tony Watkins
State Compliance Exam Final
Opinion
Summary Findings:
1.
GEMC WCF reinsurance agreements lack automatic renewal language required by Georgia
Insurance Regulation 120-2-34-.(16)(5)(b) (Prior Exam Finding)
- Item has been addressed and should be rectified in future agreements
2.
GEMC WCF specific excess attachment point in 2007 was greater than the amount allowed by
Georgia Insurance Regulation 120-2-34-.16(4)(c), (no greater than $350,000 without prior approval
from the Commissioner 30-days prior to implementation.) (Prior Exam Finding)
- Corrected from previous audit when notified in May 2007
3.
GEMC WCF did not have in a place a conflict of interest policy requiring annual disclosure of
potential conflicts by its Board of Trustees and Officers. (Prior Exam Finding)
- In process
4.
GEMC WCF Services Agreement with GEMC has not been approved by the Department in
accordance with Georgia Insurance Regulation 120-2-34-.18. (Prior Exam Finding)
- Complete
Summary Findings Continued:
5.
Third party claims administrator (AmPro) was replaced by Georgia Administrative Services, Inc.
(GAS) in 2010. GAS had not submitted Form GSF-6 (Application to Serve as Administrator of Group
Self-Insurance Fund) in accordance with Georgia Insurance Regulation 120-2-34-.10. (Prior Exam
Finding)
- GAS has rectified
6.
GEMC WCF did not have a written agreement with its reinsurance intermediary (Affinity Service
Group, Inc.) in accordance with O.C.G.A. § 33-49-4.
- GEMC WCF and Affinity Services have an updated written agreement
Any further discussion?
- Motion to accept
- Second
- All in favor
2015 Preliminary Budget
Description
Insurance placement
Budget
2014
Projected
2015
Proposed
%
Change
1,096,524
1,115,202
1,198,850
TPA Services
141,450
138,000
141,450
-
Subsequent Injury Trust Fund
290,000
259,684
265,000
(9)%
State Board of WC
93,000
86,330
95,000
2%
Consulting Services (including
BNY Mellon fee increase)
89,000
99,500
112,050
26 %
617,246
632,490
691,065
12 %
$2,327,220
$2,331,206
$2,503,415
8%
Personnel & A&G
Totals
9%
2014 Dividends and Remaining Surplus
Year
Previous
Proposed
Total
Remaining
Dividends
Dividends
Dividends
Surplus
2014
873,049
2013
-
393,610
2012
500,000
1,204,540
1,704,540
855,306
2011
600,000
800,000
1,400,000
90,442
2010
1,150,000
200,000
1,350,000
223,633
2009
500,001
500,001
183,778
2008
1,850,005
1,850,005
2007
992,235
293,611
1,285,846
50,000
2006
1,465,186
280,000
1,745,186
57,778
2005
1,456,001
5,377
1,461,378
-
2004
1,188,401
72,652
1,261,053
82-03
26,965,506
43,820
27,009,326
101,116
36,667,335
2,900,000
39,567,335
2,698,569
Totals
(130,143)
2014 Dividends/Net Premium
Premiums
Total Dividends
Returned
6,912,322
-
6,912,322
00%
2013
7,219,468
-
7,219,468
00%
2012
7,099,315
1,704,540
5,394,775
24%
2011
6,451,109
1,400,000
5,051,109
22%
2010
6,169,447
1,350,000
4,819,447
22%
2009
6,313,430
500,001
5,813,429
8%
2008
6,370,328
1,850,005
4,520,323
29%
2007
5,647,078
1,285,846
4,361,232
23%
2006
4,965,595
1,745,186
3,220,409
35%
2005
5,158,207
1,461,378
3,696,829
28%
2004
4,887,895
1,261,053
3,626,842
26%
82-03
58,553,406
27,009,326
31,434,080
46%
125,747,600
39,567,335
86,180,265
31%
Totals
2014
Totals
•
Net Premium
Percent
Reduction
2015 Preliminary Budget and
2014 Dividend Distribution
•
Approval of the 2015 Preliminary Budget comes to
you in the form of a motion from the executive
committee
Any further discussion?
- Second to approve
- All in favor
• This return of $2,900,000 in Dividends comes in the form
of a motion from the Executive Committee
Any further discussion?
- Second to approve
- All in favor
Nominating Committee Report
• The Nominating Committee met via email to discuss the upcoming
slate of officers for the Georgia EMC Workers’ Compensation
Fund
• The Nominating Committee consists of the following members:
– Chip Jakins – Jackson EMC – Chairman
– Romeo Reyes – Satilla EMC
– Brad Thomas – Snapping Shoals EMC
Nominating Committee Report
• The Nominating Committee nominates the following trustees as
officers:
– Gary Miller - President
– Randy Crenshaw – Vice President
– Tony Tucker – Secretary/Treasurer
• These recommendations come to you in the form of a motion from
the Nominating Committee
Any further discussion?
- Second to approve
- All in favor
Investment Committee Report
• The Investment committee met via conference call on June 18, 2014, via email
in December and again by conference call March 24, 2015 to discuss the
following items
•
•
•
•
BNY Mellon fee increase
Clarify cash reserve requirement
Discuss Equity Investment Allocation
Update purchases and sales
• The Investment Committee consists of the following members:
– Matt Brinson
– Denice Swan
– Wade Hall
Investment Committee Report
Each Trustee was furnished with a copy of the purchases and sales
by BNY Mellon from the last Trustee Meeting through 12/31/2014
with the meeting notice and mail out.
Approval of the purchases and sales come to you in the form of a
motion from the Investment Committee
Any further discussion?
- Second to approve
- All in favor
Report of Independent Accountants
Board Communication
Each Trustee was furnished with a copy of the 2014 Report of the
Independent Accountants with the meeting notice and mail out
•
No new accounting policies adopted
•
No change in the application of existing policies
•
No transactions with a lack of authoritative guidance
•
All significant transactions have been recognized
•
Accounting estimates used are reasonable
•
No difficulties with management in performing and completing the audit
•
All uncorrected misstatements were immaterial both individually and in aggregate
to the
•
No disagreements with management in performing the audit
Report of Independent Accountants
Board Communication
• Internal Controls
•
The size of the Fund’s administrative staff precludes certain internal controls that
would be preferred if the organization were large enough to provide an optimum
segregation of duties
• Opinion
• Financial Statements present fairly, in all material respects, the admitted assets, the
liabilities and surplus of the Fund as of December 31, 2014 and the income and
surplus on the basis of statutory accounting as mandated by the Office of the
Commissioner of Insurance
Approval of the report of the Independent Accountants Report comes to
you in the form of a motion from the Executive Committee
Any further discussion?
- Second to approve
- All in favor
If you have any questions or comments regarding the report please contact either
Jerry Wolfe with McNair, McLemore Middlebrooks or Mary Wellman
2014 Actuarial Report
Each Trustee was furnished with a copy of the 2014 Actuarial
Report with the meeting notice and mail out.
The GEMC WCF’s Balance Sheet
• Meets the requirements of the Insurance Laws of Georgia
• Consistent with reserves computed in accordance with
Standards of Practice issued by the Actuarial Standards
Board
• Make reasonable provision for unpaid loss and loss
adjustment expense
• Make a reasonable provision for the SITF obligations of the
Fund
The major risk factor is the high specific retention relative to
surplus. The current retention of $500,000 is 19% of surplus.
2014 Actuarial Report
Approval of the 2014 Actuarial Report comes to you in
the form of a motion from the Executive Committee
Any further discussion?
- Second to accept
- All in favor
If you have any questions or comments regarding the report
please contact either Lisa Dennison with By the Numbers
Actuarial Consulting Inc. or Mary Wellman
Financial Highlights December 2014
December 31, 2014
December 31, 2013
13,199,454
12,653,907
545,547
Reserve
7,279,716
8,350,995
(1,071,279)
Liabilities
3,221,170
1,574,428
1,646,742
Surplus
2,698,569
2,728,483
(29,914)
166
155
11
Total Assets
Open Claims
Change
2014 Claims Paid Summary
Total Gross
Claims Paid
Recoveries
Net Claims Paid
2014
1,813,825
(522,314)
1,291,511
2013
4,111,335
(634,017)
3,477,318
2012
2,652,657
(479,384)
2,173,274
2011
3,438,829
(599,655)
2,839,174
2010
3,204,168
(537,483)
2,666,686
2009
5,110,110
(1,275,059)
3,835,051
2008
3,568,417
(783,573)
2,784,844
2007
3,906,832
(1,050,878)
2,855,954
2006
2,435,133
(887,723)
1,547,410
2005
3,949,768
(1,587,943)
2,361,825
2004
3,592,998
(1,200,228)
2,392,770
82-03
38,941,382
(12,885,013)
26,056,370
Total
76,725,455
(22,443,269)
54,282,186
2014 Claims Summary
Net Claims
Reserves
Paid and
Total
Open
Reserved
Claims Claims
2014
1,291,511
2,506,601
3,798,112
296
123
2013
3,477,318
1,013,696
4,491,014
336
19
2012
2,173,274
554,435
2,727,708
343
5
2011
2,839,174
214,070
3,053,245
371
1
2010
2,666,686
357,234
3,023,920
437
4
2009
3,835,051
317,168
4,152,219
512
3
2008
2,784,844
456,750
3,241,593
516
2
2007
2,855,954
63,870
2,919,824
513
1
2006
1,547,410
22,891
1,570,301
468
1
2005
2,361,825
2,361,825
493
2004
2,392,770
2,392,770
544
82-03
26,056,370
299,028
26,355,398
13,924
Total
54,282,186
5,805,742
60,087,928
18,753
7
166
Additional Items
•
•
•
•
•
•
Medical case management position
Participation in payroll audits
Experience modifier letter
Rate structure
May 17th training seminar
Potential Board Restructure
– Streamline compliance
– Improve responsiveness
– Reduce paperwork
Georgia Electric Membership Corporation
Workers’ Compensation Fund
GEMC WCF Coordinator’s Conference
Agenda
8:00 a.m. – 9:00 a.m.
Registration w/
Continental Breakfast
9:00 a.m. – 9:15 a.m.
Welcome
9:15 a.m. – 9:45 a.m.
GAS Updates and Electronic Filing
9:450 a.m. – 10:15 am
Understanding your Mod Calculation
10:15 a.m. – 10:30 a.m.
Break
10:30 a.m. – 11:15 a.m.
Is this a Workers’ Compensation Injury?
Wade McGuffey
Goodman, McGuffey, Lindsey &
Johnson
11:15 a.m. – 11:35 p.m.
The Plan: Georgia Workers’ Compensation Board – Current
Events and 2015 Legislative Update
Honorable Elizabeth Gobell
State Board of Workers’
Compensation
11:35 p.m. – 12:00 p.m.
Evaluating Your Posted Panel
Rick Thompson
Levy, Thompson, Sibley & Hand
12:00 p.m. – 1:00 p.m.
Lunch
1:00 p.m. – 2:30 p.m.
Drugs don’t work!
2:30 p.m. – 2:45 p.m.
Break
2:45 p.m. – 4:00 p.m.
Dealing with lower extremity injuries
Georgia Electric Membership Corporation
Workers’ Compensation Fund
Tony Watkins
Carla Edwards
Georgia Administrative Services
Stan Deese
Georgia Municipal Association
Jesse Hambrick
Douglas County Sherriff’s
Department
Dr. Anuj Gupta-Peachtree
Orthopaedic
Fred Hubbs-Hall, Booth, & Smith
Kevin Skedsvold-skedsvold &
white, L.L.C.
April 14, 2015
GEMC Workers’ Compensation
Trustee Meeting
Any further business to discuss?
• Motion to adjourn
• Second
• All in favor
Georgia Electric Membership Corporation
Workers’ Compensation Fund