MINUTES
EMPLOYMENT BENEFITS COMMITTEE
September 17, 2009
Members Present
Darryl McCullough, Chair
Don Clothier
Debbie Copp
Joann Dean
Alisa Dougless
Brenda Freese
Chad Johnson
Betty Kupperschmidt
Sue-Anna Miller
Members Absent
Debra Bemben
Suzanne Gilmore
Don Harrison
Frank Lawler
Simone Pulat
Will Wayne
Justin Wert
Ex Officio Members
Barbara Abercrombie
Julius Hilburn
Nick Kelly
The meeting was called to order by the Chair at 1:30 pm.
I.
Officers

As required by the Bylaws of the EBC new officers were selected. Brenda Freese
will serve as the Committee Chair and Darryl McCullough will serve as ViceChair.
II. Introduction of New Members

New members Don Clothier (HSC) and Chad Johnson (Tulsa) were introduced to
the committee.
III. Approval of Minutes

The August 2009 minutes were approved with the following minor changes:
 On page 3 under Health Insurance Highlights, 2nd bullet was revised to
reflect a 10% cap on the PPO and a 12% cap on the HMO, rather than a
10% overall premium increase.

On page 2, item V, comment #2 by Debbie Copp was corrected to read:
“Debbie Copp stated she does not think now is a good time to add an
additional fringe benefit, since OU is currently evaluating reductions in
many programs.”
IV. Renewal Presentation by Segal

Robert Grinberg and Dean Hatfield from Segal presented an analysis and
discussed each element of the Blue Cross renewal. Robert and Dean concluded
they were satisfied that the Blue Cross methodology was reasonable.
Question: Brenda asked how an influx of HMO or PPO enrollment may affect rates.
Response: Julius explained that rates are based on current enrollment, and there is no
reason to expect dramatic shifts in enrollment.
Question: Darryl McCullough asked if there were any obvious drivers of the increase.
Response: Robert Grinberg of Segal indicated that, at this time, no one factor stands out.
Comment: Julius indicated that the committee would be interested in seeing some claims
data. He said some utilization and pharmacy data shared previously was broken down to
show the committee how Aetna’s OU data differed from the Aetna book of business.
Question: Debbie asked if the renewal is based only on OU’s experience, or on the entire
book of business for BCBS.
Response: Robert Grinberg explained that the renewal is based on both. He also
explained that medical claims are 87% of the total cost. The caps that are in place are
limiting the increase in administrative fees, pooling charges, and risk margin.
Question: Debbie asked why there is a premium tax on a fully insured plan.
Response: The 2.5% premium is state mandated.
OU’s financial situation in the context of insurance renewals
V.

Julius Hilburn gave a presentation which began with an outline of the financial
challenges the University is currently facing.
 State revenues are coming in significantly below projections.
 The University may see further reductions in budgeted state
appropriations.


The total overall projection for 2010 active health insurance premium increases is
$6.5 million. Under the current contribution schedule OU would pay $5.4 million
of the increase and employees would pay $1.1 million.
Julius told the group that OU faces many challenges in planning and funding
benefits in the coming years. Because medical and retirement plans require the
most funding, it is likely adjustments will be required in those areas. He asked
EBC members for input on where they think potential benefit cost savings may be
found. Julius reminded the group that other factors such as market position,
affordability, and plan design must also be considered when evaluating how
dollars will be allocated. In addition, he told the group that while HR is obligated
to evaluate all possible cost saving options; it does not mean that all of those
options will be implemented.
Question: Don Clothier asked what the attrition rate is for the group of employees who
participate in the Defined Contribution Plan with a 15% university contribution.
Response: Nick Kelly said the 15% group will have a significant number of members for
an extended period into the future, and that most participants in that group are faculty
members.
Comment: Sue Anna Miller commented that choice is important. Reducing retirement
gives an employee choice in that they would still have the ability to participate in other
retirement plans, besides what is offered by OU. If health care goes up, there is no
choice.
Comment: Debbie Copp stated there could be positive tax benefits resulting from a
matching retirement program.
Comment: Julius wanted the EBC to see the dilemma being faced by the University. He
is interested in the thoughts of the committee.
Comment: Debbie Copp expressed concern that there is not enough time between
September and November to come up with a plan and explain the details to employees so
they can make the most educated decision possible, based on the information provided.
Response: Julius reassured the committee that details do not have to be worked out in that
timeframe. The committee just needs to decide where they think OU should try to save
benefit dollars. The University is more focused on the expected shortfall in FY 2011,
since 2010 is already underway.
Comment: Debbie stated that potential health care savings do not seem worth pursuing,
when compared to the potential savings gained from retirement plan modifications.
Question: Brenda Freese asked whether or not any decisions need to be made
immediately.
Response: Julius said no decisions are required immediately. He indicated that HR will
meet with University Administration later in the month. Next month HR will come to
EBC with rates which HR will recommend to President Boren. Julius indicated that HR
would prefer not to make a recommendation that would impact health care this year.
VI. Retirement Options Committee Report Update



Julius told the EBC that the Retirement Options Committee has reached a
consensus and will issue the report to President Boren at the end of September or
beginning of October.
The EBC and OU community will receive a copy of the final recommendations
very shortly after they are sent to the President.
There is nothing in the recommendations that would encourage anyone to leave
the University earlier than they wish in order to receive a better benefit.
Question: Debbie asked whether or not the recommendations could be implemented by
January 1, 2010.
Response: Julius indicated that some elements, such as possible deductibles or changes
to coordination of benefits, could be implemented by January 1st. However, it will be up
to President Boren to decide how and when any recommendations are to be implemented.
VII. Updates

Bicycle Benefits Legislation
 Still looking into the details of this benefit.
Comment: Debbie restated her apprehension about trying to add an additional fringe
benefit at a time when OU is evaluating reductions in health and retirement programs.
She also indicated there was some unrest in Staff Senate during the last meeting due to
the fact that some are proposing this new benefit when the University is having trouble
funding the ones we already have.
VIII. Other Business
After discussion among the group that the next regularly scheduled meeting would be
during Fall Break, it was decided that the October meeting will be moved to Thursday,
October 22nd.
There being no other business, the meeting was adjourned at 3:15 p.m.