Tag Archives: Alan Desmarais

Municipal benefit trusts

Municipally-sponsored benefit trusts may become more popular as public employers look to grapple with the liability brought to light by GASB 45. Money Management Letter (subscription required) has the story:

OPEB trusts work much like pension funds and have a lower annual required contribution than a year to year “pay as you go” system. Setting assets aside and investing them can greatly reduce post-employment liabilities in the long term, according to Alan Desmarais, senior health consultant with Milliman. Some 20% of plans throughout the country have set money aside specifically for OPEB liabilities, with 40% more saying they were “likely to adopt” such a strategy, according to a report by the nonprofit watchdog the Center for State and Local Government Excellence.

The retirement board in Wethersfield in Connecticut will soon submit a draft of a trust document to the city council, said Jeff Bridges, the town manager. He added that the proposed trust will likely resemble a pension fund in terms of contributions and investments. “We are exploring various management options,” he said. “It’s more than likely that we’ll [hire investment managers]­we want

Operation of a health exchange within the PPACA

The Patient Protection and Affordable Care Act (PPACA) mandates that each state have a health exchange in place by January 1, 2014. These exchanges will be either of the state’s invention or under the aegis of the federal Department of Health and Human Services. This paper, the latest in a series of papers on exchanges, addresses the functions of an exchange and examines various operational considerations.

State exchanges are coming–what are today’s considerations?

The state healthcare exchanges that will be created as part of the Patient Protection and Affordable Care Act are intended to bring buyers and sellers together in a single marketplace for qualified health insurance. While the idea of a single marketplace is relatively straightforward, there are numerous underlying complexities, including plan cost, affordability, access, group size, participant age, marketing and education, eligibility, plan qualification, and risk adjustment. States that plan to establish exchanges should be well aware of these issues and should determine the best course of action depending on their specific circumstances. A new briefing paper examines these dynamics.

Pooling municipal health benefits

new bill before the Connecticut governor allows municipalities to pool health benefits. Alan Desmarais pens an article in the Connecticut Mirror explaining the cost control potential of such pooling. Here is an excerpt:

A new bill passed by the General Assembly and now before Gov. M. Jodi Rell for signature could offer fiscal relief as municipalities all over Connecticut stare down a current budget crisis that will become even more daunting in fiscal year 2011- 2012 and beyond. House Bill 5424 allows towns and boards of education a no-strings-attached option to pool their healthcare benefits-and thereby better control soaring benefit costs. This bill confirms that the previous legislative action, which allowed municipalities to “jointly perform any function that each municipality may perform separately,” specifically applies to the financing of employee healthcare benefits. Many towns now understand that this law opens up a necessary cost-control opportunity, and none too soon.

This is not the first time such pooling arrangements have been green-lighted in New England. The Governmental Health Group of Rhode Island was created to 2005 and now includes cities, towns and school districts that have joined together on a voluntary basis. Among the keys to the success of the Rhode Island program-which are also essential to this latest effort in Connecticut-are that member groups define the pool’s concepts, organizational structure, and financial framework.

Read the full article here.