NEW MEXICO PUBLIC SCHOOLS INSURANCE AUTHORITY Benefits Program April

COVERED EMPLOYEES 2

OVERVIEW $276 Million Expected Claims Claim reserves are fully funded Excess Cash Balance 3

BIG BID RESULTS Joint Purchasing under the Consolidated Purchasing Act NMPSIA, NMRHCA, State of New Mexico, APS Quotes for Medical, Health Management, Dental, and Vision 4

BIG BID RESULTS Collectively, nearly 200,000 members Bid Analysis by staff, procurement manager and each agency’s consultants Self-Insured administrative service Only (ASO) fees and insured quotes 5

MEDICAL Finalists: BCBS, Lovelace, Presbyterian, Cigna, United HealthCare, Award: BCBS, Presbyterian 6

DENTAL Finalists: Delta Dental NM United Concordia Award: United Concordia 7

VISION Finalists: Davis Vision, Spectera, Vision Service Plan Award: Davis Vision 8

PREMIUM INCREASES 10/08 Blue Cross Medical:+5.5% Presbyterian Medical:+9.9% UCCI Dental:+9.9% Davis Vision:No Change The Standard Life:No Change The Standard LTD: No Change 9

APPLES + ORANGES 2% of Salary is greater than 9.9% of insurance 3% of Salary is greater than 9.9% of insurance 9.9% increase on employee’s portion for single dental is $.90 per month 10

APPLES + ORANGES SALARY INCREASE INSURANCE INCREASE 3% ANNUAL INCREASE ON $13,000 = $390 2% ANNUAL INCREASE ON $42,000 = $900 INSURANCE INCREASE = $72... $281 INSURANCE INCREASE = $ $449 11

MEDICAL REVENUE VS. MEDICAL/RX CLAIMS ( in millions) 12

AVERAGE MEDICAL INCREASE 13

BENEFITS FUND BALANCE (in millions) 14

USE OF FUND BALANCE Reduced 2006 increase from 11.5% to 8.75% Postponed % from October 2007 to February 2008 Enhanced plan benefits 15

ENHANCED PLAN BENEFITS PCP Copay $15 Physical Therapy Copay $20 Orthodontia maximum to $1,500 Improved dental plan periodontal benefit $2/$5 Generic drug Copay $0 Copay for formulary diabetic supplies, insulin, and oral medications 16

BCBS HIGH OPTION MONTHLY IMPACT SingleTwo PartyFamily 02/08 Rates +7.4% $434.50$826.32$1, /08 Rates +5.5% $458.40$871.78$1, MONTHLY INCREASE $23.90$45.46$

BCBS EMPLOYEE IMPACT MONTHLY IMPACT SingleTwo PartyFamily INCREASE (EMPLOYER+ EE) $23.90$45.46$60.70 MONTHLY INCREASE IF 40% $9.56$18.18$24.28 MONTHLY INCREASE IF 25% $5.98$11.37$

PRESBYTERIAN HIGH OPTION MONTHLY IMPACT SingleTwo PartyFamily 02/08 Rates +7.4% $337.30$708.26$ /08 Rates +9.9% $370.70$778.38$1, MONTHLY INCREASE $33.40$70.12$

PRESBYTERIAN EMPLOYEE IMPACT MONTHLY IMPACT SingleTwo PartyFamily INCREASE (EMPLOYER+ EE) $33.40$70.12$93.50 MONTHLY INCREASE IF 40% $13.36$28.05$37.40 MONTHLY INCREASE IF 25% $8.35$17.53$

UNITED CONCORDIA (UCCI) DENTAL MONTHLY IMPACT SingleTwo PartyFamily 02/08 Rates 0% $22.60$43.04$ /08 Rates +9.9% $24.84$47.30$74.34 MONTHLY INCREASE $2.24$4.26$

UCCI EMPLOYEE IMPACT MONTHLY IMPACT SingleTwo PartyFamily INCREASE (EMPLOYER+ EE) $2.24$4.26$6.70 MONTHLY INCREASE IF 40% $.90$1.70$2.68 MONTHLY INCREASE IF 25% $.56$1.07$

UPDATE FROM THE STANDARD FICA, 941, and W-2 reporting done by The Standard Basic Life Accelerated Benefit can equal 100% (25% specified disease + 75% terminal illness) Survey on Section 125 and each school’s policy on when coverage terminates 23

IN CLOSING...  Thanks!  Questions?  Comments? 24