1. Role of Montana State Fund

2. Montana State Fund is committed to the health and economic prosperity of Montana through superior service, leadership and caring individuals, working in an environment of teamwork, creativity and trust. VISION

3. Overview of Montana State Fund Role of Montana State Fund Structure of Montana State Fund –Relationship with executive and legislative branches of government Role of the Board of Directors Profile of Montana State Fund Customers

4. Montana State Fund Overall Structure Team environment focusing on service to our customers –265 FTE Market compensation Gainsharing & incentive plans

5. Montana State Fund Overall Structure

6. Montana State Fund Guiding Principles Integrity and Ethical Conduct Customer Focus Strong Financial Position Quality & Competitive Insurance Service and Products Employee Growth and Development

7. Montana State Fund Statutorily created Provides a competitive option to purchase mandatory workers’ compensation insurance Serves the public purpose of the guaranteed market

8. Board of Directors Governed by 7 member Board –Appointed by the Governor –Vested with full power, authority and jurisdiction over Montana State Fund –4 must be policyholders, 3 must be in private, for-profit businesses, and 1 may be an insurance producer

9. Board of Directors Statutory Responsibilities –Establish rates –Establish appropriate level of surplus –Declare dividends –Approve annual budget –Approve annual Strategic Business Plan –Approve annual financial report –Appointment of the Executive Director (President/CEO) –Hire independent actuary

10. Board of Directors Constitutional requirements –Open meetings –Public participation –Public documents –Protect individual rights of privacy –Board of Investments manages all Montana State Fund invested assets

11. Board of Directors Ethics –Execute statutory responsibilities –Code of Ethics –Additional guidelines/duties Duty of loyalty Duty of care Board Meeting Schedule –October 10, 2003 –December 5, 2003

12. Insurance Operations

13. Six multi-functional teams providing services to all accounts. –Each team operates independently and is responsible for targeted service goals. Team leaders direct and manage work unit –Safety management –Underwriters –Medical case examiners –Customer Service Specialists –Claim Adjusters –Administrative support

14. Insurance Operations Market Development Leaders –Agent Distribution System Underwriting Safety management Claims management Policy maintenance/Customer Service

15. Operations Support

16. Provide support for Operation teams –Ensure consistency and best practices are used in working with all our customers Policyholders Injured Employees Medical care providers –Legal Services –Fraud investigation

17. Operations Support Quality Assurance programs –Claims –Underwriting –Safety management Medical Bill data entry –216,000 bills processed in FY03 Oversee all Old Fund claims Provide internal trend and statistical analysis with comparison to industry to monitor performance

18. Corporate Support

19. Financial Services –Prepare all financial statements –Budgeting and cost control Actuarial Services –Provides all necessary support and data to keep management informed of actuarial trends, issues and their implications –Works with consulting actuary to establish adequate rates, reserves Business modeling and planning

20. Human Resources Human resource programs are developed and designed to support MSF vision. There is a direct correlation between customer satisfaction and employee satisfaction. –An organization MUST focus on their most valuable resources to be successful. Employee Satisfaction is critical to the success of MSF. –Current structure provides a customer focused team environment.

21. Human Resources Ensure that MSF is in compliance with all Federal/State regulations and policies Performance Planning and Review Process Compensation Programs –Merit program –Gainsharing/Incentive program

22. Information Technology

23. Role of Information Technology 1.Enable the business to meet its objectives 2.Provide thought leadership based on technology capabilities to resolve business problems 3.Provide information

24. Business Services Information Technology 1. Help Desk Services a. Training b. Education c. Problem Resolution d. Problem Escalation 2. Business Process Improvements a. System Requests/ Requirements b. System Documentation c. Communication d. Business Cost Justification 3. Application Software a. Maintenance b. Enhancements c. Legal/Regulatory Compliance d. Reports e. Digital Information Storage f. Batch Processing Renewals Payment Processing Customer Outputs

25. 4.Network a. Connectivity/Communications with all devices b. E-Mail and Printing c. Remote Connectivity d. Internet/Intranet 5.Hardware a. Server availability to support applications (40 servers) b. Load balancing – performance standards c. Secured, controlled computing environment Information Technology Operational Services

26. 6.Disaster Recovery a. Back-up information b. Off-site storage c. Uninterrupted power supply (UPS) d. 24/7 support and monitoring 7.Quality Process a. Methodology b. Positive and negative system testing c. Code migration to production d. Batch processing monitoring Information Technology Operational Services