HomeMy WebLinkAbout000178.tiff ffi Shirazi
Associates, Inc.
1770 25th Avenue, Suite 302 • P.O. Box 5315 • Greeley, Colorado 80631 • (970) 356-5151 • FAX (970) 356-5154
April 20, 1999
Mr. Pat Persichino
Weld County Government
915 10th Street
Greeley, CO 80631
Dear Pat:
We would like to take this opportunity to thank you for your patience regarding the settlement of
the revised rates from Blue Cross Blue Shield of Colorado.
Originally as we discussed, Blue Cross Blue Shield was considering a total refund of$210,800.
However, after numerous conversations and negotiations, we have been able to negotiate for
the total settlement of$229,943, which would be refunded to Weld County based on the
following schedule:
1) Blue Cross Blue Shield will credit Weld County's May 1999 premiums in
the amount of$115,000
2) Blue Cross Blue Shield will credit Weld County's October 1999 premium in
the amount of$114,943
Blue Cross Blue Shield has indicated that you will receive your normal billing invoice. Weld
County should deduct the appropriate credit amount from the bill and remit the net premium to
Blue Cross Blue Shield.
The following is a summary of the analysis completed by Blue Cross Blue Shield of Colorado:
1) 1999 projected claims from the original renewal dated 9/2/98 $2,319,333
2) Projected 1999 claims after benefit reductions (10.2%) 2.082.761
3) Net benefit savings due to benefit reductions $ 236,572
4) Projected 1999 premium revenue increase (4.8%) $2,326,686
5) Projected 1999 premium revenue increase using rate cap (5.1%) 2.333.315
6) Net premium revenue due at 1999 rate cap level $ (6,629)
7) Net renewal credit for January 1, 2000 $ 229,943
Financial Planner • Benefit Consultant • Insurance Broker 178
Weld County Government
Page Two
April 20, 1999
We have included an analysis of the rate renewal and 1999 actual renewal versus rate
guarantee analysis for your review.
Pat, we are very pleased that we were able to negotiate these credits with Blue Cross Blue
Shield of Colorado on your behalf, we value our relationship with Weld County and will continue
to strive to provide the type of service you expect.
Sincerely,
a Shirazi
Shirazi &Associates, Inc.
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Enclosures
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• '. RATE RENEWAL
Weld County Government GROUP# 8278
Rates Effective: January I, 1999
Annual Renewal: January I
Analysis Period: August I, 1997 to August I, 1998
Account Executive: Karen Morgan Estimated
Members
ANALYSIS PERIOD DATA Employees PMPM
I) Average Number of Subscribers 832 1410
2) Paid Claims for BC/BS subscribers $16,998 $1.00
3) Prescription Card Claims $327,034 $19.33
4) Provider Hospital P.P.O.Discounts $0 $0.00
5) Pooled Claims $100,000 Shock Level $0 $0.00
6) Paid Benefits HMOC Subscribers $1,301,307 $76.90
7a)Adjustment for Regional Contractual Savings ($324,170) ($19.16)
7b) Total Paid Benefits(2+3-4-5+6-7a) $1,321,169 $78.07
8) Reserve Adjustment $52,847 $3.12
9) Total Incurred Benefits(7b)+(8) $1,374,016 $81.20
10)Capitation Payments for HMOC Subscribers $507,668 $30.00
I I)Provider Risk Settlements $57,490 $3.40
12)Expected Pooled Claims $84,677 55.00
13)Total Chargeable Claims (9+10+11+12) $2,023,851 $119.60
14)Projected Experience(Line 13 'Trend Factor) Months of movement 17
Annual Trend 10.1%
Trend Factor 1.146 $2,319,333 $137.06
15)Expected Incurred Benefits for Groups with Like Characteristics $2,223,401 $131.39
16)Projected Blended Benefit Cost Credibility = 100.00%
Experience Incurred Claims(Line 14) $2,319,333 X 100.00% = $2,319,333
Like Characteristics Incurred Benefits(Line 15) $2,223,401 X 0.00% = $0
Total Blended Claims $2,319,333 $137.06
17)Required Premium Line 16 / 0.837 $2,771,007 $163.75
IS)Less PCS Rebates $141 $0.01
19)Net Required Premium $2,770,866 $163.74
20)Calculated Premium at Current Rates $2,019,812 $119.36
21)Required Rate Adjustment 37.2%
22)Applied Rate Adjustment 37.2%
09/02/98
Weld County Government
1999 Actual Renewal vs Rate Guarantee Analysis
BCBS/HMOC-1997/98 rates
HMO POS Custom Plus Total
Employee 597 $ 141.37 35 $ 148.74 4 $ 187.33 636
Family 226 $ 374.77 24 $ 394.16 1 $ 496.43 251
1997/98 Monthly Premium 823 $ 169,096 59 $ 14,666 5 $ 1,246 887 $ 185,007.40
Estimated Annual Premium $ 2,220,088.80
BCBS/HMOC-Actual 1999 rates
HMO POS Custom Plus Total
Employee 597 $ 148.16 35 $ 155.88 4 $ 196.32 636
Employee + Family 226 $ 392.76 24 $ 413.08 1 $ 520.26 251
1999 Monthly Premium 823 $ 177,215.28 59 $ 15,369.72 5 $ 1,305.54 887 $ 193,890.54
Estimated Annual Premium $ 2,326,686.48
1999 Actual Rate Increase 4.8%
BCBS/HMOC-1999 guarantee renewal rates
HMO POS Custom Plus Total
Employee 597 $ 148.44 35 $ 157.66 4 $ 202.32 636
Employee + Family 226 $ 393.51 24 $ 417.81 1 $ 536.14 251
1999 Monthly Premium) 823 $ 177,551.94 59 $ 15,545.54 5 $ 1,345.42 887 $ 194,442.90
Estimated Annual Premium $ 2,333,314.80
1999 Guarantee Rate Increase 5% 6% 8% 5.1%
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