Benefits committee adopts system for groups wanting to leave program

After four years of battling, a group of more than 350 Nevada Highway Patrol and other public safety employees is three months from a decision on whether they can leave the Public Employee Benefits Program.

The committee Thursday agreed actuaries should study the actual historic claims experience of groups that want to leave the state-operated program to determine the effect of their departure on everyone else.

That study is necessary because the law approved by the 1999 Legislature allows groups of 300 or more to leave the program and get their benefits elsewhere but bars them from leaving if doing so would increase the rates paid by those still in the plan by 5 percent or more. The troopers say they can get better and cheaper health benefits from the Teamsters International program.

Opponents of the highway patrol plan said that's because they planned to take only young, healthy troopers and their families. They argued that would force an increase in rates for those left with state plan, which would be left with a higher percentage of older, more illness prone workers as well as retirees who require some of the most expensive health services.

The situation was finally resolved when Teamsters Local 14 in Las Vegas agreed to take a proportionate number of highway patrol retirees along with them. Union representative Gary Wolff said Thursday's decision clears the way for a committee vote in November to allow them out. Wolff said that's important because, by statute, unless the decision is made before the end of the year, the group must wait another full year to make the break from the state system.

Wolff testified the union supports the proposed methodology.

"Our biggest problem has been how are they going to determine the 5 percent," he said. "How are they going to work out the effect."

Actuaries from AON say the system has been successfully used to determine rates by major insurance companies for several years. That company will perform the actual rate impact analysis for the state plan.

AON officials also told the board they would recommend using the same methodology to develop overall rates for the entire program. The system develops premium rates for both the group seeking to leave the plan and the remaining population of insured workers using actual historical claims experience for the past three years. When the two rates are compared, the impact on those still with the plan must be less than 5 percent before the group can be allowed to leave.

Wolff said the group hoping to join the teamsters plan includes not only NHP employees but parole and probation, the Nevada Division of Investigations and scattered employees from other agencies as well as a group of retirees.