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Minutes of Benefits Advisory Committee (BAC): August 25, 2011

Attending: Lise Sanders, Amy Diehl, Heather St. Germaine, Yaniris Fernandez, Jerry Bohdanowicz, Shelly Ruocco, Hilary Clark, David Hoffmann (Strategic Benefit Advisors (SBA))

Other BAC members not in attendance: Steven Roof

I. Introduction

The group was given the opportunity to review minutes and ask follow-up questions from the June 21, 2011 BAC meeting. 

II. Life Insurance 

The BAC continued the discussion of life insurance plan design changes that were proposed at the June 21, 2011 BAC meeting, changing the multiple of salary based on age to a fixed multiple of salary for all employees regardless of age. This change is in line with how other schools in the valley and nationally structure their life insurance plans.  The College realizes a premium savings under the proposed 1.5 times basic life program. We intend to keep the benefit savings realized through this change in the overall benefits budget (reallocating the money to other benefit programs). The BAC looked at the impact of the proposed basic life change on employees at various ages and salary levels. The proposed 1.5 times basic life benefit results in some employees seeing a reduction in coverage, some employees seeing an increase in coverage and some employees seeing no impact to current coverage levels. One member noted that if health insurance changes were more affordable for families, a big win for employees on campus, employees might be less concerned with having a reduction in life insurance coverage provided by the College. Employees would have the option to "buy up" through the addition of supplemental life insurance allowing employees to purchase coverage up to five times the employees' current salary with a maximum benefit of $300,000. SBA will provide data on changing the multiple to 2.0 times salary for all employees and the BAC will continue to explore this change and come to a final recommendation for Shelly at the September BAC meeting for a January 1, 2012 effective date. 

The BAC recommends to Shelly adding supplemental life insurance to the College's benefits offering, thereby giving employees an opportunity to buy additional life insurance starting January 1, 2012. 

III. Health Insurance 

Hampshire College received a 9.9% renewal increase from Tufts, effective January 1, 2012. The 2012 renewal was initially expected to increase 12%-14%, but our loss ratio improved and SBA's negotiations lowered the annual increase. The definition of a loss ratio is the total amount of money paid out in claims divided by the total premium paid for health insurance by the College and employees. Health plans generally target a loss ratio of 0.89-0.90 for groups of Hampshire's size. Our loss ratio was at 0.99 earlier in the year but has improved to 0.96 over the most recent 12 month period. Annual medical trend used by the health plans is currently 8%-10%. 

David Hoffmann presented the impact of a new low cost HMO plan that may be added as an additional choice to our current HMO and PPO plans. The biggest "plus" of this plan is that deductions per pay period would be lower than in our other plans. This low cost option has similar benefits to our current HMO plan, with slightly higher copayments and a deductible that applies to in-patient and out-patient hospital care and high-tech imagery. SBA will need to provide a more detailed breakdown of what exactly is included or excluded in the deductible, so that employees can be very clear about when the deductible applies so that employees can make an informed decision about health insurance for the upcoming year. The BAC was in agreement that this is a positive opportunity to offer employees more choice when it comes to health insurance plan options, especially one that costs less per pay period than our current plans will cost in 2012. Adding this third option does not cost the College any more money than offering just the two current plans (nor does it save the College any money). The BAC focused on the importance of communication about this plan when it is rolled out to the community and stressed the need to articulate to employees that this plan is not replacing the current HMO plan, it is being offered in addition to the current plan. 

The BAC recommends the addition of the low cost option HMO to the current health insurance plan offerings effective January 1, 2012. 

Hampshire's current employee contribution for individual HMO coverage is lower than other colleges and universities in the valley (Hampshire employees pay less). However, Hampshire's current employee contribution for two-party and family HMO coverage is higher than other colleges in the valley (Hampshire employees pay more).  Hampshire employees currently contribute 13% of the cost for individual coverage (the College pays 87%).  David Hoffmann showed models where employee contribution allocations varied, showing the individual plan with 13%, 15%, and 17% employee contribution rates and those differences providing some reduction to two-party and family plan contributions. The BAC felt the more conservative shift to 15% for the individual plan was reasonable, which allows the two-party and family employee contribution rates to decrease from 35% to 34%. 

The BAC recommends the adjustment of individual, two-party and family plan employee contribution amounts effective January 1, 2012. This is a progressive step to close the gap between individual and family contribution amounts, thereby reducing the burden on two-party and family plan participants with a very minor effect on individual plan participants. This change gets the College more in line with valley peers and the employee contributions rates charged at the other schools. 

IV. Flex Time 

Shelly presented a draft of the Hampshire College Staff flexible work arrangement policy. The policy provides details on the definition of flexible work arrangement. The upside of having a policy around flex time is the agreement between employee and supervisor/department and clarity of expectations with regard to the arrangement and work performed as well as periodic review of the arrangement. Exempts and non-exempts may participate. A person's job is evaluated to determine the possibility of flexible schedule and/or telecommuting opportunities. When considering a flexible work arrangement the supervisor and supervisors' supervisor will evaluate the job responsibilities not reason for the request. A department may develop core hours that everyone in the department must work as department needs necessitate. This policy provides employees with a process by which to apply for a flexible work arrangement and a process for supervisors to evaluate the opportunities and challenges proposed. The employee must have demonstrated satisfactory work performance and ability to work with limited supervision prior to applying for a flexible work arrangement. An arrangement will take a lot of communication, trust and supervision of the plan, expectations and work product. This results-oriented model is very popular in the private sector. The BAC agreed the draft policy is ready for community feedback. 

V. Faculty FMLA 

In May 2008, a proposal for a faculty family leave policy was presented to faculty and passed on to human resources for review by the benefits advisory committee (not in existence until May 2011). The original proposal was signed by over half of the faculty at that time. The proposal specifically spoke about "family leave" (maternity, paternity, and adoptive) as well as leave to care for an ill parent or family member.  The purpose of the proposed policy was to put into written form the existing practice making the process of family leave arrangements transparent and equitable across and within schools. There is a need to ensure consistency and equitableness. The proposal was written as family leave, but the committee that worked on the proposal as well as the BAC both see that there is opportunity and a need to expand the policy to cover other FMLA situations. 

This discussion on faculty FMLA was short; the BAC was given homework to read the proposal for a faculty family leave policy as well as FMLA rights and responsibilities and FMLA policy in the employee manual for a continued conversation at our next BAC meeting in September. 

The last topic on the agenda 24 v. 26 benefit deductions for biweekly payroll was not covered at all at this meeting, but all members left with material to read in order to discuss at the September meeting.   

The BAC will meet again on Thursday, September 22, 2011, from 9:00 a.m.-10:30 a.m. Please send all comments about these minutes to and your comments will be shared with the committee.




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