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Public Employees' Benefit Board Meeting Minutes, Sept. 18, 2007
Public Employees’ Benefit Board
Tuesday, September 18, 2007, 10:30 a.m. to 4:30 p.m. - Minutes
DAS General Services Building, Basement/Mt Mazama Room
1225 Ferry St SE, Salem

Board Members Present
Peter Callero
Rocky King
Paul McKenna
Sue Nelson
Rich Peppers
Jeanene Smith
Bret West
PEBB Staff Present
Bobbie Barott
Dena Comer
Wendy Edwards
Lydia Lissman
Brian Olson
Margaret Smith-Isa
Rebecca Sweatman
Jean Thorne
Guests Present
Thandi Clements, VSP
Dave Ford, CareOregon
Claudia Grimm, OR Medical Ins. Pool
Diana Jones, Regence BCBSO
Tom Jovick, OR Medical Ins. Pool
Kristina Herron, Providence Health Plans
Sally Hill, Providence Health Plans
David Labby, CareOregon
Bill Lindekugel, Kaiser Permanente
Paul Pfinster, AFLAC
Sara Rengler, Willamette Dental
David Scearce, The Standard Insurance Co.
Tamara Strauss, Samaritan Health Systems
Margaret Thornberg, BenefitHelp Solutions
Deborah Tremblay, Oregon Judicial Dept.
Consultants Present
Paige Sipes-Metzler, Aon Consulting
Barbara Wall, Aon Consulting
Welcome and Approval of Minutes: August 21, 2007
Overview of Meeting
New Programs: Regence Back Care Program 2008/Ashville Project (READI)
CareOregon’s Primary Care Redesign
Achieving the Vision Part I: Kaiser and Providence
Rural Subsidy
2007 Open Enrollment Planning
Prescription Drug Trends – 1st Half of 2007
Standard Demutualization Settlement
Board Business
OregonHealth Fund (SB 329)
General Public Comment
Welcome and Approval of Minutes
Jeanene Smith called the meeting to order.
Rocky moved to approve the August 21, 2007, meeting minutes.
Rich Peppers seconded the motion.
Hearing no further discussion, the motion passed unanimously.
Overview of Meeting
Jean Thorne explained that today’s meeting will include a report on Regence’s back care program for 2008 and an update on the Regence Education and Assessment for Diabetes (READI) pilot. The Board will then hear a presentation on primary care redesign from CareOregon, followed by a status report on Kaiser and Providence regarding their achievement of PEBB’s Vision. The Board will also hear data regarding the rural subsidy policy and discuss next steps for 2009. They will then hear the status of the 2007 open enrollment planning and receive data on the generic drug prescribing rates for all plans for the first half of 2007. The Board will take action regarding the Standard Insurance Company demutualization settlement, and will hear an update on the implementation of Senate Bill 329. The Board will also take action on election of the Vice-Chair, and the Chair will make appointments to the Operations Subcommittee.
New Programs: Regence Back Care Program 2008/Ashville Project (READI)
Regence Back Care Program
Rebecca Sweatman explained that the Regence population-based back care proposal included identifying high-risk individuals, providing physician support tools, and working with PEBB staff to develop communication strategies for prevention as well as member education about the myths and facts of back pain and treatment. It also included outreach to PEBB membership at the workplace in collaboration with the state’s safety, disability, and Worker’s Compensation programs. PEBB will have its first meeting with Regence on Friday September 21, and PEBB staff will meet with Regence twice monthly through the beginning of 2008 to discuss program implementation. Specifically, discussion will include how to work with DAS Risk Management and engage the agencies in the program. PEBB staff will provide status reports to the Board as the information on the program becomes available.
Rocky King asked about the status of the Council of Innovators’ work to examining the evidence related to the treatment of back problems.
Jean Thorne replied that the Council had several meetings on this last year, working with groups such as Puget Sound Health Alliance, who had not yet determined appropriate guidelines. Guidelines may have been adopted since that time, but follow-up would need to be done.  
Rebecca Sweatman explained that at the first meeting Aon will provide data on back pain and surgery, and Health Dialogue will provide additional data on predictive modeling.
Rocky King suggested that this could be an opportunity to bring in other partners such as SAIF.
Regence Asheville Pilot (READI)
Rebecca Sweatman referred to Bdattach.2 and explained that PEBB staff met with Regence in July and early September 2007 to discuss program planning for the proposed Regence Asheville Pilot, approved by the Board in the 2008 renewals. She reported that the pilot program has been renamed the Regence Education and Assessment for Diabetes Improvement (READI), and the location for the pilot will be the Eugene/Springfield area. She outlined the details of the program including how it will work, participants, and pharmacy selection and training. The following reports will be provided to the Board in the future:
  1. A mid year report from Regence in late July 2008 will include information on the number of members enrolled, demographics, baseline and results on A1c, cholesterol, blood pressure, percent with current flu shots, foot exams, eye exams, and percent achieving nutrition, exercise and weight goals.
  2. A Patient Satisfaction Survey of Pharmacist Care (using 5-point Likert scale) will be administered to pilot participants. Survey results will be reported after the first 6 months, and annually thereafter.
  3. A pilot evaluation will be completed the first year. In addition to information on enrollment figures and clinical indicators, it will include baseline pharmacy and medical claims cost analysis.
Jeanene Smith asked how the coordination between the pharmacy and primary care would work and how the pharmacies would identify the primary care physician, even when the prescription lists another provider.
Rebecca Sweatman replied that the member would provide that information when they start with the program.
Jean Thorne asked if the type of data reported in this program could also be captured for other diabetics who are receiving services from Advicare, but who are not part of this pilot. 
Rich Peppers asked if the data captured in the program could be compared to results from the Oregon State University study.
Rebecca Sweatman replied that the clinical results may not be public yet, but she will follow up.
Rich Peppers suggested that the unions could do an article in the newsletter for the Eugene area, perhaps targeting the University of Oregon.
Rebecca Sweatman agreed to follow up on the issues brought forward, and to provide additional information from the Asheville study to Bret West.

CareOregon’s Primary Care Redesign
David Ford, Chief Executive Officer, and Dr. David Labby, MD, Medical Director of CareOregon explained that the purpose of today’s presentation is to provide context of the work CareOregon is doing around medical home and integrated care. CareOregon serves Oregonians enrolled in the Oregon Health Plan (OHP) who have selected them as their health plan. They are committed to providing access to high quality, cost-effective and culturally competent care for their members, and to supporting the providers who care for them. They serve approximately 100,000 Oregonians in 14 counties, and are committed to strengthening the safety net delivery system to assure that they have the funding and infrastructure to expand services and effectively address the needs of uninsured and underinsured Oregonians. CareOregon was founded by the Oregon Health Sciences University (OHSU), the Oregon Primary Care Association, and Multnomah County. Additional information can be found by visiting CareOregon’s Web site, at www.careoregon.org.
Peter Callero asked for an explanation of the cost savings.
David Ford replied that the savings are in keeping high-risk patients out of the hospitals by keeping them stable and out of crisis.
Jean Thorne asked how CareOregon’s principles could be translated to a commercial population.
David Ford explained that the next cohort will involve the pediatric population. CareOregon is looking to alliances and collaboration throughout Oregon’s healthcare system in order to address the necessary market share.
Rich Peppers asked if there has been pushback from those patients who are used to seeing their physician versus another member of the healthcare team.
Dr. Labby replied that it’s patient-centered and it’s up to the patient to decide what they want to do.
Achieving the Vision Part I: Kaiser and Providence
Margaret Smith-Isa referred to Bdattach.3 and Bdattach.4 and explained that today’s reports summarize key criteria that were identified as “minimum requirements” and “high rating” within each of the seven Vision domains during the Request for Proposal (RFP) 7210 evaluation process, as well as a summary of the status of PEBB Vision implementation for Kaiser and Providence. 
She explained that in reviewing the criteria within the domains, there are certain themes that transcend the domains in multiple areas, including:
  • Electronic Medical Records (EMR) and their functionality;
  • Reporting – what plans are reporting, at what level, and to whom;
  • Identifying and intervening with high-risk members; and
  • Member tools available to assist members in self-management.
She provided an overview of what the plans are doing to address these common themes.
Rich Peppers asked about Kaiser’s progress since the original RFP scoring.
Margaret Smith-Isa replied that Kaiser’s work in medical home and their efforts toward redesigning primary care have gone much further than laid out in the RFP.
Paul McKenna would like to know the percentage of members with a medical home at the time of the RFP.
Jean Thorne commented that PEBB could benefit from work toward further defining and developing the concept of medical home.
Rural Subsidy
Lydia Lissman referred to Bdattach.5 and explained that the information provided today is in response to a Board request for follow-up information, for consideration as the Board plans its work for 2009.
Barbara Wall of Aon explained that PEBB has offered a subsidy to members receiving care in 20 “rural” counties. In those counties, PEBB members are able to access all providers at the preferred benefit level, regardless of the provider’s contract status with Regence (the only plan available in those counties). The subsidy was established due to assumed access issues. When a Rural subsidized member selects Regence, they are assigned to the participating panel and are required to pay a straight 15% co-insurance when seeing contracted providers. The factors that differentiate this arrangement from the PPO arrangement are:
  1. PPO members pay 15% or 30% co-insurance based on the provider’s contract status with Regence; and 
  2. The participating panel provider has a higher allowable amount on which the co-insurance is based, even if the provider is also a PPO provider.
The Board discussed their policy objective in considering a rural subsidy for 2009, and if there are other mechanisms that would be more appropriate to accomplish that objective.
Jeanene Smith asked if PEBB could use a system based on zip code versus county. Parts of some counties may be rural, but other parts may be urban.
Rocky King inquired about cost.
Barbara Wall replied that the cost is difficult to determine without reprocessing the claims.
Lydia Lissman explained that there would be no significant increase in premiums with the rural subsidy.
Rocky King expressed his concern about contracting leverage and would like to have more information from Regence.
Jeanene Smith asked what Washington does to address their similar rural issue.
Lydia Lissman replied that PEBB will look into it. She also suggested that Regence attend a future Board meeting to determine if there are any additional issues that need consideration.
Rocky King suggested that while he doesn’t support a policy change, the list should be examined to see if there are counties that should be either added or removed.
Rich Peppers referred to slide 9 and requested more specific numbers regarding who is or isn’t being disadvantaged.
Lydia Lissman replied that PEBB staff would follow-up on these issues for a future Board meeting, including inviting Regence for a discussion.
2007 Open Enrollment Planning
Bobbie Barott referred to Bdattach.6 and provided a report on the status of the 2007 open enrollment planning. She outlined PEBB’s accomplishments, including the release of all open enrollment information on September 1, which is one month earlier than last year. New this year were posters reminding members about open enrollment, sent to all agencies statewide. She reported that planning for Webinars is underway, and a member survey will go out in November. The Board will be presented with the results of the survey in early 2008.  
Rocky King stated that this is the smoothest open enrollment planning process and complimented PEBB staff on their hard work.
Prescription Drug Trends – First Half of 2007
Margaret Smith-Isa referred to Bdattach.7 and briefly reported on prescription drug trends for January through June of 2007. She explained that in 2006 PEBB made significant changes to the prescription drug benefit, implementing a tiered co-payment structure in which members who elect to use non-preferred brand name drugs pay significantly higher co-payments when a generic or preferred brand alternative is available. After implementation of this benefit change, the Board requested periodic reporting from health plans on PEBB member generic, preferred brand, and non-preferred brand utilization rates to allow monitoring of utilization trends over time. Today’s update includes the most recent data provided by plans, reflecting prescription drug utilization for the first half of 2007 (January 1 – June 30). Kaiser and Regence have provided data going back to 2003, to offer historical context regarding drug utilization trends over the past several years. Providence and Samaritan provided data beginning in 2006, when their PEBB contracts began. Overall, plans’ data generally show that progress in moving PEBB members to generic prescription drugs has been sustained or has increased slightly in the two most recent quarters. She provided highlights of the data of prescription benefit utilization and costs for each plan.
Paul McKenna asked if the data could be broken down to reflect plan versus member costs.
Jeanene Smith noted that it appears Samaritan members are not using their prescription drug benefit, as the data shows about half of usage reflected in other plans.
Jean Thorne replied that PEBB staff will research the Samaritan data.
Rich Peppers asked if there has been any feedback from members around co-pay exceptions.
Bobbie Barott replied that phone calls and E-mail to Member Services have been very quiet on this issue.
Standard Demutualization Settlement
Charles Fletcher of the Oregon Department of Justice (DOJ) recommended that the Board approve a settlement agreement that has been negotiated with OHSU and is now pending in Marion County Circuit Court, and that the Board’s Vice Chair sign the agreement on behalf of the Board.
Rocky King moved to approve the DOJ’s recommendation to approve the settlement agreement as outlined by DOJ staff, and to authorize PEBB’s Vice Chair to sign the agreement.
Rich Peppers seconded the motion.
Hearing no further discussion, the motion passed unanimously.
Paul McKenna asked how the money will be distributed.
Lydia Lissman replied that the money will be held in a separate trust account, and the Board must decide how it will use those funds in a future Board discussion.
Board Business
Election of Board Chair and Vice-Chair
Jeanene Smith explained that with her work on SB 329 she will be unable to continue serving as PEBB’s Vice-Chair. Sue Nelson has volunteered to assume the Vice Chair position.
Rocky King moved to approve a six-month extension (until July 1, 2008) of Diane Lovell as Board Chair, and Sue Nelson as Vice-Chair effective immediately.
Peter Callero seconded the motion.
Hearing no further discussion, the motion passed unanimously.
Operations Subcommittee Appointments
Bret West and Rocky King agreed to join the Operations Subcommittee.
Staff Update
Larie Nicholas began on September 17 as PEBB’s Administrative Specialist, reporting directly to Wendy Edwards. In addition to supporting Wendy and the PEBB Operations Team, Larie will staff the Operations Subcommittee.
Other Business
Lydia Lissman reported that a special Board meeting will be held just prior to the October 9 Operations Subcommittee meeting for the purpose of acting on the staff recommendation to issue a letter of intent to award the consultant contract to the Apparent Successful Proposer. The Board will also take action on the Recruitment Selection/Screening Committee’s recommendation regarding the PEBB/OEBB Administrator position.
Jean Thorne reported that OEBB recently met to review statute and develop their Vision, which focuses not only on cost, but also on quality, outcome and service. OEBB has made a great start under tight deadline.
OregonHealth Fund (SB 329) 
Barney Speight, Executive Director of the Oregon Health Fund Board, provided the background leading to the Board’s inception as a result of Senate Bill 329 (SB 329). He explained that the seven-person board, confirmed by the Senate, includes one provider as well as five subcommittees, which will be staffed by ex-officio members representing hospitals and other stakeholders.
The Delivery System Reform Committee will focus on finding new strategies for an improved delivery system through efficiency, effectiveness, and transparency. Two additional workgroups will address quality and transparency. He explained that the current delivery system is unsustainable, and the reform of the system will lie with the purchasers. He added that collectively, purchasers must partner with the private sector to change the system.
The Benefits Committee will examine and design an essential benefit package, looking closely at affordability. There will also be a Committee on Eligibility and Enrollment, as well as a Federal Policy Committee, which will develop a report identifying the impediments to SB 329 in Oregon. 
The Board must deliver a comprehensive plan to the Governor, along with prospective legislation to move the plan forward, by October 1, 2008. Ultimately, this work will frame most of the health debate in 2009.
A possible role for PEBB would be to add strength to the debate for system reform. PEBB is a major purchaser in Oregon, and a change to the cost curve of 3-5 percent would result in huge savings.
He commended PEBB and its work toward its landmark Vision. He would appreciate PEBB’s reaction as steps are taken by the Health Fund Board.
Jean Thorne asked if evidence-based plan design will be part of the discussion and, if there would be room for PEBB to join in.
Barney Speight replied that as a public purchaser, PEBB can drive this effort and others in the private sector will follow. There is a duty to the taxpayer to manage a benefit design, and collaboration is essential given the public suspicion around evidence-based care.
General Public Comment
Meeting Adjourned