Pre-Existing Condition Insurance Plan Washington State (PCIP-WA) June 2014 Financial Review

Transcription

1 Pre-Existing Condition Insurance Plan Washington State (PCIP-WA) June 2014 Financial Review 1. Financial Statements June 2014 U Sheet Cash on Hand at the end of June 2014 is $14 K. The entire $14 K is fully secured by FDIC insurance. Cash position is discussed further in the Budgeted Cash Flow section below. As of June 2014, the receivable for unbilled HHS reimbursements is $57 K. This amount represents an offset of liabilities, including IBNR, which will be invoiced and funded by HHS before the end of the program. The total IBNR of $55 K decreased $32 K or 36.8% as compared to the prior month. This increase is seen entirely in the medical portion as the IBNR for pharmacy is now at zero. U Statement In July 2013, the pool transitioned all membership to the federal PCIP program and began an eighteen month run-out. As a result, 2014 will not have any member months nor earned premium income and the 2014 expenses will be much lower than the prior year when the program still had active membership. As of the end of June 2014, the total incurred claim loss is $152 K which includes actual payments for run-out claims as well as the change in IBNR. The June 2014 YTD administrative expenses are $173 K and the HHS Reimbursements are $312 K. 2. Budgeted Cash Flow June 2014 The Budgeted Cash Flow document contains the budget (upper portion) as revised in February 2014 and the actual (lower portion) cash flow results year-to-date. The Program Summary (discussed below) is a dynamic report and therefore changes as better financial information is obtained. At the end of June 2014 the ending cash balance is $14 K. Total net cash receipts for June 2014 are $74 K or 18.2% favorable to budget primarily due to higher than anticipated reimbursements from HHS. Total June 2014 expenses are $93 K or 23.0% unfavorable to budget. Total medical claims expense is $142 K or 82.6% unfavorable to budget, and administrative variances discussed further below are $49 K or 20.8% favorable to budget. 08/07/2014 1

2 3. Administrative Expense Budget June 2014 For June 2014, administrative expenses are $49 K or 20.8% favorable to budget (cash basis). 4. PCIP-WA Program Summary June 2014 The program summary is a blended cash flow forecast tool that tracks the federally allotted funds throughout the life of the program. Actual claims, premiums and administrative expense data is input as incurred, while data for future months is based on the original budget. The summary shows the projected remaining balance at the end of each year as well as at the end of the program. The summary also compares the original budget figures to the blended forecast figures and calculates the blended administrative cost percentage (yearly and in total). PCIP-WA submitted a revised forecast in February 2014 and those re-forecasted figures were updated in the January 2014 packet. Actual results are illustrated through July As of July 2013, membership was transitioned to the federally ran PCIP pool and therefore PCIP-WA no longer has any active membership. In July 2013, PCIP-WA began to process run-out for claims incurred prior to July 1, As of July 2014, PCIP-WA has used up 4.9% of the current funding for 2014 and is projected to have enough funds to cover costs through the remainder of PCIP-WA and HHS will continue to monitor available funds and projections on a quarterly basis with new funds to be awarded as necessary. Administrative costs as a percent of total costs is 4.1% since inception of the program and, by the end of the program, that percentage is projected to be 4.3%. 08/07/2014 2

3 PCIP-WA Unaudited Sheet as of June 30 Total Enrollment : 0 Assets: Cash $ 13,923 $ - Premiums Receivable - 59,677 HHS Receivable - - Unbilled Payments from HHS 57,391 10,138,837 Prepaid Expense 12,650 12,650 Total Assets $ 83,964 $ 10,211,165 Liabilities and Unassigned Surplus: Reserve for Unpaid Losses - Medical $ 55,000 $ 7,137,000 Reserve for Unpaid Losses - Pharmacy - 1,249,000 Accrued Loss Adjustment 1, ,000 Premiums Received in Advance - 257,276 Checks Written in Excess of Cash (1) - 1,244,158 Due to WSHIP - - Abandoned Claim Reserve 13,669 4,440 Accrued Expenses 13, ,290 Total Liabilities $ 83,964 $ 10,211,165 Unassigned Surplus - - Total Liabilities and Unassigned Surplus $ 83,964 $ 10,211,165 (1) Checks Written in Excess of Cash are claim checks written prior to the receipt of HHS reimbursements. These checks are not distributed until the proper funding is received. 08/07/2014 3

4 Total - 6,330 Premium Earned $ - $ 4,505,740 Pharmacy Rebate 13,762 52,031 Incurred Claim Loss - Medical 154,155 16,506,524 Incurred Claim Loss - Pharmacy (1,751) 8,037,417 Total Incurred Claim Loss 152,404 24,543,940 Operating Expenses: PCIP-WA Unaudited Statement of Operations January 1 to June 30 Administrative Expense $ 87,580 $ 320,764 Variable Administrative Expense ,976 Salary and Benefit Expense 47, ,903 Contracted Outreach Fees - 24,670 Miscellaneous Expense 16,144 18,139 Professional Fee Expense 21,301 71,037 Start-Up Expenses - - Total Operating Expenses $ 173,072 $ 692,489 Underwriting Gain (Loss) $ (311,715) $ (20,678,658) HHS Reimbursement 311,715 20,678,658 Investment - - Other - - Changes in Unassigned Surplus $ - $ - 08/07/2014 4

5 PCIP WA Budgeted Cashflow 2014 Budget - Updated Feb 2014 JANUARY FEBRUARY MARCH APRIL MAY JUNE JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER JUNE YTD TOTAL Enrollment Count Cash BEGINNING OF MONTH Receipts Premium Receipts HHS Reimbursement 98,542 86,050 70,060 59,569 50,529 41,588 32,798 32,798 32,798 52,798 32,798 32, , ,126 Pharmacy Rebate Claim Refunds Receipts Investment Abandoned Claims Other Total Receipts 98,542 86,050 70,060 59,569 50,529 41,588 32,798 32,798 32,798 52,798 32,798 32, , ,126 Refunds Premium Refunds Total Refunds Expenses Medical Claim Expense 49,144 40,952 32,762 24,571 16,381 8, , ,000 Pharmacy Claim Expense Administrative Expense 29,500 25,200 17,400 15,100 14,250 13,500 12,900 12,900 12,900 32,900 12,900 12, , ,350 Variable Administrative Expense Salary and Benefits Expense 12,500 12,500 12,500 12,500 12,500 12,500 12,500 12,500 12,500 12,500 12,500 12,500 75, ,000 Contracted Outreach Fees Prescription Administrative Expense Miscellaneous Expense 2,231 2,231 2,231 2,231 2,231 2,231 2,231 2,231 2,231 2,231 2,231 2,231 13,386 26,772 Professional Fees 5,167 5,167 5,167 5,167 5,167 5,167 5,167 5,167 5,167 5,167 5,167 5,167 31,002 62,004 Total Expense 98,542 86,050 70,060 59,569 50,529 41,588 32,798 32,798 32,798 52,798 32,798 32, , ,126 Cash Month End $ - $ - $ - - $ - $ - $ - $ - $ - $ - $ - $ - Actual JANUARY FEBRUARY MARCH APRIL MAY JUNE JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER TOTAL YTD Enrollment Count Cash BEGINNING OF MONTH 33,233 17,048 17,517 27,644 14,448 13,669 Receipts Premium Receipts HHS Reimbursement 136, ,905 70,712 36,782 26,635 19, ,408 Pharmacy Rebate , ,762 Claim Refunds Receipts 6,629 15,442 6,090 2, ,911 41,209 Investment Abandoned Claims Other Total Receipts 143, ,348 90,310 39,543 27,010 29, ,379 Refunds Premium Refunds Total Refunds Expenses Medical Claim Expense 131, ,593 40,292 28, ,864 Pharmacy Claim Expense (1,751) (1,751) Administrative Expense 15,450 14,842 14,026 16,794 14,522 13,226 88,860 Variable Administrative Expense Salary and Benefits Expense 4,390 11,706 14,787 4,297 9,667 14,749 59,595 Contracted Outreach Fees Prescription Administrative Expense Miscellaneous Expense 7,429 2,035 2,569 1,286 1,414 1,400 16,133 Professional Fees 1,067 6,700 8,381 1,774 2, ,858 Total Expense 159, ,879 80,182 52,739 27,790 29, ,689 Cash 17,048 17,517 27,644 14,448 13,669 13, Checks written in excess of Cash Inc(Dec) in Abandoned Property Reserve Available Cash 17,048 17,517 27,644 14,448 13,669 13, /07/2014 5

6 PCIP WA Budgeted Cashflow 2014 Variance to Original Budget Favorable/(Unfavorable) JANUARY FEBRUARY MARCH APRIL MAY JUNE JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER TOTAL YTD Enrollment Count Receipts Premium Receipts HHS Reimbursement 38,340 48, (22,787) (23,894) (22,096) 19,070 Pharmacy Rebate , ,762 Claim Refunds Receipts 6,629 15,442 6,090 2, ,911 41,209 Investment Abandoned Claims Other Total Receipts 44,969 64,298 20,250 (20,026) (23,519) (11,932) 74,041 Refunds Premium Refunds Total Refunds Expenses Medical Claim Expense (82,216) (73,641) (7,530) (4,017) 16,336 7,204 (143,864) Pharmacy Claim Expense ,751 1,751 Administrative Expense 14,050 10,358 3,374 (1,694) (272) ,090 Variable Administrative Expense - - (127) (127) Salary and Benefits Expense 8, (2,287) 8,203 2,833 (2,249) 15,405 Contracted Outreach Fees Prescription Administrative Expense - (3) (3) Miscellaneous Expense (5,198) 196 (338) (2,747) Professional Fees 4,100 (1,533) (3,214) 3,393 3,025 4,375 10,144 Total Expense (61,154) (63,829) (10,122) 6,830 22,739 12,185 (93,351) Inc(Dec) in Abandoned Property Reserve Cash 17,048 17,517 27,644 14,448 13,669 13,923 Checks written in excess of Cash (17,048) (17,517) (27,644) (14,448) (13,669) (13,923) Available Cash /07/2014 6

7 PCIP-WA 2014 Administrative Expense Budget Variance Analysis Budget - Updated Feb 2014 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total ship (1) Administrative Expense (2) 29,500 25,200 17,400 15,100 14,250 13,500 12,900 12,900 12,900 32,900 12,900 12, ,350 Variable Administrative Expense (3) Salary and Benefits Expense (4) 12,500 12,500 12,500 12,500 12,500 12,500 12,500 12,500 12,500 12,500 12,500 12, ,000 Contracted Outreach Fees (5) RX Benefit Management Fees (6) Miscellaneous Expense (7) 2,231 2,231 2,231 2,231 2,231 2,231 2,231 2,231 2,231 2,231 2,231 2,231 26,772 Professional Fees (8) 5,167 5,167 5,167 5,167 5,167 5,167 5,167 5,167 5,167 5,167 5,167 5,167 62,004 Start Up Costs (9) Total Budget Operating Expenses 49,398 45,098 37,298 34,998 34,148 33,398 32,798 32,798 32,798 52,798 32,798 32, ,126 Actual Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec YTD Total ship (1) Administrative Expense (2) 15,450 14,842 14,026 16,794 14,522 13,226 88,860 Variable Administrative Expense (3) Salary and Benefits Expense (4) 4,390 11,706 14,787 4,297 9,667 14,749 59,595 Contracted Outreach Fees (5) RX Benefit Management Fees (6) Miscellaneous Expense (7) 7,429 2,035 2,569 1,286 1,414 1,400 16,133 Professional Fees (8) 1,067 6,700 8,381 1,774 2, ,858 Start Up Costs (9) - - Total Actual Operating Expenses 28,336 35,286 39,890 24,151 27,744 30, ,576 Variance Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec YTD Total ship (1) Administrative Expense (2) 14,050 10,358 3,374 (1,694) (272) ,090 Variable Administrative Expense (3) - - (127) (127) Salary and Benefits Expense (4) 8, (2,287) 8,203 2,833 (2,249) 15,405 Contracted Outreach Fees (5) RX Benefit Management Fees (6) - (3) (3) Miscellaneous Expense (7) (5,198) 196 (338) (2,747) Professional Fees (8) 4,100 (1,533) (3,214) 3,393 3,025 4,375 10,144 Start Up Costs (9) Total Variance Expenses 21,062 9,812 (2,592) 10,847 6,404 3,231 48,762 Notes: (1) New enrollment has been suspended as PCIP-WA is in runout. (2) Administrative Expense reflects fixed contractual TPA fees as well as contractual and performance bonuses per member for TPA, Utilization Management fees and Network services. (3) Variable Administrative Expense includes Case Management & Care Coaching, special mailings, and misc. system programming. (4) Salary and Benefits Expense reflect the combined amounts of the Executive Director, Deputy Executive Director, Executive Assistant and Program Coordinator. PCIP-WA reimburses WSHIP for 25% of salary and benefit costs and these figures reflect those reimbursements. (5) Contracted Outreach Fees is the outreach expenses billed from the Washington Office of Insurance Commissioner. (6) Prescription Administrative Expense is the administrative fees charged by the PBM. (7) Miscellaneous expense includes Board expenses, conference travel, insurance, agent commissions, phone/internet charges, and office expenses. PCIP-WA reimburses WSHIP for 25% of miscellaneous costs and these figures reflect those reimbursements. (8) Professional fees include legal fees, auditing fees, actuarial fees, and consulting. 08/07/2014 7

8 Pre existing Condition Insurance Pool PCIP WA Program Expense and Funding Summary (Highlighted cells represent actual data) Projected Budget Variance Claims less Refunds Claims PMPM Net Premiums Calculated Drawdowns 2010 Funding % of 2010 Funding Used Total Program 1,275,913 Federal Allotment 87,574, September % 17, , , ,848 1,075, % 87,373,427 October % 286,018 5,608 27, ,165 34, , , % 87,098,950 November % 260,978 3,070 66, ,682 91, , , % 86,812,577 December % 441,240 3, , ,458 77, , , % 86,415, Totals ,005,816 3, , , ,498 1,158, Admin % of Total Costs 28.7% in October 2010 is reduced by $18,380 of excess premiums from September "Total Program " column is populated with the most current contract amount. (June 2013) 08/07/2014 8

9 Pre existing Condition Insurance Pool PCIP WA Program Expense and Funding Summary (Highlighted cells represent actual data) Projected Budget Variance Claims less Refunds Claims PMPM Net Premiums Calculated Drawdowns 2011 Funding % of 2011 Funding Used Total Program 29,218,573 Carry forward 86,415, January % 531,845 2, , ,588 70, ,870 28,754, % 85,951,602 February % 632,702 2, , ,949 66, ,470 28,220, % 85,417,132 March % 1,461,569 4, ,714 1,158, ,912 1,279,767 26,940, % 84,137,365 April % 1,341,681 3, ,556 1,156,125 79,114 1,235,239 25,705, % 82,902,126 May % 1,217,756 2, ,713 1,020,043 89,865 1,109,908 24,595, % 81,792,218 June % 1,795,218 4, ,411 1,299,807 81,719 1,381,526 23,213, % 80,410,692 July % 1,216,882 2, ,438 1,015,444 36,539 1,051,983 22,161, % 79,358,709 August % 1,730,552 3, ,019 1,528, ,275 1,672,808 20,489, % 77,685,901 September % 1,552,438 2, ,316 1,305,122 61,438 1,366,560 19,122, % 76,319,341 October % 2,287,994 3, ,699 1,634, ,656 1,742,951 17,379, % 74,576,390 November % 2,203,600 3, ,938 1,985,661 65,031 2,050,692 15,328, % 72,525,697 December % 2,105,353 2, ,471 1,298,882 88,898 1,387,780 13,941, % 71,137, Totals 5,439 5,513 18,077,590 3,279 3,813,285 14,264,304 1,013,249 15,277, Admin % of Total Costs 5.3% Includes $29,101,463 available for 2011 plus $117,110 carryover from (Note: Even though the August 2011 reforecast reduced the 2011 contract amount, HHS had put $29,101,463 on the PMS based on the June 2011 reforecast. That amount remained on PMS and any excess will carry forward to "Total Program " column is populated with the most current projections which were submitted to HHS for approval in May /07/2014 9

10 Pre existing Condition Insurance Pool PCIP WA Program Expense and Funding Summary (Highlighted cells represent actual data) Projected Budget Variance Claims less Refunds Claims PMPM Net Premiums Calculated Drawdowns 2012 Funding % of 2012 Funding Used Total Program 75,137,918 Carry forward 71,137, January % 1,878,781 2, ,866 1,501,914 88,360 1,590,274 73,547, % 69,547,643 February % 1,985,778 2, ,966 1,748,812 79,859 1,828,671 71,718, % 67,718,972 March % 2,457,915 3, ,800 1,506, ,412 1,613,527 70,105, % 66,105,445 April % 3,270,512 4, ,274 2,949,238 94,225 3,043,463 67,061, % 63,061,982 May % 4,250,759 5, ,455 3,952,304 76,697 4,029,001 63,032, % 59,032,981 June % 2,782,652 3,305 1,046,198 1,736,454 78,658 1,815,112 61,217, % 57,217,869 July % 3,329,890 3, ,041 2,961,850 91,791 3,053,640 58,164, % 54,164,229 August % 3,327,890 3, ,264 3,030,626 80,460 3,111,087 55,053, % 51,053,142 September % 3,509,876 3,790 1,073,773 2,436,103 79,824 2,515,928 52,537, % 48,537,215 October % 3,547,164 3, ,780 3,061, ,114 3,167,497 49,369, % 45,369,718 November % 4,502,069 4, ,635 4,125, ,258 4,228,691 45,141, % 41,141,027 December 1,005 1, % 4,814,638 4,753 1,338,133 3,476, ,060 3,592,564 41,548, % 37,548, Totals 10,111 10,192 39,657,925 3,891 7,171,188 32,486,737 1,102,717 33,589, Admin % of Total Costs 2.7% "Total Program " column is populated with the most current projections which were submitted to HHS for approval in February Includes $61,196,899 available for 2012 plus $13,941,019 carryover from /07/

11 Pre existing Condition Insurance Pool PCIP WA Program Expense and Funding Summary (Highlighted cells represent actual data) Projected Budget Variance Claims less Refunds Claims PMPM Net Premiums Calculated Drawdowns 2013 Funding % of 2013 Funding Used Total Program 37,548,462 Carry forward 37,548, January % 4,978,987 5, ,374 4,395,612 86,015 4,481,627 33,066, % 33,066,835 February 1,035 1, % 3,463,230 3, ,563 3,153, ,540 3,267,206 29,799, % 29,799,629 March 1,106 1, % 3,899,721 3, ,342 3,244, ,467 3,360,846 26,438, % 26,438,783 April 1,058 1, % 4,052,480 3,664 1,455,523 2,596, ,471 2,749,428 23,689, % 23,689,354 May 1,013 1, % 5,511,610 5, ,712 5,212,899 93,230 5,306,129 18,383, % 18,383,225 June 969 1, % 4,320,882 4, ,255 4,137, ,034 4,245,660 14,137, % 14,137,565 July 2,398,790 2,646 2,396, ,831 2,519,975 11,617, % 11,617,590 August 474,361 (1,726) 476,087 95, ,479 11,046, % 11,046,111 September 381, ,522 56, ,536 10,608, % 10,608,574 October 607, ,057 37, ,393 9,964, % 9,964,181 November 182,563 (9,747) 192,310 40, ,788 9,731, % 9,731,393 December 8,640 8,640 51,969 60,609 9,670, % 9,670, Totals 6,157 6,330 30,279,842 4,143 3,476,942 26,802,900 1,074,778 27,877, Admin % of Total Costs 3.4% This amount includes excess funds carried forward from 2012 in the amount of $41,548,464 minus $4,000,000 of funds which were deobligated in June of "Total Program " column is populated with the most current projections which were submitted to HHS for approval in May /07/

12 Pre existing Condition Insurance Pool PCIP WA Program Expense and Funding Summary (Highlighted cells represent actual data) Projected Budget Variance Claims less Refunds Claims PMPM Net Premiums Calculated Drawdowns 2014 Funding % of 2014 Funding Used Total Program 9,670,784 Carry forward 9,670, January 124, ,731 28, ,067 9,517, % 9,517,718 February 99,150 99,150 35, ,437 9,383, % 9,383,281 March 20,694 20,694 39,890 60,584 9,322, % 9,322,697 April 25,827 25,827 24,151 49,978 9,272, % 9,272,719 May (330) 27,744 27,744 9,244, % 9,244,974 June (10,929) 30,167 30,167 9,214, % 9,214,807 July (3,070) 20,027 20,027 9,194, % 9,194,780 August 24,619 24,619 36,486 61,105 9,133, % 9,133,675 September 16,714 16,714 36,486 53,200 9,080, % 9,080,475 October 11,728 11,728 56,486 68,214 9,012, % 9,012,261 November 5,009 5,009 36,486 41,495 8,970, % 8,970,767 December 36,486 36,486 8,934, % 8,934, Totals 314, , , , Admin % of Total Costs 56.5% This amount includes excess funds carried forward from 2013 in the amount of $9,670,784. Inception to Date Actual Claims Net Premiums 2010 Totals 305 1,005, , , , Totals 5,513 18,077,590 3,813,285 14,264,304 1,013, Totals 10,192 39,657,925 7,171,188 32,486,737 1,102, Totals 6,330 30,279,842 3,476,942 26,802,900 1,074, Totals 256, , ,602 Inception to Date 22,340 89,277,245 14,712,926 74,578,648 3,800,844 ITD Admin % of Total Costs 4.1% Blended Summary (Includes Actual data with Forecasted Amounts) 2010 Totals 2011 Totals 2012 Totals 2013 Totals 2014 Totals Summary Claims less Refunds Net Premiums 1,005, , , ,498 18,077,590 3,813,285 14,264,304 1,013,249 39,657,925 7,171,188 32,486,737 1,102,717 30,279,842 3,476,942 26,802,900 1,074, , , ,032 89,335,315 14,712,926 74,636,717 4,003,275 Admin % of Total Costs 4.3% 08/07/