| May Board
News Details Retirement Board Actions and Discussion
Last week, the State Teachers Retirement Board held several committee
meetings, as well as its monthly meeting. Following regularly
scheduled board meetings, a report titled “Board News”
is posted on the STRS Ohio Web site, as well as sent to a number
of members and education organization representatives who have
requested it. As a registrant on the STRS Ohio news e-mail list,
you will also receive this report each month.
The May report follows.
STRS Ohio Board News — May 20, 2005
Board Receives
Election Results, Speas Honored for Board Service
As a result of the recent election, three new members will be
joining the State Teachers Retirement Board on Sept. 1, 2005.
Mary Ann Quilter Flannagan will fill a contributing member seat
on the board, while Jeff Chapman and Dennis Leone will fill the
retired teacher seats. Their four-year terms run through Aug.
31, 2009.
The May Retirement Board agenda included a resolution recognizing
W. David Speas for his service since being appointed to the additional
retiree seat on the board by Gov. Bob Taft on Sept. 28, 2004.
Board members expressed their appreciation for his commitment
of time and expertise in education and board governance on behalf
of the membership of STRS Ohio.
Retirement Board Approves Budgets
for 2005–2006 Fiscal Year
During its May meeting, the Retirement Board approved the budgets
for the 2005–2006 fiscal year (July 1, 2005–June 30,
2006). The operating budget, which totals $85,953,800, reflects
a 1% decrease from the 2004–2005 fiscal year budget and
is the lowest operating budget for the system in the past five
years. The capital budget totals $2,994,900. Allocations to the
State of Ohio include $325,000 for the Ohio Retirement Study Council
(the legislative oversight body for the public pension funds in
Ohio) and $25,000 to the Treasurer of State’s Office for
check processing. In reviewing the budgets, Executive Director
Damon Asbury noted that the board may revise them at any time
during the fiscal year.
Health Care Strategic Plan Adopted
A comprehensive Health Care Strategic Plan for 2007–2009
was adopted by the Retirement Board. This plan outlines steps
the board and staff will take to control medical and prescription
drug costs; encourage members to take an active role in managing
their health; and engage members in discussions regarding how
to fund health care coverage in the future. Extensive input was
provided by the Health Care Advocates for STRS during the development
of the plan. Future issues of the STRS Ohio newsletters, as well
as the STRS Ohio Web site, will present details about the plan’s
components.
Prescription Drug Management Program
Continued
During its May meeting, the Retirement Board approved the continuation
of the Prescriber Advisor program, which is a prescription drug
management tool. Using this program, an independent company analyzes
STRS Ohio’s prescription drug claims data and sends letters
to physicians, alerting them to any safety, compliance or drug
interaction problems their patients could experience.
Since the program began in September 2004, almost 35,000 letters
were mailed to more than 12,000 physicians, alerting them to potential
problems in their STRS Ohio patients’ drug therapy. The
changes made by these doctors resulted in savings of about $1.1
million to the STRS Ohio Health Care Program, while the program
fee for STRS Ohio during the same time period was about $94,000.
In addition, program participants benefited from the improved
safety and enhanced medical value of their prescription drug therapy.
LifeMasters Continues to Improve
Participants’ Health and Reduce Medical Costs
The second-year results for the LifeMasters Supported SelfCare,
Inc. program show that the program continues to improve the health
of its participants while reducing health care claim costs that
would have otherwise been incurred by the participants and STRS
Ohio’s Health Care Stabilization Fund. The disease management
program now involves nearly 6,900 people who are diagnosed with
congestive heart failure, diabetes, coronary artery disease or
chronic obstructive pulmonary disease. The total health care expenditures
(medical and prescription drug) for these individuals were $17.65
million lower than expected. After accounting for the fees paid
by STRS Ohio, the net savings was $15.32 million. This is in addition
to the more than $6 million in reduced claim costs experienced
in the first year of the program. The program evaluations for
each year were conducted by Health Data Management Solutions,
an independent third-party auditor.
Retirement, Investment Transactions
Approved
The Retirement Board approved the following retirements and investment
transactions:
- 27 disability retirements were granted.
- 78 active members were approved for service retirement; 45
inactive retirements were approved.
- In April, fixed-income purchases totaled $306 million, domestic
equity purchases totaled $1.774 billion and real estate purchases
totaled $59 million.
Additional Items Reported at the
Meeting by Executive Director Damon Asbury
ORSC Receives Positive Pension Funds Investment Report
at May Meeting
At its May meeting, the Ohio Retirement Study Council (ORSC) received
the semiannual investment report from its consultant, Evaluation
Associates. In commenting on the six months ending Dec. 31, 2004,
Evaluation Associates noted that all five Ohio public pension
systems posted strong investment growth, with STRS Ohio leading
the pack with a 9.21% total fund return. The report also noted
that STRS Ohio has outperformed its benchmark for the past one-,
three- and five-year periods. As part of his remarks to the ORSC,
Jeff Van Orden of Evaluation Associates noted, “…the
funds appear to be managed in a prudent fashion” and “…are
making efforts to keep costs down.”
Coalition Presents Mandatory Coverage Briefing to Senate
Staff
STRS Ohio, through the Coalition to Preserve Retirement Security
(CPRS), is working hard to make sure mandatory Social Security
coverage of state and local government employees does not become
part of anyone’s solution as the sides continue to do battle
over Social Security reform. A briefing for U.S. Senate staff
was held on May 13, 2005, in Washington, D.C. The presentations
contained strong arguments against mandatory coverage and the
harmful impact it would have on the states.
Return to the list of STRS Ohio news e-mails
sent in 2005. |
