The Midwestern Pennsylvania School Employee Benefit Trust (MPSEBT) was formed in June, 1982 for the purpose of self-insuring health and welfare benefits to member participants’ employees. Eligible participants include any unit established by the laws thereof, which is an employer of persons in Butler, Lawrence, and Mercer Counties who carry out free public education.
A self-insured trust providing health and welfare benefits can best be understood by defining each component.
This term relates to an organization assuming on its own, some or all of the financial risk of certain occurrences. In this case, the occurrence is employee health, dental and vision benefits. Self- insurance is different than conventional insurance in that the employing organization assumes most or all of the risk rather than paying someone else to assume it.
The trust is a governing body responsible for managing claims payment and other related activities. The trust board receives the funds, oversees the operations of the trust and ensures the smooth functioning of claims administration. Represented on the trust board at this time are professional/support employees, administrative and fiscal officers of each employer. The trustees cannot effect any change in an employer’s schedule of benefits without the approval of a majority of trust members and the consent of the employer.
The term refers to any type of medical, dental, vision, prescription drug or related benefits.
Instead of paying premiums to an insurance company, the employer deposits claim contributions into the “Midwestern Pennsylvania School Employee Benefit Fund”. These contributions together with interest earnings cover the cost of expected employee claims and administrative expenses of the trust.
An administrator is retained by the trustees to examine, review and prepare checks. This administrator keeps all claims records and corresponding files, the administrator also advises the employers on levels of contributions necessary to maintain the financial stability of each employer’s account within the trust. The administrator keeps the trustees up-to-date on benefit matters and provides the trust with management advice and support. The administrator also negotiates discounts on the payment schedule for major claims. Administrative services are retained on a fee basis predicated on a charge per employee per month.
Highmark Blue Cross Blue Shield serves as administrator of the health program for Midwestern Pennsylvania School Employee Benefit Trust. The Highmark PPO Blue, preferred-provider program may be accessed by calling Member Services at 1-800-241-5704 or by accessing Highmark at www.highmarkbcbs.com. Claims may be submitted to Highmark Blue Cross Blue Shield, P.O. Box 3355, Pittsburgh, PA 15230-3355.
Medco Health Home Delivery Pharmacy through Highmark Blue Cross Blue Shield manages the pharmacy benefit. Medco Health Member is available 24 hours a day seven days a week, at 1-877-782-7862 or online: www.medcohealth.com.
Meritain Health Services serves as administrator of the dental program. Customer service for inquiries regarding eligibility, claims and plan benefits may be accessed by calling 1-800-828-6922 or visiting www.meritain.com. Claim submissions may be directed to Meritain Health, P.O. Box 853921, Richardson, Texas 75085-3921.
Vision Benefits of America, 300 Weyman Plaza, Pittsburgh, PA 15236-9937 is administrator of the vision plan. Employees may contact Vision Benefits at telephone number 1-800-432-4966 or online at www.visionbenefits.com. Vision benefit forms are also available in the business office.
The self-insured trust is as financially sound as any conventional insurance arrangement. Confirmed by audit of Mark C. Turnley, CPA, the MPSEBT has accumulated a fund balance of $302,125 at June 30, 2005. Participating employers share ownership of any existing fund balance at the time that the trust is dissolved predicated on years of participating and actual contributions. Each employer is responsible for adequately funding its particular benefit plan but does not share in the liability of any of the other individual plans. Individual plans are the responsibility of the individual participating employer. Health plan participants are protected through the purchase of reinsurance and do not pose a risk to supplemental program participants. Individually, each participating employer retains ownership of any funds on had in its particular account. Refunds of excess dollars are made when individual account balances exceed three months or reserve as determined through use of the last completed year’s claims plus administrative costs.
There are several advantages of participation in the MPSEBT. The first is stability. Since all funds provided by the employer to the Trust are “pooled”, each employer is protected from having a particularly heavy claim year reflected on its individual contribution rate. Second, trustees and employers control the fund, its level, and use. Third, the trustees and employers know the claims experience, the fund reserve and other financial aspects of the plan, as the figures are reported routinely. Fourth, claims cost, and fees are budgeted and continually monitored. Fifth, any revenue earned from the temporary investment of uncommitted funds in the Trust accrues back to the trust fund. In fact, interest earnings are being used to offset $.50 per employee per month in administrative fee expense per participant. Under conventional insurance, the employer never sees investment revenue, since the insurance company retains these monies.
To participate in the Midwestern Pennsylvania School Employee Benefit Trust, an employer simply approves a Trust Agreement (agreement by employers which detail actuarial, legal, consultant and duties/powers of trustees), names a trustees and provides enrollment information and the appropriate schedule of benefits.