BUCK CONSULTANTS, LLC 3-2012 - Laserfiche WebLink

Home Browse Search

Ms. Bich D. Ta May 10, 2012 Page 3 • Confirmation of the eligibility rules for retiree coverage (for example, age 50 plus 1 O years of service) • Confirmation of the contribution formula and current contribution amounts for retirees/spouses • Current rates by medical plan and rate tier for active and retired employees; historical rate increases for the prior two or three years • If rates are blended between active and retired employees, any claims experience reports that show the relative cost difference between the two groups Buck will use its valuation software to develop the liability for current retirees, active employees who currently meet the eligibility requirements for retiree medical, and active employees who do not yet meet the eligibility requirements for retiree medical coverage. We will then develop a formal report that will show the following information: • Present value of the total liability for the City under varying health cost trend scenarios • Unfunded accrued actuarial liability (the UAAL) for over and under age 65 • Annual required contribution (ARC) under varied amortization schedules • Cash flow projections for the life of the current active and retiree population • Analysis of various funding strategies and their funding cost impact • A complete description of the assumptions that underlie the valuation • A glossary of common terminology used in retiree medical valuations Once the valuation report is complete we will submit a draft report to you for review. We will discuss the reports with you and incorporate your comments into the final reports. The expected time needed to complete each valuation is four to six weeks after receiving the census data described above. Total All-Inclusive Maximum Price This section outlines the expected cost for this project. As a consulting firm, we charge fees for our services on a time and expense basis so that our clients are assured of receiving maximum value. Buck will perform this project on a time and expense basis, with a limit on our fees to a guaranteed amount. We will charge only for the amount of work actually performed.