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May 22, 2003
Room 302
State Capitol
Cheyenne, Wyoming
Senator Cale Case, Chairman;
Senator John Schiffer;
Representatives Elaine Harvey, Larry Meuli and Phil Nicholas.
John Rivera, Senior Staff Attorney, and Bill Mai, Senior Legislative Analyst.
Please refer to Appendix 1 to review the Committee Sign-in Sheet for a list of other individuals who attended the meeting.
Senators Irene Devin and Mike Massie
All meeting materials and handouts provided to the Subcommittee by the Legislative Service Office (LSO), public officials, lobbyists, and the public are referenced in the Meeting Materials Index, attached to the minutes. These materials are on file at the LSO and are part of the official record of the meeting.
Chairman Case called the meeting to order at 8:45 a.m.. The following sections summarize the Subcommittee proceedings by topic. Please refer to Appendix 2 to review the Subcommittee Meeting Agenda.
Mr. Richard Bredehoff and Mr. Lin Bashford, Wyoming Game Wardens' Association, distributed Appendix 3, consisting of: 2003 Senate File 68, State employees-sick leave reimbursement; a proposal to convert unused sick leave to paid health insurance premiums; data regarding the cost of the proposal; and, information about other states' programs that allow such conversion. They explained the proposal would allow a person who has unused sick leave in excess of 960 hours upon retirement to convert those excess hours on the basis of 16 hours of sick leave to one month's premium in the State Employees' and Officials' Group Insurance program.
Wyoming Retirement System
Chairman Case explained the study of the benefits under the Wyoming Retirement System would be conducted by the Subcommittee with help from state agencies and would not be included as part of the study the selected consultant would perform.
Mr. Tom Mann, Director, Wyoming Retirement System, distributed Appendix 4, describing the various programs administered by The Retirement System. He stated he has completed a study required when the deferred compensation program was combined with the various retirement programs administered by the Retirement System. The study (Appendix 5) was conducted by Buck Consultants.
Chairman Case appointed a subcommittee consisting of Senator Schiffer, Chairman, and Senator Massie and Representative Harvey to review the Retirement System.
Interviews of Firms Submitting Proposals for Study
Chairman Case distributed to members of the Subcommittee a matrix (Appendix 6) he developed to assist members in scoring the proposals the Subcommittee would be considering during the interview process. After discussing the matrix scoring format, Chairman Case advised that the bidders would be interviewed in open session, but the bidders have been requested not to be present when another bidder is being interviewed by the Subcommittee.
Dr. Harold Gardner, M.D., presented a PowerPoint presentation explaining his proposal for the study. In response to questions from the Subcommittee, Dr. Gardner stated the database he is developing for the Governor should be ready by July 1, 2003 and that information should be available for the Subcommittee's study. He agreed that he would assist by providing necessary data from the database to whichever firm was selected by the Subcommittee.
Ernst & Young
Mr. Doug Knopp, with participation by other associates of the firm, presented information on Ernst & Young's proposal by telephone. He stated the firm has no preconceived notion of what would work for Wyoming with respect to the state employees' benefits package. The firm would bring a large computer system capacity to the study with heavy modeling expertise. He suggested a committee process may be necessary on a long-term basis to monitor the impacts of any changes to the benefits package that are made.
Buck Consultants
Ms. Liz Ramirez and Ms. Monica DeGraf were interviewed as representatives of Buck Consultants. Ms. Ramirez distributed Appendix 7, describing why Buck Consultants should be selected as the consultant for the study, and Appendix 8, an example of an actuarial analysis that could be used in the study. They explained that Buck Consultants is familiar with regulations of the Internal Revenue Service that allow for the roll-over of medical savings accounts and the firm has experience in developing health care plans. With experience with Great West Insurance Company, the firm should be able to readily obtain necessary employee participation data for the study in a Health Insurance Portability and Accountability Act compliant format. The firm's proximity to Wyoming would be an asset.
An education effort directed at state employees would be necessary to make any proposed changes successful. The firm would need a one day planning session early with the Subcommittee, if selected as the consultant, to plan the strategy for the study. The firm would study the pay-to-benefits ratio as part of the study.
Deloitte & Touche, L.L.P.
Mr. James Scearcy, with assistance from other associates of the firm, presented the proposal from Deloitte & Touche by telephone. He stated the firm amended its proposal to do a more comprehensive diagnostic up front to better understand the situation in Wyoming. The firm would need a project leader in Wyoming to answer questions the firm may have. That contact person would possibly be needed to consult between 40 to 80 hours total on the project, with bi-weekly meetings, some of which may also necessitate involvement of Subcommittee members.
Marsh USA Risk and Insurance Services
Because of traffic delays from Denver prevented Gallagher & Byerly from arriving at the scheduled time, Marsh USA Risk and Insurance Services (Marsh) representatives were interviewed next. Mr. Dave Knopp and Mr. Lawrence Wiscombe distributed Appendix 9, their firm's proposal for the study. They explained that they know Wyoming and its insurance situation from having worked with large coal mines in the state. In response to questions from the Subcommittee, they stated their goal was to provide the best study they could for the amount of money appropriated and that they would not be studying the Wyoming sick leave plan as part of that study.
Gallagher Byerly, Inc.
Mr. Don Heilman distributed Appendix 10, a summary of Gallagher Byerly's proposal and explained his prior experience and experience with Gallagher Byerly. Mr. Bill Robinson also explained his prior experience and experience with Gallagher Byerly. Both men work primarily with public sector employers. The team compiled for the proposed study in Wyoming is in the process of completing a similar study for Colorado.
Subcommittee Discussion
Chairman Case explained the discussion leading to a possible selection of a consultant would be conducted in an open meeting and called for comment from members of the public who were present at the meeting during the interviews. Because HCMS is already developing a significant database for the State that would be useful in the Subcommittee's study, Chairman Case suggested the Subcommittee should first consider the other firms, exclusive of HCMS. After deciding upon the selected firm from those remaining, the Subcommittee would then consider if that firm or HCMS should be selected as the firm to continue discussions with in an effort to enter into a contract for the study.
Ms. Alfrieda Gonzales, Governor's Office stated she could not comment on the bidders because she is already working closely with Dr. Gardner in the project he is developing for the Governor. Regardless of the Subcommittee's selection, the Governor was prepared to assist in the study as appropriate.
Mr. Richard Cox, Department of Administration and Information (DA&I), Human Resources Division expressed that all the bidders appeared to be well qualified to conduct the study. There are advantages and disadvantages to using Dr. Gardner to conduct the study.
The Subcommittee discussed the qualifications of the bidders and the scope of the services each proposed to provide in the study. After considerable discussion, the Subcommittee selected Buck Consultants as the bidder that presented the best proposal for completing the study. The Subcommittee then discussed whether it would be more beneficial to allow HCMS to conduct the study since Dr. Gardner has already begun preliminary compilation of the necessary data, or if whether it would be better if Buck Consultants should be selected because the firm would bring another perspective to the study.
After Subcommittee consideration of the better way to approach the study, Senator Schiffer moved, seconded by Representative Meuli, to negotiate a contract with Buck Consultants to conduct the study. The motion carried unanimously.
Mr. Rivera explained that the Legislative Service Officehas already drafted a contract that only needs insertion of specific information of the selected consulting firm. Once the contract is finalized, it would be sent to Subcommittee members and Buck Consultants for review prior to execution by the appropriate parties.
Chairman Case directed staff to inform the bidders that a selection of the consultant has been made, subject to successful negotiation of a contract.
There being no further business, Chairman Case adjourned the meeting at 7:50 p.m.
Respectfully submitted,
Senator Cale Case, Chairman