ALAMEDA ALLIANCE FOR HEALTH BOARD OF GOVERNORS REGULAR MEETING. May 13, :00 pm 2:00 pm 1240 South Loop Road, Alameda, CA SUMMARY OF PROCEEDINGS

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1 ALAMEDA ALLIANCE FOR HEALTH BOARD OF GOVERNORS REGULAR MEETING May 13, :00 pm 2:00 pm 1240 South Loop Road, Alameda, CA SUMMARY OF PROCEEDINGS Board Members Present: Jane Garcia (Chair), Marty Lynch (Vice-Chair), Dr. Bertram Lubin, Dr. Evan Seevak, Dr. Ray Davis, Jr., Dr. Rollington Ferguson, Scott Coffin, Wilma Chan, Nicholas Peraino Excused: Aarondeep Basrai, Delvecchio Finley Unexcused: Alex Briscoe, David Werlin Alliance Staff Present: Scott Coffin, Matt Levin, Matt Woodruff, Neal Jarecki, Debbie Rieger, Dr. Michael Griffis, Tiffany Cheang, Elia Gallardo, Craig Kellar, Aman Bhasin AGENDA 1. CALL TO ORDER J. Garcia The regular board meeting was called to order by J. Garcia at 12:06 pm. A board quorum was established by a simple majority for the meeting. 2. AGENDA APPROVAL OR MODIFICATIONS J. Garcia J. Garcia inquired if there were any modifications to the agenda. Without any changes, she requested a motion to approve the agenda. 3. INTRODUCTIONS Motion: B. Lubin Second: W. Chan Approved Unanimously J. Garcia Introductions were made for those present. 4. PUBLIC COMMENTS (NON-AGENDA S)

2 J. Garcia J. Garcia requested comments from the public in regards to non-agenized items. There were no comments. 5. CEO UPDATE S. Coffin S. Coffin provided the following updates: Fiscal YTD and operational indicators are trending favorably for March; Net loss $1.9M; fiscal year-end forecast net income $40M. Membership trend is plateauing and heading slightly downward. Received preliminary Medi-Cal rate notification from DHCS; less than 12% reduction for MCE population. HEDIS chase in progress; 90% collection of records completed DMHC financial audit completed. Strategic Planning Retreat was held on April 29 th ; reviewed goals of strategic pillars: quality, financial stewardship and operational excellence; breakout session discussions, feedback will be taken to the Strategic Committee to develop 3-year Strategic Plan. Managed Care regulations were released by CMS and currently under review. Operation readiness for undocumented children, Whole Person Care Pilot and self-funded Health Home Lite programs are underway. Pay-for-Performance program is currently in phase 2 focusing on primary care physicians (PCP); $14M budgeted for CONSENT CALENDAR J. Garcia J. Garcia pulled item b. Grant Policy Revision and Resolution from the Consent Calendar for discussion. a. Minutes of April 8, 2016 meeting were approved Discussion: Grant Policy Revision and Resolution M. Levin shared the changes that were made to the grant policy in Section 4.6: Any person on the grant committee may not submit an application; references in other areas of the policy were changed accordingly. W. Chan posed a question in regards to the conflicting eligibility requirements in Section 2.1 and 2.2 which apply only to the medical applications. W. Chan suggested that in Section 2.3, the Board should approve the Motion: R. Ferguson Second: M. Lynch Motion passed unanimously AAH BOG 5/13/ of 9

3 grant. J. Garcia suggested an edit to the last sentence in Section 2.3 Any amounts budgeted toward the grant program, but not spent in the prior fiscal year shall may be rolled over into the grant program for the succeeding fiscal year. J. Garcia shared concerns regarding the board s responsibilities regarding appeals and the ongoing commitment which could cause distraction to the main work of the Board. M. Lynch shared that the Alliance should be out of monitoring before distributing grant dollars; he agreed with J. Garcia about the grant program appeals process becoming a distraction; important to consider community giving; possibly consider another appeal process. B. Lubin suggested an option of a sub-committee to the Board which would make a recommendation to the Board, who ultimately makes the final decision. R. Ferguson questioned why an appeals process is needed; creates an additional unnecessary structure. B. Lubin responded that the appeal process allows opportunity for important additional information that was not initially submitted. J. Garcia suggested the changes of the grant program be sent to an Executive Committee made up of J. Garcia, M. Lynch and the chairs of the Strategic and Finance Committees. M. Levin to revise grant policy: Section 2.3: Change shall to may Add a section for Board approval of grant amount Section 5.1: Appeals to be designated to sub-committee 7. a. b. BOARD BUSINESS BOARD MEMBER RECOMMENDATIONS J. Garcia J. Garcia reported that interviews were held for candidates for the two (2) open Board positions for the hospital and labor seats. J. Garcia provided background information about the candidates and made recommendations to fill seats on the board as follows: a. Hospital seat: Dr. Michael Marchiano, physician at St. Rose Hospital. b. Labor Union seat: Travis Clay Stein, research analyst for the union. J. Garcia moved to recommend these candidates to the County Board of Supervisors to fill the hospital and labor union seats on the Board. Board Orientation training will be scheduled next month for all new members. 7. c. BOARD BUSINESS CREDENTIALING FOLLOW UP Motion: J. Garcia Second: R. Ferguson Motion passed unanimously AAH BOG 5/13/ of 9

4 M. Griffis M. Griffis provided a follow up on questions from the previous meeting regarding the credentialing evaluation process. He made the following recommendations: Reporting of credentialed providers through the Peer Review Credentialing Committee (PRCC) is reportable to the Board at the provider name level (in the open Board packet). Any physician is welcome to join the committee and be part of the peer review process. R. Ferguson inquired what percentage of the Alliance providers is currently certified. M. Griffis will provide that information at the next meeting and will consider adding a target goal for percentage of credentialed providers in the current policy. The Alliance delegates credentialing to CFMG, Kaiser, UCSF and Packard. 7. d. 1. BOARD BUSINESS STAFF PRESENTATION - OPERATIONS M. Woodruff M. Woodruff reported both Member Services and Claims are in compliance and have met all regulatory timeframes. He also provided an update on HealthSuite s current issues regarding its configuration and a contract which led to claim payments amounting to approximately $5M. These payments are targeted to be resolved by the first week in June. Another small issue was identified yesterday which may impact that total dollar amount. The claims denial rate in HealthSuite has dropped from 23% to 16%. The industry plan denial rate is typically 10%-12%. R. Ferguson shared concern about the increase in the unanticipated expenses for claims issues which has totaled approximately $33M over the past four (4) months. N. Jarecki responded that since medical expenses must be estimated, the Alliance financials are not based on the cash payments paid but rather on the medical estimates that generally absorb the claims costs. M. Woodruff continued to report the Member Satisfaction survey results which continue to be high at 98%. 329 surveys were conducted out of 18,300 calls. The Mystery Shopper calls began in April. 75% of the calls monitored were compliant with the approved script; 25% of the calls were off-script. M. Griffis to provide percentage of Alliance providers who are credentialed AAH BOG 5/13/ of 9

5 M. Woodruff shared the work regarding Pre-pay and Post-pay claims processes. The IT department has installed mechanisms to ensure all claims are loaded into the system. In addition, an audit process is in place to ensure every document that is sent to the claims scanning vendor is loaded into the system. A process to review high dollar claims has also been implemented. Approximately 8% of claims touched by processors are reviewed; consideration is being given to revamp the audit process as part of the compliance function. 7. d. 2. BOARD BUSINESS HUMAN RESOURCES C. Kellar C. Kellar reported the Alliance has 230 employees as of the end of April. Currently there are 27 job openings. C. Kellar shared a list of staff members who were recognized for their personal and professional achievements at the recent All Staff meeting. He also shared a list of those staff members reaching major milestones in their length of service at the Alliance. An employee opinion survey was conducted at the beginning of the year with almost 90% staff participation. Survey questions related to topics such as Leadership and Planning, Teamwork and Cooperation, Training and Working Conditions. The staff was very generous with their comments and feedback. Results of the survey will be shared with the staff next week. Approximately 106 (59%) staff members responded as overall satisfied, 31 responded as dissatisfied, and 43 staff responded as neutral. Overall the staff is very satisfied with their benefits. The lowest satisfaction scores were in the areas of Communication, Management/Leadership, Recognition and Rewards, and Training. Scores are being reviewed based on their correlation to overall satisfaction and overall dissatisfaction. The key strengths of the Alliance with the highest positive responses were identified as follows: My supervisor treats me with respect. My supervisor handled my personal issues satisfactorily. AAH BOG 5/13/ of 9

6 My supervisor treats me fairly. My physical working conditions are good. I enjoy the work I do. Most days I feel I have made progress at work. I feel I am contributing to the mission of the Alliance. Key opportunities for improvement were identified as follows: Having management team communicate clearly, then walk the talk. Demonstrating cooperation and teamwork; ensuring office politics are kept to a minimum. Favoritism of staff over others. Opportunities for development and promotion of staff. Designing and implementing initial and ongoing training of staff. Actions already initiated by the CEO and Human Relations department: Improved staffing levels to decrease workloads. Regular communications regarding job openings and internal transfers Mid-year evaluations and reiteration of expectations. Increased onsite management trainings, e.g. communication, coaching, counseling, interviewing. Involved staff in developing new Mission/Vision/Core Value statements. Established better staff communications including cross-department relationship building and social lunches. Increased frequency of staff recognition for personal and professional achievements. Additional actions by Human Resources: Detailed presentation of results and feedback at All Staff meeting on May 20 th. Continued efforts to fill open positions and reflect community diversity. Scheduling a salary survey to assess pay rates and make appropriate adjustments to be competitive and recruit and retain qualified staff. Launch Core Values Steering Team. Develop communication channels including an employee newsletter. Ongoing discussion of survey results and planned actions by senior management team. Continued management training classes including repeat classes for counseling and coaching of staff. AAH BOG 5/13/ of 9

7 Implementation of learning management system offering various training resources to staff. Ensuring consideration of survey results and comments and feedback as the 2016/2017 budget is developed and finalized for staff activities. Conducting employee survey in the future (January) to document any changes. J. Garcia inquired if the survey magnified any problematic areas, and if so, is there a team assigned to resolve those areas. C. Kellar responded that comments and feedback were received and reviewed for every comment from every individual in every area. All comments regarding specific individuals or issues are shared with senior leadership. S. Coffin added that the Sr. Management team is committed to focusing on the internal staff and departmental issues. E. Seevak inquired what the current turnover rate is over the past six (6) months. C. Kellar estimated it is approximately 10% - 12% which is typically low. The Alliance experiences a good retention rate. The Alliance is currently researching a vendor to provide online training courses which would include computer based trainings, books, and videos. It allows for training in specific areas of software programs and also offers courses for professional certification and continuing education. C. Kellar to add the employee turnover rate to the next Board report Department seminars will be implemented which allow for knowledge transfer for staff about the different departments and their functions at the Alliance. 7. d. 3. BOARD BUSINESS FINANCE N. Jarecki N. Jarecki reported for the month of March, the Alliance recorded a net loss of $1.9M. For the fiscal year-to-date ending on March 31 st, the Alliance recorded net income of $35M. This is the second non-consecutive loss within the current fiscal year. The net loss is caused by the Alliance needing to increase the medical reserve beyond what was originally predicted. Recently, the Alliance needed to reserve a significantly higher amount in an emergency category. Based on contractual requirements with a provider AAH BOG 5/13/ of 9

8 and the provider s recent change in their billing practices, the Alliance was required to pay out the provider claims at a significantly high rate. The Alliance is actively looking to renegotiate the contract with this provider. This added $4.8M to our medical expenses estimates. N. Jarecki provided the following financial statement updates: Enrollment for March increased to 268,000 members. Revenue is higher than expected due to more members and growth. Medical expense is higher due to higher enrollment, higher capitation expense and increase in IBNP estimates. Fiscal YTD PMPM medical expense is 3% favorable to budget. March Medical Loss Ratio (MLR) is 96%; YTD is 88%. Administrative Loss Ratio (ALR) is 6.7%. Medi-Cal program had a loss for the month due to SPD and Adult aid codes. Balance sheet cash is almost $400M, minus the Pass-Through Liabilities of $300M yields a net cash of $100M. Current Ratio is 1.24:1 (minimum is 1.0). Tangible Net Equity (TNE) is $119M or 590% (minimum is $20M). Capital investments for the month was $117,000; $2M for the year for disaster recovery system, phone system and facility upgrades J. Garcia requested a motion to approve the financial report. N. Jarecki reported that the Finance Committee had met on May 12 th and is in the process of developing a charter for the committee to indicate the general responsibilities of the committee. Motion: R. Ferguson Second: R. Davis Motion passed unanimously DHCS provided preliminary rates for the 2017 fiscal year. The preliminary rate decrease was 11.85% for the MCE population. DHCS also provided preliminary rates for the non-mce population of less than 6%. N. Jarecki shared information regarding the volatility in enrollment. July through December 2015 reflected an average monthly increase in membership of 3,400 members. Since then the enrollment has fluctuated monthly. Other plans are experiencing similar volatility. Approximately 50% is attributed to the MCE population. AAH BOG 5/13/ of 9

9 M. Lynch inquired if there are efforts being made to review the redeterminations and reach out to retain those members. M. Woodruff shared information about a current redetermination project working in conjunction with CHCN to identify those redeterminations and then having the Alliance call center contact the member to remind them to go to social services to sign up. The Community Relations and Outreach department is involved in setting up member orientations, participating in health fairs in the community. They are currently working on a marketing plan due to DHCS. M. Levin shared that unlike Medicare, marketing for Medi-Cal is prohibited. There are clear regulations regarding making referrals to facilities or community events, but not at provider offices or other locations. N. Jarecki reported that a draft of the fiscal 2017 budget will be presented to the Board next month and a final budget in July. 8. BOARD MEMBER REPORTS J. Garcia J. Garcia reminded the Board members that some still need to complete their 2015 and 2016 Compliance trainings. Reminders will be sent to the board members. E. Seevak announced that the first Strategy Committee meeting will be held on Wednesday, May 18 th. 9. PUBLIC COMMENTS J. Garcia J. Garcia requested comments from the public. There were no comments. 10. ADJOURNMENT TO CLOSED SESSION J. Garcia J. Garcia requested a motion to adjourn the public meeting and move into closed session at 1:36 pm. Respectfully Submitted By: Lynda Fong, Compliance Coordinator Motion: M. Lynch Second: R. Davis Motion passed unanimously AAH BOG 5/13/ of 9