NGAUSIT Meeting

NGAUSIT Meeting

July 20, 2007

"The following is a re-cap of key discussion points and motions passed by the Board of Directors. Officially transcribed minutes are available for review by any member of the Association at One Massachusetts Ave, Washington DC."

Members Present:

MG Martin Umbarger

BG Robert Taylor (Ret)

Maj Gen David Poythress

Brig Gen Kenneth Ross (Ret)

COL Al Faber

Colonel Peter Renaghan (Ret)

COL Don Deering

COL Malen Dowse (Ret)

Mr. Richard Northup

MSgt (Ret) Mike Cline
COL (Ret) Tom Kirkpatrick

Members Absent:

BG Norman Arflack

1LT Brad Hollingsworth

MG Frank Vavala

CSM Frank Lever

Others Present:

CMSgt Hagan (EANGUS Vice President)

Brig Gen Stephen Koper (Ret)

Ms. Pam Buckler

Mr. John Buckler

Mr. Lewis King

Ms. Loretta Fills

Brig Gen Robert Dutko (Ret)

Brig Gen Bill Spruance (Ret)

Mr. Ron Sutton

Ms. Wanda Seay

Mr. Ray Lindner

MG (Ret) Ron Harrison

Ms. Leslie Pine

MG Luke Goodwin (Ret)

Col Ray Magill (Ret)

The meeting of the NGAUSIT was called to order by Gen Umbarger at 1400. He welcomed the members. The roll was called by the secretary, COL Faber, and he reported a quorum was present.

Vice President Hagan wanted the record to reflect that he was in attendance for EANGUS President Frank Lever.

Gen Umbarger said last year had been a challenging year financially for the Insurance Trust rebate program as Ron Sutton had predicted that things were not going so well, but the report looked much better by the years end.

Old Business:

Ron Sutton: ING Report

Ron reported that he would give the ING update as John Breyer and Dave Monson do not attend the meeting in July.

Ron reported that plan year 2006 ending total was $1,673,516. He said the estimate for January 1, 2007 through June 30, 2007 is $656,565. He said the comparative difference between last year and this year 6 month period is about $377,000. He said we are well ahead of last year and if there are no significant claims, the year end total could possibly be two million dollars.

Ron reported that the marketing activities included the upcoming EANGUS Conference on August 10th in Oklahoma City, as well as the NGAUS Conference in Puerto Rico in August 25th-28th. He said he has attended state conferences with ING support. He said the Open Enrollment in Massachusetts was the best organized he has ever seen, which Wanda attended. He said there were eleven enrollees from that effort.

Ron reported they would be doing an Open Enrollment in Kentucky and South Carolina.

He said Dave Monson and Wanda will attend the training session in Little Rock. He said this training session is conducted for the HRO’s. Ron said the demobilization enrollment for soldiers and airmen is an ongoing process.

Ron reported ING continues to update the website. He said that all forms are kept current and are there for the convenience of whoever needs them, as well as all explanations about the programs. ING is also involved in the magazine advertisement for the technician disability program.

Ron reported that he thought this year will be an exceptional year.

COL Dowse asked if the forms could be filled out on line, Ron said they could not. Ron said he would talk to ING to have them look into having an interactive form online.

Gen Umbarger asked Ron if there is a report that shows percentages of enrollment by state. Ron said there is such a report that list each state and how many people are enrolled from that state.

Mr. Northup asked if Ron could add to that report the available subscribers like the total number to see the penetration. Ron said they were able to get a report from the Bureau that list the number of technicians there are, but the report he has is about two years old. Ron said they try to target the large states that have low enrollments.

Gen Umbarger said the $2M revenue prediction was good news. He asked Col Renaghan the budgeted amount. Gen Ross said it was (80%) of the rolling average. Pam said that it is $777,000 from the plan experience fund. Col Renaghan said it was (75%) of the ten year rolling average.

Gen Umbarger entertained a motion for approval of the minutes. COL Deering made a motion to approve the March 07 meeting minutes as presented. Gen Taylor seconded. Motion carried.

Gen Ross asked if we had found a way to harvest some of the money from the New York Life Program. That would be reported in the financial report by Pam.

Budget Report—Pam Buckler

Pam reported there were not a lot changes in the budget. She reported the 2007 revenue is $1,569,800 which is an increase of $22,500 over the original proposed budget.

Pam reported expenses are $479,100 with a decrease of $22,300. She said royalties from the disability program increased $30,000 to bring it in line to where we were last year. The New York Tech royalties were decreased by $3000.

COL Faber asked for clarification as some members were not following her in the booklet.

Pam reported there was no change to the vision care. There were minor adjustments to the investment revenues strategy. Pam reported that salaries were decreased $8,800 due to the vacancy position of the full time director was not hired yet. Communications expenses were decreased by $500 to be in line with year end predictions. There was no change to the FF&E budget and business insurance. Financial and legal expense decreased by $2000. The biggest change in the budget was the decrease in the HRO Conference support by $10,000 due to their conferences happens every other year. There was no change to the Trustee or the Advisory Committee expenses. The AD&D premium was reduced to be in line where we finished last year. She said the payout would be dependent on the strengths of the NGAUS and EANGUS membership which fluctuates from year to year.

Gen Ross moved to adopt the changes recommended by the Finance Committee to Mid-Year Review. Col Renaghan seconded. Motion carried.

MSgt Cline said that the EANGUS membership has grown about 30,000 since February. Pam offered congratulations.

New York Tech program Update: Pam Buckler

Pam reported that Dave Monson would give a more complete report in November on the New York Tech program. She said that would be when they could budget against any revenue received by the Trust. She said ING is in the process of pulling all applications for all the members in the New York Tech Program to see if they assigned the money to ING or if they signed up with the new form that assigned it to NGAUS. She said they are finding that about 40% of the insured base have assigned it to NGAUS and have not assigned it to themselves. She said that was the average of refunds over the last nine years is about 36,000, the experience rating refund for the New York Tech. She said if the 40% holds we could have about $14,000 added to the operations budget next year. She said the 40% interest would be about $8,000 we could use. She said that collectively the average would be about $22,000 added to next year’s operation budget. She said that could not make the money retroactive because they would have to pay all those who assigned it to themselves.

Gen Ross said due to the payout portion of the report he was not comfortable with that. He said if some technicians received the payout and some did not that would cause some animosity and he did not want to answer that question. He said maybe we should go back to Plan A, which was to give more and more insurance to use that money to attract new sign-ups until we don’t have any assigned to themselves. He said he had not heard of the payout process before and could see that creating a real problem. He said we do not need that PR.

Pam said we could wait for the ING final report. Gen Ross said to make sure we do not give ING any indication that NGAUS wants to draw the money out if that is the rule. Pam said that will not happen until the following March and she will definitely get it in time for the Finance Committee to look at it to make a recommendation for the November meeting.

Gen Ross said he will withdraw his push for getting the money if that is the strategy as he had not heard of that before.

Gen Umbarger asked if there is a way to start to look at the mitigation if that is in fact the way it has to be and what action could be taken that would make it fair to every one.

Gen Ross said that what has originally been done is that they had given free insurance up to 50% and increase it even more than that if need be. He said he is more in favor of that than to create conflict that NGAUS is taking some peoples money.

Pam said that since it is a New York policy, that some other states might get the impression that there is a benefit of free insurance to New York and not to the other states.

Gen Ross said we need to be very careful about taking money that creates an envy war. He said there may be other ways and they would see if there are.

Legal Update—COL Tom Kirkpatrick:

COL Kirkpatrick reported there are no outstanding legal matters and all the cases that were against us had been settled or in the process of being settled. He said there are no new cases on the horizon.

Gen Umbarger asked if COL Kirkpatrick would be able to look at the legal options of the New York Tech payout. He said he would do that. Gen Umbarger assigned him that tasker and asked him to report in November.

TRICARE Supplement Update—Ron Sutton

Ron reported that USBA is slated to kick off the TRICARE Supplemental insurance on October 1. He said that prior to the kick off, they want to get out some advertisement. He said that Bob and Connie from USBA would have a booth at the conference. Ron said the USBA people would send him a flyer for approval before it is printed. He said Gen Koper has requested that he give a word of caution to Mr. Jesco that the way the bill is written and what congress does with it no one is sure how the final language of the bill will end up. He said Gen Koper does not want to advertise something that is not accurate for our members. Ron said EANGUS will also advertise the TRICARE Supplemental program kick off.

Gen Koper said his concern is the TRICARE management agency has been tasked by DoD to supply implementation instruction and market introduction. He said that he wants to make sure that what we think its going to say is what it says in fact. He said that he does not want to advertise information and have to retract it.

Ron said no press release would be done without NGAUS approval.

Gen Koper commented that he thinks we have a golden opportunity with this program in the Guard to help market TRICARE for the Guard and Reserve. He said that DoD will do minimal amount of promotion on introduction and will not do anything after that to try to save money.

COL Kirkpatrick said he and Ron had asked them to do a comparison between what this supplement offers as related to MOAA and some of the other service organization that deal with this issue. He said a comparison chart would be helpful. He said it has to measure up to what some of the sister organizations are offering to those who are eligible.

COL Faber said that the Army Times magazine publishes a complete comprehensive look at all of the TRICARE Supplemental programs. He said the matrix includes information on preexisting conditions, co-pays and leads you to what are the best programs.

Mr. Northup said he has a copy and would send it to the members who wanted it.

Ron reported that he was tasked to look at the ING Accidental Death and Dismemberment program since it began with ING in January. He said there have been no claims to date. He said that last year under Fidelity there were six claims.

Ron said they have been looking at if they want to self insure. He said he has talked to people about reinsuring which will cover the first $30,000, which is the current premium cost.

Col Renaghan asked if Ron is still looking into the re-insurance. Ron said he had just inquired as to how it works. He said he had talked to Dave Monson and Gen Goodwin. Ron said ING does not write that type of insurance, but Dave Monson would give him the names of some companies who do.

COL Faber asked if that tasker is still open. Gen Ross said yes it would still be open and that he thinks the goal is to move toward something that does not cost $30,000 per year. He said that 10 to 15% of the premium is a total payout per the history. He said what we want to find is something different.

Gen Koper said the tasker should be rewritten to read continue to research the cost of reinsurance.

Ron said they would discuss it in the Insurance Advisory Committee meeting in September.

COL Deering asked if it had been settled as to whether the reinsurance program would infringe upon the tax-exempt status.

Gen Ross read the reference to the tasker as stated in the March minutes.

Gen Goodwin said that the most economical way right now is to be self-insured, but what are the aspects of self-insurance. He said legal issues have to be considered because you have to be licensed to do so. He said that re-insurance will be difficult because there are so few companies that write reinsurance. He said those companies look at the overall risk of the number of people that possibly could fall into that category to be entitled to the $1000 death benefit. He asked if the Insurance Advisory Committee were being asked to look at self-insured issue again, that is the question. He said re-insurance will not be much cheaper.

Col Renaghan said if we self insure would it be called insurance or could we say we would make it donations to any member who has an accidental death.