Florida Self-Insurers Guaranty Association Board of Directors Meeting Report: March 28, 2011
Apr 6, 2011
The Florida Self-Insurers Guaranty Association (“FSIGA”) Board of Directors (“Board”) met on March 28, 2011, via teleconference. To view the meeting materials, click here.
Following approval of the prior meeting’s minutes, the Board was updated on pertinent bills currently pending before the 2011 Florida Legislature, among which are several “repealer” bills relating to workers’ compensation.
Another bill, sponsored by Senator Alan Hays, contains drug repackaging bill provisions, but does not have a House companion.
It was also reported that unemployment compensation legislation has passed the House that would “update” a 1937 law that was described as “heavily tilted toward claimants.”
Review of 2010 Actuarial Report
Terry Godbold, Principal and Consulting Actuary of Pinnacle Actuarial Resources, provided an update on the actuarial review of FSIGA’s December 31, 2010 net loss and loss expense reserves conducted by his firm. Initially, the firm of Godbold, Malpere & Co. had been engaged to provide the review. As of January 1, 2011, however, that firm merged with Pinnacle Actuarial Resources without personnel disruption.
Mr. Godbold stated that two new insolvencies, those of Fleetwood Enterprises Inc. and Sun Coast Hospital Inc., were reported in 2010.
Highlights from the actuarial report include:
- FSIGA has a net liability of approximately $11.1 million.
- The estimate of gross ultimate loss for known insolvencies in effect as of December 31, 2010 has increased by approximately $7.7 million over last year, with about $5.5 million of that due to the insolvencies of Fleetwood Enterprises and Sun Coast Hospital, according to Mr. Godbold.
- Nineteen of the 27 active insolvencies have two or fewer open claims, with 14 insolvencies having only one open claim.
No Board action was required on the actuarial report.
Review of 2010 Audited Financial Statements
The Board voted to approve the 2010 audited financial statements, which were reviewed and approved by the FSIGA Audit Committee at its March 22, 2011 meeting.
Renewal of Office Lease
FSIGA’s five-year office lease with a three-year renewal option was set to expire on March 31, 2011, but was extended through July 31 to allow the Board time to consider options. A meeting participant stated that the lease renewal was recently renegotiated, resulting in rent savings for FSIGA. The Board approved the new office lease.
Renewal of GENEX Contract
The Board approved renewing FSIGA’s contract with GENEX Services, Inc., a medical case management firm, through May 1, 2012. The contract includes managed care services, such as case management and bill review.
Renewal of Cypress Care Contract
FSIGA’s contract renewal with Cypress Care, a claims management company, for pharmacy program services for prescription drugs in connection with workers’ compensation claims was also approved. The renewal extends the original March 16, 2007 contract through May 1, 2012.
The Board approved changes to the FSIGA’s retirement plan relating to benefits for military service members. According to a meeting participant, these changes are required under the Internal Revenue Service Amendment for Heroes Earnings Assistance and Relief Tax Act of 2008 and Worker, Retiree, and Employer Recovery Act of 2008.
California Matter with Fleetwood Enterprises
FSIGA is pursuing legal action tied to the Chapter 11 bankruptcy of Fleetwood Enterprises in California to obtain a reimbursement under an excess insurance policy issued by Old Republic.
Meeting with Florida Chief Financial Officer Jeff Atwater
Board Chairman Claude Revels and Brian Gee, FSIGA Executive Director, recently met with Florida Chief Financial Officer Jeff Atwater. Mr. Gee said that CFO Atwater is supportive of FSIGA and made complimentary remarks about the Board. Chairman Revels said that they discussed the two Board vacancies and five Board expirations upcoming in May 2011, and that they invited CFO Atwater to attend a future Board meeting.
Florida Division of Workers’ Compensation Update
A representative of the Florida Division of Workers’ Compensation (“DWC”) said that Pam Macon is the new Bureau Chief of the DWC’s Bureau of Monitoring and Audit. Ms. Macon replaces Robin Ippolito, who is now Bureau Chief of the DWC’s Bureau of Compliance, following the promotion of Tasha Carter from that role to Director of Consumer Services for the Florida Department of Financial Services. Ms. Macon previously held the position of bureau chief for the DWC’s Employee Assistance and Ombudsman Office and obtained underwriting experience prior to joining the Division.
The Board is next scheduled to meet sometime during the last week of June 2011. With no further business, the meeting was adjourned.
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