The document provides information about health care costs and insurance plans in the United States, Minnesota, and the Foley School District. It shows that on average, 87 cents of every health insurance dollar in the US goes toward medical costs, while 13 cents goes toward administrative costs and profits. Minnesota and Foley School District plans have lower administrative costs than national averages. The Resource Training & Solutions school pool offers advantages like lower costs and premium increases compared to other plans like SEGIP and PEIP.

1. Resource Training & Solutions Foley School District March 24, 2011

3. Where Does the Average American's Health Insurance Dollar Go? 3¢ *Includes prevention, disease management, care coordination, investments in health information technology and health support. Based on PricewaterhouseCoopers’ analysis, Factors Fueling Rising Health Costs 2008, © America’s Health Insurance Plans - - - - 13¢ - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 87¢ - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 3¢ 6¢ 5¢ Drugs 14¢ Outpatient 15¢ Inpatient Costs 20¢ Physician Services 33¢ 4¢ Other Medical Services Insurer Profits Consumer Services*, Provider Support and Marketing Government Payments, Compliance, Claims Processing & Other Administrative Costs

4. Where Does the Average Minnesotan’s Health Insurance Dollar Go? 3¢ - 10¢- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 90¢ - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 10¢ Drugs 14¢ Outpatient 17¢ Hospital/Inpatient 23¢ Physician/Professional 36¢ Administrative Costs Source: MN Department of Health, Health Economics Program., 2008, numbers adjusted and rounded to the nearest whole number

5. Where Does Your Resource Training & Solutions School Health Insurance Dollar Go? 3¢ - 5¢- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 95¢ - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 5¢ 2¢ Drugs 19¢ Outpatient 23¢ Hospital/Inpatient 18¢ Physician/Professional 33¢ Information taken from October 1, 2008 – October 1, 2009 Resource School Data, rounded to the nearest whole number Stop Loss Administrative Costs

6. Selected Highlights of Minnesota Healthcare Reform vs. Federal Healthcare Reform MN Health Care Reform (1990s – 2010) Guaranteed Issue policies, groups No pre-existing conditions with continuous coverage, groups Mandates for pre-natal care, cancer screening, immunizations, groups Gender neutral rates, groups Eligible Dependents to age 25, groups Minnesota Comprehensive Health Association (MCHA), High Risk Pool Federal Health Care Reform (2010 – 2014) Unlimited Lifetime Maximum, groups and individuals 100% Preventative Care, groups and individuals Eligible Dependents to age 26, groups Employer contributions included on employee W-2s Flex limited to $2,500 per year Guaranteed Issue policies, groups and individuals No pre-existing conditions, groups and individuals Health Care Exchanges Tax Incentives Medicare and Medicaid Changes

9. 2008 Average Administrative Charges

10. 2008 Average Administrative Charges PEIP, SEGIP and Resource Administrative Expenses – Fiscal Year 2008

11. Public Employees Insurance Program Development Information “ Line 2 of this report lists Unallocated Expenses, which include all PEIP’s direct expenses (e.g. administrative and carrier charges) and indirect expenses (e.g. underwriting expenses, salaries and benefits). In fiscal year 2008, PEIP’s administrative expenses were $1,505 million, while premium and investment income totaled $13,439 million. As a percentage of premium, PEIP administrative expenses were 11.2% in fiscal year 2008.” Letter from Tom Hanson to Bert McKasy, dated: November 17, 2009 2008 2010 1. Required Contribution and Investment Revenue Earned: $13,439,000 $25,031,000 2. Unallocated Expenses $1,505,000 $2,037,000 2008 2010 2. Unallocated Expenses $1,505,000 $2,037,000 1. Required Contribution and Investment Revenue Earned: $13,439,000 $25,031,000 Administrative Expenses as a percentage of premium: 11.2% 8.1%

12. 2010 Average Administrative Charges

13. Average Annual Firm and Worker Premium Contributions and Total Premiums for Covered Workers for Single and Family Coverage by Plan Type, 2010 * Estimate is statistically different from All Plans estimate by coverage type . Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 2010. HDHP/SO HMO PPO POS ALL PLANS $5,130 $14,125 $5,124 $14,033 $5,239 $13,213 $4,470* $12,384* $5,049 $13,770

21. SEGIP Average Premium Increases 2000 - 2011 (8.30%) Source: SEGIP 2005-2006 & 2007- 2008 Biennial Reports, Page 8 & 9, 2009-2010 Report Unpublished Feb. 2011

22. Resource Average Pool Premium Increases 2000 – 2011* (7.45%) Source: 2000-2009 Audited Financial Statements, Resource School Pool *2011 Estimated Increase at Cost Trend of 6.0%

25. PEIP Participating Groups and Employees, 2003 - 2010 Source: Minnesota Management & Budget, 2012-13 Biennial Budget Report, 10/12/2010 PEIP FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 # of groups 137 123 107 89 85 73 57 67 Change vs. previous year 0% (10%) (13%) (17%) (4%) (14%) (22%) 17% # of employees 3632 2950 2304 1671 1600 1400 1257 3258 Change vs. previous year (7%) (19%) (22%) (27%) (4%) (12%) (10%) 159%

28. Foley School District Age Distribution

29. Claims distribution page

30. Foley School District History Increase/Decrease

31. Average Annual Savings 3.95% *2010 Actual Estimated as Renewal Offer Year BCBS Trend Needed Renewal Offer Actual Increase/Decrease 2000 16.00% 15.90% 11.00% 4.90% 2001 14.80% 12.70% 8.40% 17.25% 2002 14.80% 15.40% 21.45% -4.51% 2003 14.80% 15.40% 13.30% 28.69% 2004 11.90% 6.40% 5.20% -5.59% 2005 10.50% 19.40% 15.40% 1.79% 2006 9.10% 0.60% -3.00% 8.08% 2007 9.10% 27.90% 24.40% 9.17% 2008 9.10% 4.20% 4.00% 18.16% 2009 7.50% 6.40% 5.40% 2.91% 2010 8.20% 18.80% 18.80% *18.80% Average 11.44% 13.01% 11.30% 9.06%