Secretary of Administration (180)

Authority: Title 2.2, Chapter 2, Code of Virginia.

The Department of Human Resource Management (DHRM) shall conduct an actuarial audit of the State Health Insurance Program. DHRM shall select on a competitive basis and employ on a consulting basis an actuarial firm for the fulfillment of the duties set forth in this section. DHRM will be required to provide a report to the Governor and the Chairs of the House Appropriations and Senate Finance Committees by October 15, 2011. The audit shall provide a peer review of the self-funded plan benefits’ liabilities and contribution strategies. Specifically, the audit shall: (1) review the reasonableness of actuarial methods, and accuracy of reports produced by the actuary; (2) opine on the  appropriateness of funding strategies  and any related items; (3) assess the data and methods used to establish  rates; (4) evaluate the methods and assumptions used to estimate recent incurred but not reported (IBNR) liabilities, and other reserves/margins; (5) review and comment on actuarial models used to estimate the impact of plan changes, develop rates and budget projections, and monitor claims experience; (6) conduct a comparison of fully insured rates to those available in the marketplace; and (7) review any valuation results computed under GASB 43 and 45.