TO:               Executive Vice Presidents, Chancellors, Vice Presidents, Vice Chancellors, Vice Provosts, Deans, Directors and Heads of Schools, Divisions, Departments and Offices

FROM:          William E. Sullivan, treasurer and chief financial officer, and Trent Klingerman, interim vice president for human resources

DATE:           January 23, 2015

SUBJECT:     Medical plan reserves

 

Based on a recent review of Purdue’s medical program, including current and projected claim trend data, it has been determined that the target levels for the University’s medical reserve should be reduced.

The decision was made by the Office of the Treasurer and Chief Financial Officer at the recommendation of the Office of the Vice President for Human Resources.

In order to prevent the medical reserve from rising above targeted levels, the 2015 calendar year medical assessment to university accounts will be reduced. From January 1, 2015, through April 30, 2015, no medical charges will be posted to university unit accounts. This applies to all sponsors and all accounts based on both biweekly and monthly payroll for benefits-eligible staff. Normal charges will resume May 1, 2015 and future rates will be adjusted when they are set for calendar year 2016 and beyond.

The Office of Financial Planning and Analysis, in conjunction with stakeholders, will develop a methodology to calculate and recapture savings to the general fund, medical budgets held by the units. Savings to other funding sources may be used for other purposes, if allowable and dependent on sponsor guidelines. If not allowable, funds will be returned to the sponsor.

Any questions regarding funds should be directed to the unit’s business office.