 It is 8 o'clock. So we're going to get started. My name is Kevin Mullen chair of the board. I'm going to call this meeting to order. The first item on the agenda in our health care advocate is already taken advantage of it. We're going to invoke GMC be rule number 1 trillion in 90 H and not require any jackets for this hearing. So we'll get rid of that. The second item of business is making sure that everyone who's tuned in knows that there's a public hearing tomorrow from 4 to 6. And we look forward to hearing people's thoughts on not only MVP submission, but also on the Blue Cross hearing from Monday. So with that, I'm going to appoint Michael Barber as the hearing officer and turn the meeting over to him. Mike. Thank you, Mr. Chair. For the record, my name is Michael Barber general council for the board. As you heard, I've been designated to serve as the hearing hearing officer for today's hearing. The purpose of this hearing is to take evidence and argument on MVP health plans, 2023 individual and small group rate filings. The docket numbers for these cases are GMCB-005-22RR and GMCB-006-22RR. The hearing is being held pursuant to 8VSA 4062. Representing MVP today are Gary Carnady, Ryan Long and Alice McDermott from the law firm of Primer Piper Eggleston and Cramer PC. Do you have anyone else with you, Gary, or did I get everybody? That's everyone. Thank you. Representing the Office of the Health Care Advocate today are Jay Angoff from the law firm Marion Scallat, PLLC, as well as HCA attorneys Eric Schulteis and Charles Becker. The board's attorney, Laura Bellovo, is also with us and we'll be questioning witnesses today. Because we're holding the hearing remotely and I apparently did have a couple of technical issues. On Monday, I did just want to take a minute to make sure that folks can hear me and that we can hear everyone else. So just bear with me for a minute. But I'm going to call on the board members, the attorneys and the court reporter just to make sure that we're not having any issues. So, Mr. Chair, can you hear me? The good news is that I can hear you loud and clear unlike Monday when you were very quiet. Today you're coming through very, very succinctly. Thank you. Sure. I figured out I had a big exhibit binder in front of my microphone. So, board member Holmes. Yes, I can hear you. Can you hear me? Yes. Thanks. Board member Lunge. Hi, Mike. Board member Pellin. I got you stirred up on Monday so I can hear you loud and clear today. Yeah. Yes, I can hear you. Great. Board member Walsh. Good morning. All clear. Great. Ms. Bellovo. Good morning. Good morning. Mr. Carnegie. Yes, good morning. I can hear you fine. Thank you. Mr. Anengoff. Yeah, Mike, I can hear you fine. I hope everyone can hear me and that there's no annoying echo. I don't hear an echo and Mr. Miller. Much better today. Great. OK, so with that out of the way, we are recording today's hearing via Teams. We also, as you know, have a court reporter here to transcribe the proceedings. We will provide the parties with a copy of the transcript as soon as we receive it. I expect that to be early next week for members of the public who are present. We will be taking public comment at the close of today's proceedings. I don't know when that will be. So if you don't want to sit through a long day of witness testimony, as the chair mentioned at the beginning, we are holding a hearing, a meeting this Thursday from four o'clock to six o'clock in the afternoon, specifically to take comments from members of the public on the hearings, on the rate filings from both carriers. So again, four o'clock to six o'clock on Thursday. Information about how to attend that meeting can be found by going to the Green Mountain Care Boards website and getting some feedback from an eight, four, five, four, nine, four number. OK. So if you go to our website, the Rate Review tab has information about how to attend that meeting and just a reminder to the board and the parties before we begin to exercise caution regarding information in the binders that's been marked as confidential as those matters can't be discussed in a public setting. And if it becomes necessary to discuss confidential materials, we do have a separate phone line if we need to go and do executive session to do that. So let me just spend a minute on the binders. We received exhibit binders on July 14th with 34 exhibits, exhibits one through 33 and exhibit A. As I understand it, exhibits one through 33 were stipulated to by the parties. Exhibit A was not stipulated to on July 19th. We received nine additional exhibits, exhibits 34 through 42. I understand those have also been stipulated to. And then also on July 19th, we discovered that exhibits four and five were incomplete and needed to be supplemented. And there was two additional exhibits added 43 and 44, which were responses to Objection Letter 6 in both filings. And I understand that has all been stipulated to as well. So to recap for folks, you should have a binder with 44 exhibits, I believe. Exhibits one through 33 were in the original binders and exhibit A, and then the rest came via email. Does anyone not have all that material or have any questions about that? Okay. Okay. So then I assume neither party objects to me admitting exhibits one through 44 into evidence at this time. Mr. Carnegie, any objection? No objection. Mr. Angoff, any objection? You are on you. Sorry, no objection. OK, thank you. And consider that done. And then I understand there are objections to exhibit A. And I should probably address those now. Does that work, Gary? That's fine. Thank you. Well, first, I'd like to say that, yes, we have a dispute on one exhibit. I'm going to argue why that exhibit shouldn't be admitted. But we agreed on 44 exhibits. So I think that the health care advocate and MVP over the years, we've been able to really focus on solutions on all these exhibits. And we apologize for all the exhibits in advance to the board, but I think it'll be helpful as we go through the testimony. So let's talk about our respectful disagreement. The exhibit A is in your binder and there's an A on it. If you would just turn to the first page of it, I have a copy here. Exhibit A is the 2021 Vermont Household Survey from the Department of Health. It's a hundred and sixty four page report. And if you look at that first page, it's prepared by Market Decisions Research, which is out of Portland, Maine. And the authors of the report, as you can see on that first page are Dr. Brian Robertson, Mark Noyes and Anna Driscoll. So we object to this exhibit going into evidence on three grounds. First, this is an expert report prepared by an expert consultant who the HCA did not disclose pursuant to our scheduling order. We have a specific requirement in the scheduling order to disclose experts by May 31st. Dr. Robertson was not disclosed, and therefore this expert report should not be allowed into evidence. Second, the opinions and statements in the report should not be without the witness being live here so I can cross examine them. Accepting the report into evidence amounts to accepting testimony outside of the hearing. The Mountain Care Board Rule 2307E1 provides the chair shall administer an oath or affirmation to any witness before the witness testifies. Rule 2307E2 provides the chair shall permit a party to conduct a reasonable cross examination of any witness upon request. Rule 2307E2 provides that any testimony is not provided under an oath shall not be considered for the truth of the matter asserted. That means hearsay is not allowed. Similarly, as a general rule, expert written reports are hearsay and inadmissible in evidence in Vermont courts. The opinions need to be presented via sworn testimony in the expert be present. Rule 702 of the rules of evidence only authorizes the introduction of an expert opinion in the form of quote testimony. The Vermont Supreme Court has ruled in numerous cases that non testifying experts opinions amount to hearsay and are inadmissible. I would make a proffer if you go to the first page of Dr. Robertson's website, the market decisions research website. It states Dr. Robertson provides technical leadership for all market decisions research projects, including research design, survey structure, sampling mythologies, data collection methods and analysis. He ensures that data collected is truly representative of a population of interest. Advanced tools are used to get the most from the data and the data presented is clear and actionable. So Dr. Robertson is not here today to present his testimony. I'd like to ask him questions about his methodology, about his conclusions and cross examine further. Follow your own president. The board is consistently required to carriers and the HCA to bring their witnesses to testify. The expert actuaries in previous years. The HCA has had this is before Jay's time, but they had an expert actually come and testify. They were required to testify so I could cross examine. Similarly, Mr. Pontiff, my witness today, he's an expert. He's going to be testifying for probably three hours or more on the rate filings on which is an expert report. Answering the HCA's cross examination questions and questions from the board by his opinions. Similarly, Ms. Lee is submitted to actuarial memorandum, but she's here so she can be cross again by me and the HCA about the opinions contained in that document. So as I said before, Dr. Robertson is not available here for me to ask some questions and it doesn't really allow for a level of thank you any kind of bad experts. The third point would be that if this report is admitted, I think it creates a prejudice for MVP and is confusing. Report is based on surveys of people in Vermont. It's not based on actual historical data from MVPs membership. It talks about health care utilization, monthly premiums and deductibles. They're all discussed in the survey. The actual experts, Mr. Pontiff, Ms. Lee, aren't relying on surveys. They're relying on actual MVP data. So Dr. Robertson's opinions, I think, can be confusing on issues that are material for this. Now, I anticipate that opposing counsel will point out that there was a report last year that was allowed into evidence and I would submit that last year. That report was not prepared by an outside expert consultant, but more objective information here. Finally, I didn't object to it because for that reason it was different documents because there was this outside expert. So we would move that the exhibit not be allowed into evidence. Thank you. So I just want to first correct one factual error for my entire time in Vermont. So this report and the last report, market research has been the contractor hired by DOH to summarize the results of the Vermont Household Health Information Survey. Contrary to Mr. Cornady's assertions, I would respectfully submit that this is not an expert in this case, rather this is a report produced by the Vermont Department of Health. The veracity of it cannot be reasonably questioned and it is clearly relevant in the present case as it speaks directly to the statutory criteria of affordability and access. Lastly, I will note that in every past rate review that I've been part of, the board has admitted said document with no objection from the board. I ask that the board take administrative notice of this document as it is empowered to do. Thank you. I have a question for the HCA. Do you plan on asking witnesses questions about this document at the hearing or is this more for briefing? I'm just wondering what. Sorry, go ahead. Mr. Terry officer, I don't plan on asking questions about this document. May I respond? Go ahead. Just to be clear, I have last year's exhibit and there's no reference on the exhibit to market decisions research. And I don't think the point is whether they ask a question. The point is you're putting in expert opinions that they can then rely on in their briefing and the board can consider it. So I just go back to my earlier points. Sure. And the reason I asked the question is because I would like to give it a little thought before I make a decision. And I'm wondering whether I need to make the decision at this point or whether I can defer that decision to either the conclusion of the hearing or after that, probably the conclusion of the hearing. So that that was the purpose of the question. I have no objection to you deferring it. That's fine. No, I don't know. All right. I didn't hear that, Jay. Yes. The HCA does not have any objection to this question being deferred. Okay. Any further argument? I think I will take this up at the close of the hearing. Any further argument from the parties on admissibility? No, other than if you wanted to defer until you saw the record of some things, I think that's fine, but it's actually up to you. I would just like to make one last point that Attorney Carnady referenced that this does not incorporate experienced data for MVP. It does speak to our community directly and to Vermont, and it is the best data source we have produced by the government about the people of Vermont, which MVP serves? Yes. Do you have a response to MVP's assertion that this is expert testimony? I mean, sorry, expert report. So again, I would argue that that's a mischaracterization. It's a government report. It's always been produced by the same or last year is produced. Last time it was produced by the same contractor. It's released by DOH. It's a government report and that Attorney Carnady is mischaracterizing it as an expert report prepared for this hearing, which it is not. I didn't say it was prepared for the hearing. It's certainly a PhD. Dr. Brian Robertson is the author of the report. The balance is up to the hearing officer and how you want to decide that this is clearly opinions of an expert. I presume that the state of Vermont isn't going to hire somebody who doesn't know what they're talking about. This is an expert survey. All right. Well, we will take this up at the close of the hearing and I appreciate the arguments of the parties on that. So if there's nothing else on this at this time, then I think we can move to opening statements. Gary, you can go first if you'd like to take a minute or thank you. Thank you very much. I'm ready to roll here. Good morning. I guess you already know my name is Gary Carnady and I'm here again representing MVP along with Ryan Long and Alice McDermott in the 2023 rate filings for individual and small group. The evidence will show that MVP is seeking a 24.5 percent average rate increase for individuals and 23.4 percent increase for small group. I think this year there are three primary issues for the board to consider in setting MVP's rates. First is medical trend and increases proposed by the hospitals in recent budget submissions. Those submissions will have a significant impact to MVP's rate filings this year. This past week the last of the hospital's budgets were submitted by the hospitals for the board. The weighted average increase is 10.66 percent and a 16.3 percent commercial approved effective rate. Those hospital budgets upended MVP's original rate filing and the evidence will show that the proposed hospital budgets if approved have a significant impact on these rates initially proposed by MVP adding another just over 7 percent to the requested increase for individual and small group. As you know the board's charge is to ensure that the monitors have the insurance necessary to pay for such hospital budget increases. Again in this year's MVP rate filing excuse me rate filing hearing the board has to anticipate what it will decide at the hospital budget hearings. As you know those hearings take place after the record is closed in this case. You will hear evidence that will guide the board to exercise its discretion in our case consistently and reasonably based on evidence. The board of course needs to make sure the decision is based on evidence and not speculative. In short medical unit cost trend should be recognized and included in the final approved rate increase of MVP. We believe the second primary issue for this year is contributions to reserves. The evidence will show that the board should be steadfast and adopting MVP's proposed CTR 1.5 percent without modification. The evidence will show that this is not a year to cut MVP CTR below 1.5 percent. The evidence will show that MVP had significant losses last year. I quote LNE in his actuarial memorandum. LNE notes that it is not sustainable to have long term negative profits and therefore a higher CTR may be justified. This concern raised by LNE and its actuarial memorandum is well founded. If significant losses continue into 2023 and beyond board cuts to CTR are simply not sustainable. Third we have just two disagreements with LNE this year on MVP's proposed rate increase. One is on the COVID-19 vaccine adjustment. LNE would reduce MVP figure by point six for individual and point seven for small group. And the second disagreement with LNE this year is on an adjustment for large claims where they would it reduce MVP's requested increase by point seven for individual and point nine for small group. We respectfully disagree with LNE on these two issues and you will hear evidence on those issues as well. Thank you for your time. Thank you Mr. Carnegie. Mr. Angar would you like to make an opening statement. Yes I would. Thank you Mr. Hering officer. Good morning Mr. Chair and members of the board. I have a soft spot for him. And the reason I have a soft spot for MVP is there's no sanctimoniousness on the part of MVP. There's no whining. They just come in and they ask you for a big rate increase. Now I think that big rate increase is unjustified. I think the evidence will show it's unjustified but I appreciate their style. I don't appreciate that in certain cases the boards ask them questions and they've essentially gone gone. They've essentially told the board to pound sand and I'll point those out too and I hope that MVP at this hearing will answer those questions. I'd like to make four points that I think are important about the testimony you're going to hear. Number one you're going to hear a lot of testimony about all the things that MVP has tried to do to make rates affordable and that's great. That's admirable but that's not the standard in the statute. The statute says the board must consider whether the rate is affordable not whether MVP has tried to make rates affordable. It looks only at the person the polish holder can that person afford the premium. It's the exact opposite of the excessive inadequate and unfairly discriminatory standard. A lot of people a lot of consumers don't get that that has nothing to do with whether the consumer can afford it. That has only to do with whether the premium taken in is the right amount to cover the amount that the insurance company will pay out. So a lot of the testimony that you're going to hear about affordability is irrelevant because it doesn't go to whether whether the individual policy holder can afford to be appositing. Second point in many cases with the two exceptions that Mr. Carnady pointed out where and where L and he says MVP's assumptions are unreasonable and the L and he doesn't say that MVP has picked the best the best number for any element. It simply says that MVP's assumption is reasonable. There are many many assumptions that are reasonable and it's the board's the board's authority to within this zone of reasonableness pick a number which maximizes among other things affordability. The fact that MVP and L and E agree that a number one number is reasonable doesn't mean at all that there aren't several numbers that are not also reasonable. Third point MVP is not a Vermont company. They're a New York company. That doesn't make them a bad company. But Vermont is a tiny teensy weensy tale of a much bigger company. Vermont business accounts depending on which how you measure it from between five percent and seven and a half percent of MVP's total business. So last year in connection with last year's rate filing the most recent year you all were considering in connection with last year's rate filing MVP had a terrible terrible year in New York but a good year in Vermont and all respect. I think that at least part of the rate increase that MVP asked for and was granted for Vermonters really went to cover some of their losses in New York. So I think it's very important this year what happened last year is over the dam or over the bridge or whatever the cliche is but I think it's very important this year to make sure that Vermonters are not subsidizing MVP's bad results in New York. And a fourth point and this is related to the point I just made. MVP's RBC ratio is very low. I don't think dangerously low but it's under 400 and I forget what from Blue Cross proceeding as public and non-public so I'm not going to mention any numbers but you know that's far, far lower than Blue Cross is Blue Cross's of RBC and what what you all do in connection with this little rate increase for a very small amount of MVP's total premium not going to have an effect on one way or the other on MVP's surplus and therefore an MVP's RBC ratio but it's just something for the board to be I think to be cognizant of that MVP's RBC ratio is low and it's falling more than 50 points from last year. So those are my four substantive points but I'd like to leave you with this. MVP is now saying essentially we know you all are going allow the hospitals to charge us more and therefore we want you to allow us to charge consumers more and my response to that is they need some tough love or and I know all of you with one possible exception are much too young to remember this great zombies song from 1966 which goes tell her no, no, no, no, no, no, no, no, no. I think there's gotta be some of that in order to benefit in order to this sounds too packed but in order to tell consumers yes, you have to be able to tell the hospitals and the insurers know at least to a certain extent. So I hope you'll consider that and the spirit in which it was meant and I look forward to the hearing. Thank you very much. Thank you Mr. Engulf. Mr. Karan are you prepared to call your first witness? I am if you could just give me one moment we'll call Chris Pontiff Mr. Pontiff I'm gonna swear you in at this point. Would you please raise your right hand? Do you solemnly swear that the evidence you shall give relative to the cause under consideration shall be the whole truth and nothing but the truth so help you God? I do. Good morning Chris. Good morning Gary. Did you know that song that Jay just referenced? I did not. Fair enough. Nor did I Jay, I'm sorry. Chris would you state your full name for the board please? Yes, Christopher Pontiff. And where do you work? I work at MVP Healthcare. And MVP Healthcare is your employer? That's correct. So the filing this year was filed by MVP Health Plan Inc. The two filings I should say. What is MVP Health Plan Inc. please? That is the HMO subsidiary of MVP Healthcare. Okay and what is your position at MVP please? Director, commercial market actuary. And are you a member of any professional associations please? I am. I'm an associate of the Society of Actuaries as well as a member of the American Academy of Actuaries. And how long have you worked in the health insurance industry? About five years. Okay and that's been with MVP? It has. And over those last five years could you tell the board your involvement and the number of times that you've made filings in Vermont? Sure. So every each of the five years that I've worked at MVP I have in some capacity prepared or oversaw the development of the small and individual rates as well as the large group rates. So this year will make about 10 filings in total that I've worked on for the state of Vermont. And you're taking over from Matt Lombardo as the witness in the hot seat today correct? That is correct. What are your job duties at MVP? I oversee all commercial pricing from MVP as well as corporate reserving and corporate forecasting for our commercial lines of business. And would that include setting IBNR? It would. And reviewing cost drivers? That's correct. What I want to do which I do each year is acclimate you and the board to all these exhibits in the exhibit binder. Do you have that binder handy? I do. And there's an exhibit list that we sent last night, the final exhibit list, which is three pages. Do you have that? I do. And then there's attached to it the non stipulated exhibit list. We don't need to refer to that. So I just want to go through and get a sense of where things are and what we'll be talking about. So if you look at that list, exhibits one through seven, nine through 11, 17 and 20, the exhibits that are our individual and small group rate filings, responses to objections, and you've reviewed them and are familiar with them and would adopt them as part of your testimony, correct? That's correct. Then exhibit eight. That's your CV, correct? Correct. And you prepared that? Correct. And then exhibit 16 going to the second page. That's your pre filed testimony. And you reviewed that and are familiar with it, correct? Correct. And adopt that as your testimony here? I do. And then going back to exhibit 12 and 13, those are the L and E actuarial memorandums of July the 5th. You've reviewed those and are familiar with them, correct? That's correct. And we'll be referring a lot to exhibit 12 in the hearing exhibits 14 and 15. Those are the two DFR letters on solvency, correct? That's correct. Okay, and you reviewed those and are familiar with them? That's correct. And then exhibit 18 is MVP's calculation of L and E's July 5th actuarial memorandum, correct? Correct. You prepared that and are familiar with it? Correct. And then exhibit 19 is your supplemental pre filed of July the 11th. You're familiar with that, prepared it, correct? That's correct. And then exhibit we're up to the last exhibit in that first section exhibit 21. That's pre filed testimony of Jackie Lee. And you reviewed that and are familiar with it, correct? That's correct. And then I'd ask you to go there's healthcare advocate exhibits. And then there's post binder additional stipulated exhibits. Do you see that? I do. Those are the exhibits that were distributed after we had already sent out the binders. So let's go through those. 34 and 35 are MVP's responses to objection eight, correct? Correct. 36 is a CDC Vermont vaccination rate document as of July 14. Do you see that? I do. 37 and 38 are MVP's responses to objection nine for individual and small group, correct? That's correct. Exhibit 39 is July 18th. July 18 MVP updated rate increase summary table, correct? Correct. And 40 is 40 and 41 are tables at MVP prepared relating to the COVID vaccine adjustment and the historical large claim, correct? That is correct. And 42 is a document from last year's hearing. The July 27, 2021 L&E post report addendum on some historical analysis of possible budgets, correct? That's correct. And then finally 43 and 44 is MVP's responses to objection six, correct? Correct. So those that I identify that MVP prepared you're familiar with those and help prepare those and include them as part of your testimony, correct? That's correct. And the other documents you've reviewed and are familiar with, correct? Correct. Next, I just as a point of reference, if you would go to exhibit one please in the binder and go to the very first page. And just below the exhibit sticky, you see a base number or it should be in red for people. It's 001, do you see that? Yes. You cringe, is yours not in red, Chris? No, the first one's black. The rest of them are red. I'm sorry about that. Okay, so when we're talking about exhibits today, and we talk about page numbers, I'll reference those baits numbers. So it may be the baits number rather than some other number on the page. But when we're just so people can accolate themselves, we'll be referencing the baits numbers. Okay. All right. Chris, I want to start with at a high level, talking about the rate increase and identifying Melanie's recommendations. This is high level. We'll then get into substantive issues, which you can explain. Okay. So starting with the original filing, would you go to exhibit one please? And this is the individual rate filing from May, correct? That's correct. May 6. Correct. And if you go to page two, that baits number, the red number on the bottom, page two. And over under general information, what was the original rate request of MVP for the individual? 17.37%. Thank you. And then if you would go to exhibit two, please, let me know when you're there. Okay, I'm there. And this is the rate filing for the Vermont small group of May the 6th, correct? That is correct. And if you go again to page two, and this was this was in May, what was the overall rate impact rate request of MVP for small group? 16.61%. Very good. Thank you. Next, I'd ask you to go to the L&E report, which is exhibit 12, please. exhibit 12. And Chairman Mullen, just as a as a timing, I just want to make sure that boards getting to the exhibits. Have you have you gotten to that exhibit 12? Are you there? Yes, I'm seeing nods. Thank you. Okay, so exhibit 12. This is the July 5. Actually, a memorandum of L&E, correct? That's correct. So would you please go to page 16 of the document page 16? Let me know when you're there. I'm there. And you'll see that there are recommendations and there are 12345 bullets. Do you see that? I do. Going to the last sentence, please read the last sentence, not the footnote, but the last sentence on the bottom. After the modifications, the anticipated rate change for the individual market is roughly 16.0% plus any impact from the updated hospital budget information. Okay, so we just looked at the original filing for individual and it was 17.37, correct? That's correct. And L&E is recommending that that be reduced to 16. Is that correct? Use straight subtraction? Yes. Would you please go to exhibit 13? This is L&E's actual memorandum for the small group filing, correct? That's correct. And same thing, if you can go to page 16 of that document, and there are again, five recommendations, please read the last sentence at the bottom. After the modifications, the anticipated rate change for the small group market is roughly 14.8% plus any impact from the updated hospital budget information. So we just looked at the small group rate filing in May, and it was 16.6 and L&E is suggesting, as of the date of this letter, a reduction to 14.8, correct? That's correct. And so what's the difference, simple subtraction? Roughly 1.8% correct, okay. So let's go back to exhibit 12. Go to those recommendations on page 16. And again, we're at a high level. I just want to go through the five bullets with you and get a sense of what we agree on and what we don't. What's the first bullet about? And do we agree or disagree? Sure, the first bullet is L&E stating that they believe our initial estimation of the hospital budgets for 2023 is reasonable and appropriate. But once the 2023 budget requests are submitted, L&E recommends that that information be factored into the rate change. And we agree with that, correct? We do. And we'll talk about percentages and numbers later. But based on the hospital budgets, what is the adjustment roughly for each of the filings? It's roughly, it's in the neighborhood of 7%. Thank you. Second bullet, what is that? And do we agree or disagree? The second bullet is L&E's recommendation that MVP remove the COVID vaccination adjustment that we made to the rates, based on our projection of 2023 costs, and that we use our experience period data trended to the projection period. We respectfully disagree with this recommendation. And they say that's a 0.6 difference if I'm reading that right? That's correct. Third bullet? The third bullet is is a procedural change to move a move a factor that was on page one of the URT or worksheet one of the URT rather, and represent that on worksheet two of the URT. We agree with this recommendation. It's it will better align the optics of the URT to the instructions and is has no impact on rates. It is a product of the difference between MVP's rate filing and the URT, but does not impact the rates themselves. The fourth bullet, what is it? And do we agree or disagree? The fourth bullet is L&E's recommendation to update the rates to reflect the final risk adjustment transfer amounts. MVP agrees with these recommendation, this recommendation. And what does that end up being in terms of the decrease in rates? It's a decrease of 0.1% Thank you. And the last bullet, what is it? And do we agree or disagree? The last bullet is L&E recommending that MVP's base period claims reflect a three year average of claims above a high cost threshold. MVP respectfully disagrees with this adjustment as well. And what do they indicate the amount of the disagreement is here? 0.7% decrease. Thank you. If you would go to exhibit 13, please. That's the small group filing. I want to go to that recommendations page of L&E's on page 16, please. Let me know when you're there. It's the same five bullet headings, correct? That's correct. But there are a couple of percentage numbers on some of these that are slightly different. Is that correct? That is. Would you identify those for the board, please? Yes. In bullet four, the risk adjustment transfers, it is a decrease of 0.3% and small group as compared to 0.1% in individual. And on the fifth bullet, the large claim adjustment, it's a, their recommendation is a 0.9 decrease as compared to a 0.7% decrease in individual. So small group on the large claim, they're saying they are raised to be decreased by 0.9. For individual, it's 0.7. Is that correct? That is correct. And then for the risk adjustment, it's rather than the 0.1 for individual, this is a 0.3 for the small group, correct? That's correct. Okay, so today you'll be testifying about the rates. And I'll ask you questions about the rates. And rather than doing this bouncing back and forth all day between small group and individual, is it fair to say that your testimony responses to my questions and others, I presume, will be for both filings? Yes. So you'll tell me different if you need to modify it as to the small group rate when we're talking about this stuff, correct? That's correct. Would you go to exhibit 18 please? Would you please just identify the document first? Just tell the board what this is. Yeah, this document is MVP's calculation of L&E's recommendations. So it is not us agreeing or disagreeing with the recommendations themselves, but simply putting their recommendations into our rate filing and in checking the the impact to the rates compared to L&E's stated impacts. And this is something the board asks us to do at least for the last several years we've been asked, correct? That's correct. And when you say put in the rate filing, you're actually putting in the rate filing software to crunch the numbers that L&E's recommending. Is that right? Correct. We place their recommendations in our rate filing. Yes. So we're not, we're just, this document reflects that we're agreeing on their math, not agreeing on their conclusions. Is that fair? Agreeing or disagreeing, but yes. Yes. Yeah, I misstated that. We're checking their math. We're not getting into actual opinions or things, correct? Correct. So would you please walk and somewhat slowly walk the board through the four items please and show what you found in terms of the math and where there might be some differences? Sure. So for the first bullet concerning the COVID-19 vaccination adjustment, MVP agrees for the individual flying that it results in a 0.6% decrease. For the small group filing, L&E also stated 0.6, whereas MVP has calculated as a 0.7% decrease. So just a slight difference there. And the second bullet for the updated risk adjustment, MVP has no disagreements. We agree with both of the impacts for both filings. The third bullet or the third point, the large claim adjustment MVP again agrees with both of the quantifications by L&E. And the fourth piece is just the total rate change. With all the adjustments, L&E calculated an increase of 16 for individual, whereas MVP calculated 15.7. And L&E calculated 14.8 for small group and MVP calculated 14.5. This is largely due to the interactivity of assumptions that when you make multiple at the same time, it doesn't have the sum of the independent adjustments. So there's just a slight difference, but nothing major. Terrific. Thank you, Chris. Now let's talk about the two areas of disagreement that we have with L&E. We'll start with the COVID vaccination adjustment. If you go back to exhibit 12, please exhibit 12. Okay, I think you just let me know when you're there. What page? Let's just go to the exhibit first. So on this one, you just talked about the calculations here. There was just the math difference, where we calculated a point seven on the small group, correct? And they said point six, other than that, the math aligns, correct? Correct. Go to page eight, please of the exhibit. And you'll see at the very bottom, there's a heading called COVID-19 vaccinations. Let me know when you're there. I'm there. Now, this is the section where L&E talks about this COVID vaccination issue and the issue we disagree on. Correct? It goes into page nine. That's correct. So as I understand it, you have two subjects of dispute as it relates to L&E's opinions on this, correct? Correct. And what would you just identify those two and then we'll talk about? Sure. The first being the utilization rate of the vaccine for, you know, percent of members getting vaccines. And the second being the unit cost of the vaccine. Okay, so let's start with that utilization then. How did MVP consider vaccine utilization please? Sure. So MVP's experience period data, we believe is highly suppressed due to the mass vaccination sites that were available to members in 2021, where MVP did not get billed for these vaccinations. So MVP's experience period data shows a vaccination rate of 37%, meaning that 37 percent of our members received at least one vaccine, which we know is well below the Vermont one dose rate of about 95%. So there, there's, we are certain that the mass vaccination sites were vaccinating our members at no cost MVP, which we're not complaining about. But those max vaccination sites are largely have gone away or continuing to go away and the vaccines are now being billed to the insurers. So as a result, MVP chose to use a projection by CMS, a nationwide projection that used a utilization rate of 52% assumed for the booster shot. This is, we felt an appropriate utilization assumption because we know we are unsure what the booster rate will be. But we know that Vermont Vermonters have been very good at getting vaccines and will likely be higher than the nationwide average. So we figured the CMS number would provide a good, a good balance for that compared to our experience period data. So the MVP utilization figure, that's to be clear, that's when an insurer comes to MVP and says, pay for my shot, correct? It's not whether they got a shot free or otherwise. It's, it's, they come in, it's clean, right? The 37% represents the members for which MVP has a vaccination claim in 2021. It does not represent the members who have been vaccinated. MVP has no insight into if a member went to a state run or federally run vaccination site and, you know, FEMA funds or any other type of government funds paid for those vaccinations, MVP does not get those records. And just to explain again, why is the CMS figure, what is the CMS figure again? What's the percentage? The CMS projection for 2023 vaccination cost is what CMS built in to has published, published publicly and built into their benchmark rates, which drives Medicare premiums. And we, we believe, well, Eleni did make the statement that, that is probably more suited to the Medicare population. That's where we felt that the Vermont's Vermonters being high, much higher national than the national average and vaccination rate is a little bit of an offset to that. And at the end of the day, we felt it was a better projection than using MVP's data alone because we know there's missing data in MVP's numbers. Fair enough. Would you go please to exhibit 36? 36? Let me know when you're there. I'm there. Okay, so this is a two page document, correct? That's correct. So go to the first page and just identify the document, please. Yes, this is, I believe, two screenshots of a CDC website stating vaccinations, vaccination rates and vaccination data. And down it's hard to read, but you've got better eyes than me. But down on the bottom right hand corner, right next to the Bates number, the 001, there's some dates and things. What does that say? Yes, it says data as of July 13, 2022, and it was posted on their website July 14, 2022. And above that, to the right, if I'm reading it right, there's a number 78.5%. Do you see that? I do. What is that number? That is the nationwide number of a nationwide percentage of people who have at least one vaccination dose. Okay, one vaccination dose, correct? Correct. And then if you go to the second page of the exhibit, please. And what is this show, please? This is a map of the United States where it has a color shading for your percentage of people getting at least one dose of the vaccine, where Vermont is, I believe this is an interactive website where Vermont has been clicked on. Vermont has been clicked on, so a little more information has been given. And Vermont's percent of the population receiving at least one dose is 95%. Okay, so to summarize, the MVP rate for vaccination claims last year is 37%, correct? That's correct. And then the CMS figure is 52%, what they're projecting for next year, correct? That's correct. And then this exhibit shows that 95% of Vermonters have gotten one dose, 95%, correct? Correct. So based on that information, as you sit here today, do you believe that using the 52% is reasonable? We believe the 52% is reasonable. As I stated earlier, we have little competence in the accuracy of MVP's experience period vaccination data due to the mass vaccination sites. So we wanted to rely on a more standardized projection and feel of what the federal government has published that the cost would be in 2023. And what about the notion of booster shots, subsequent shots? I think at this point, nobody knows. I mean, it's been a discussion for, this was a discussion for the past two rate filings now of when will the first one was when will the vaccines be available? We had that discussion in mid 2020. And then last year, it was how many booster shots, if any, and when are the booster shots going to be available? I'm not a medical professional. I don't know the signs behind the effectiveness and length of these boosters, but everything that I hear at this point is it's going to be similar to a flu shot type of annual or semi-annual dose. So that's what we have. That's the information we have, and that's the information we have to go on. Thank you. So now let's talk about unit cost. That was the second issue, I think you raised with that we have a difference of opinion on the vaccination. That's correct. What is MVP's position on unit costs and the basis for that position, please? MVP's position is that in 2023 the cost to MVP for a vaccination will be $104. This is comprised of $40 administrative fee, which is what is the only thing MVP is currently paying, and then an additional $64 per shot for ingredient cost. Currently, the federal government is paying the ingredient cost, but that is according to publications and what we've heard, it's the federal funds are running short on that and it is fully expected the carriers will be picking that up in the near future as evidenced by CMS building that into their Medicare benchmark rates, which to us was a clear indication that the federal government expects insurers to be paying that in 2023, as that is a component of Medicare premiums that the government would not charge if they did not believe that was going to be a cost. So currently, MVP's experience is roughly $40 per shot as stated. I believe that's a that's a federally set figure for administrative cost and we just believe that the extra $64 ingredient cost is going to come to MVP. We believe that as a matter of fact, not a not speculation. Now the speculation could be around whether it's going to be 65, 64, 75, 55. I think that's unknown at this time, but it will be an additional cost. And again, at this time, our best estimate is the federally published numbers for the expectation of the ingredient cost. OK, so let's talk a little bit about Ellene's position on unit cost. Would you go to exhibit 40 please? Exit 40. I have to get there myself. Hold on a second. Here we go. OK, so would you please identify these documents generally? What what do we have here? Sure, we have two tables that are were developed to show what impact on the rates the. Essentially the shift in unit cost would have even if taking in MVP's utilization. So in Ellene's recommendation, they mean for a second just so we could follow. So these are these are two tables that MVP prepared, correct? That's correct. And the purpose of these tables is to quantify. Even if. You agreed with the utilization rate of Ellene. This is how we would play out with the ingredient costs. Is that a fair summary or can you state that better, please? That that's generally correct. Essentially these tables were created to show that if you take into account the projected increase in unit costs that the utilization rate doesn't. Even if you kept MVP's utilization rate, it would provide a an increase to our initial proposed rates, not not a decrease as Ellene's suggesting. So it's just, you know, sim the math, you know, to put it simply is we currently pay $40. We're projecting $104. So even if the amount of shots MVP has to pay is the same, that's an over doubling in cost, right? It's like a 2.5 almost in cost. So it. There we are expecting a significant uptick in vaccination cost, whether or not utilization is factored in. So OK, so the table is reflecting and then I want you to walk through the table. Even if you use the 30 per 37% MVP vaccination claims of last year, even if you use the 37%. This table reflects. If. That coupled with the unit cost being 104, what the impact would be correct? Correct, and that was in Ellene's recommendation. They they made the statement something like we believe MVP's experience period, you know, experience trended to the future is an is an appropriate approximation for the cost. And so we we said OK, if we keep everything the same, but just change the unit cost, because we believe that that is pretty a pretty firm projection, what would that result in? And that results in a higher figure than the CMS projection that we initially state that we initially went with. Terrific, thank you. So if you could walk me through on the left table, that's for individual market, correct? That's correct. OK, so just walk through the MVP utilization column. Sure, so this at the top, you can see our experience period cost of 265 that that number doesn't change. None of the other numbers are different than what we've provided in in the objection in the data to Ellene, except for the unit cost per shot goes from $40 essentially to $104, which you can see results in a projection period cost of $7 as where I believe the CMS projection was 631. So Ellene is suggesting we use the 265 trended. We initially proposed the 631, which we stand behind and still believe that's a reasonable approximation for the future, given the data quality issues. But we just wanted to represent if using MVP utilization and increasing the cost, you would also get to a figure in the neighborhood of the CMS projection. So it shows the impact of the increased unit cost is really what we're trying to show here. And what is that last row then? What's the percentage? The percentage is 0.12%. And that's relative to our initial proposed rates. And then similarly, you don't need to go through all the whole table, but just go to that last row on small group to the right. What's that figure? 0.15%. And that's driven by a little bit higher utilization rate. Very good. OK, thank you. I want to go to the second area of dispute, which is on a large claim adjustment. So if you go back to exhibit 12, please, and go to page 16 again. And the sixth bullet, this is this large claim adjustment disagreement. And this individual filing, exhibit 12, shows a 0.7 decrease. And I believe you already testified to 0.9 for small group, correct? That's correct. And we confirm their math. We don't agree with it, the rationales, but we confirm the math, correct? Correct. So if you go to page 11, please, let me know when you're there. I'm there. And see the fourth paragraph has a heading large claims adjustment. Do you see that? I do. So this is where L and E talks about this issue of the large claims, correct? That's correct. So do you have disagreement with them on this? Yes. And are there two areas of disagreement? That's correct. Would you first just identify the two areas of disagreement? And we'll talk about it. Sure. The first area of disagreement is the general rationale for the adjustment. So just the reason behind making this type of adjustment, the second reason is more from a technical math standpoint of calculating the adjustment itself. We have some concerns with the math being used in such an adjustment. OK, thank you. So let's talk about the first one. And then it's a difference of actual real opinion, basically, correct? That's right. So tell me about that. What do you believe is proper for large claims? And what does L and E believe? Sure. So in this recommendation, L and E is suggesting that MVP's 2021 claims, large claims above 200,000 are an outlier. And that should be replaced with the three-year average. This is, in essence, a smoothing technique, a pooling technique. You can use either word to reduce fluctuation over time. MVP generally agrees that smoothing and pooling is a valid technique to use in certain circumstances. The circumstance for that is fluctuation over time of claims. MVP does not see what's happening in our Vermont block of business as a fluctuation of high-cost claims, rather and increase the high-cost claims. As you can see, starting from 2018, it's a steady increase. And 2021, in our emerging experience in 2022, tells no different. And can I interrupt for a second? Are you referring to that table on page 11? I am. Sorry. That's OK. Go ahead. Yes. Yes. So that table shows a steady increase. And MVP believes that pooling or smoothing data that's continually increasing is not reducing fluctuations in the future based on historical data. It's suppressing data. If you take an average of something that's continually increasing, you're always going to get a lower number than your most recent number. Pooling should have the ability to go pooling, smoothing, should have the ability to go both ways based on just that the claims would fluctuate over time. But that's not the pattern we've seen here. And what you just described, MVP's thinking on that, are we alone in that? In the rat? Go ahead. In what you just described, using the more I think I won't say it exactly, right? But this isn't an averaging. It's simply showing an increase over time. And that's what we should be basing our decision on. Is that correct? Correct. I think that there's actuarial professional discretion to look at this and say whether or not you've pooled in the past is every year is an independent decision. And looking at the data, MVP does not believe that 2021 is an outlier to the extent that we think 2023 is going to go to the average of some historical number. We believe this is, in effect, a new norm in where we'll operate. And what about Medicare and Medicaid? In general, this phenomenon of increase to large cost claims is something that MVP has been experiencing across all of its footprint. Thank you. So the second point of dispute relates to how Ellen E. quantified their opinion. Would you walk the board through the issues there? How many are there in your view? Sure. Yep. I have three general points on the math being used here that we disagree on. And I would like to state up front that this is simply in the calculation of the adjustment and that if an adjustment is to be made, we just want to ensure that the proper math be used to do it. And so the first disagreement is based on the averaging use. Ellen E. is taking a three-year arithmetic average of the prior three-year claims, but you can see in the table on page 11 that MVP's membership fluctuates over time. So a difference in membership, you would expect a difference in claims. That's, you know, that follows. As a drastic example, if one year you have five members and the next year you have 100 members, you wouldn't average the two total claims for those years and say that's what you would expect the future to be. It would be dependent on the membership count that you expect to have or that you've had. And so MVP believes that the averaging should be done as a three-year average of the PMPMs, not a three-year average of the total claims, since that puts everything on a per member basis and can be adjusted for the membership in the projection period or the membership time period used. It does not allow for fluctuations in claims due to fluctuations in membership. And this PMPM gets you to apples to apples. It's apples to apples. Yep, it's apples to apples in the sunset. It brings everything to the amount of claims above the threshold on a member basis. So it doesn't matter if you have five members or a million members, it represents for a given member, that's the number. And so that should, we believe that's the average that should have been used. And what was the second issue? The second issue is the lack of trending of the adjustment. So L&E is averaging 2019, 2020 and 2021, but medical trend exists every year. And that, what is trend? Medical trend is essentially the suite of services and things that you can get done at medical providers goes up every year. That's seen through the hospital budgets and just generally is a major component of rate increases year over year is just trend. And so a claim that happened in 2019 would not cost the same in 2019 as it would in 2021 for the same exact thing to happen. Therefore MVP believes that 2019 should be trended to a 2021 basis and 2020 should be trended to a 2021 basis in order to take that average because you're averaging three like things at that point. Now that does introduce the possibility and we'll see in later exhibits that there could be a claim that was 10, there could be 10 claims that were 195,000 in 2019 that would have been over 200,000 in 2021 based on medical trend. And that should be accounted for. That's a key component to making a normalized adjustment which is what is attempting to be done here. And what's the third quantification, clarification you'd like to make? Sure. So the third one is not actually impacting the adjustment but it's a presentation and based on our recommendation of the calculation of the adjustment, it will become important. So in the table on page 11, the members column does not represent MVP's average membership in that given year. It represents MVP's membership as of February of that given year, which does not take into account any membership changes that MVP would have had between February and December, which can fluctuate considerably due to the volatility of the small group employer market and the individual market. So any changes that happened there would be reflected in claims but are not reflected in that membership figure. MVP believes that column should show either total member months or total member months divided by 12 to give you average members in a given month. Further, the last column in that table, PMPM, is just the division of the large claims column and the members column, which is labeled as a PMPM but is really a PMPY per member per year because the membership figure represents members at a given point in time. If the members column is updated to reflect member months then that division can stay in those numbers would update appropriately but the figures that are listed there are not PMPMs. It is not too, in 2021 it is not, the claims were not $275.70 per member per month above 200,000. That would be per February members of 2021 per year, which is just a misleading representation and we just propose that that math, that math gets altered if an adjustment gets pushed through. Right, and just so the record's clear, you said misleading, it's a mistaken, right? I don't think Elleny's trying to mislead anybody, correct? Correct, I guess my point is simply if you look at that you could interpret it as $275 per member per month but that is not the correct figure. It'd be confusing. Correct. Would you go to exhibit 41 please? Okay, so as I understand it, you had two areas of dispute on this issue. One was actuarial opinion and two was on the math. Would you please explain what this document is, who prepared it and what it shows? Sure, MVP prepared this document to essentially incorporate the updated calculations that I just talked through and quantify what impact that would have on the rates. So in the first table for the individual market, we've incorporated the trending and we've also replaced the membership figure with member months and taken a member month average instead of an arithmetic average. That results in a 0.62% decrease the rates as compared to the 0.7 Elleny had calculated. So it's a slight reduction to the decrease. The table on the right for the small group market includes the same changes, trending member months and the PMPM average and results in a negative 0.56% or impact to rates as compared to the 0.9 Elleny calculated the first time. This one is a bigger increase because the 2019 column had several claims that were just under 200,000 which when accounting for trend take it over 200,000 which increases that line item which increases the average which decreases the adjustment. So that is MVP feels like that is actually sound math that is the only actual sound method you should use when doing an averaging like this. If you compare separate time periods you need to trend them. So we believe that the adjustments on this page the 0.62 and the 0.56 are the correct quantifications of the recommended changes proposed by Elleny. So if you go with Elleny's averaging route and you make the three adjustments that you just testified to on the individual market it goes from 0.7 reduction to a 0.62 reduction. Correct? That's correct. And if you do the same thing on the small group their 0.9 reduction goes to a 0.56 reduction, correct? Correct. And I do want to note that in Elleny's objections to MVP, excuse me, they did not they only asked for claims at 200,000 or above. So the updates to this would require MVP to provide Elleny with data within 15,000 say of 200,000 in prior years so that the trending could be done and the claims could be accounted for properly. MVP is happy to provide that data in post hearing questions upon request that's not an issue. Thanks very much. Okay, so those were the two issues in dispute. I'd like to talk about some other issues then with you if you would go back to exhibit 12 please and go to page four. I want to talk about the hospital budgets and medical trend. So go to page four of that exhibit and you'll see down on the bottom is the discussion about trend starts. And then on the next page, if you go to page five you'll see a heading for medical unit cost trend. Do you see that? I do. And then down below that at the bottom of the page is medical utilization trend. Do you see that? I do. So those are the two components of medical trend, correct? That is correct. Okay, so going to the medical utilization trend that goes on over to the next page on page six and it ends with the first full paragraph are you with me? I am. Would you read the last sentence of the first full paragraph please? L&E concludes that an annual utilization trend of 1.0% appears reasonable. Okay, so we have agreement with L&E on the 1% that's reasonable, correct? That is correct. So let's talk about unit cost. That was the first item. Remember back to the bullets. This is that first item in the recommendations to consider hospital budget information as it comes in, correct? That's correct. Since this rate filing in May and since this actuarial opinion exhibit 12 of July the 5th at the hospital submitted the budget proposals to the Green Mountain Care Board. Yes. And have you reviewed those proposals? Yes. Would you go to exhibit 34 please? And would you identify the exhibit please? Sure, this is MVP's response to an objection from L&E asking us to essentially quantify the impact of the proposed hospital budgets. And would you read the first two sentences in the response under number one there please? The average rate increase is 24.54 under the proposed hospital budgets on the GMCB website. This is higher than the 17.37 average rate increase that MVP previously proposed. Okay, so you testified earlier I just sort of asked you open in what the impact of the hospitals is about 7% and that is illustrated there, correct? That's correct. Would you go to exhibit 35 please? When you're there. I'm there. Would you identify the exhibit please? This is our response to L&E's objection asking us to quantify the hospital budgets the proposed hospital budgets impact on our small group filing. Okay, and same thing, would you read the first two sentences in the response under number one? The average rate increase is 23.78% under the proposed hospital budgets on the GMCB website. This is higher than the 16.61% average rate increase that MVP previously proposed. Okay, so same answer roughly 7% increased because that's correct? That's correct. Would you go to exhibit 39 please? Exhibit 39. Let me know when you're there. I'm there. First, just identify the document and did MVP prepare it? Yep, yes, this is an MVP prepared table that is meant to just show the kind of before and after in both rate filings from the initial proposal to the hospital budgets. Okay, so I wanna ask you about the first three rows just the first three rows right now would you please walk us through those first three rows for the for the board and explain? Yeah, the first row is the initial proposal. So that's what we proposed in early May. The second row is the updated figures with the proposed hospital budgets included. And the third row is the updated hospital budgets as well as updating the rate filings for the risk adjustment transfer adjustment that was recommended by Eleni and that we agree with. And that risk adjustment transfer was roughly about 0.1%, correct? In individual, yes. And then small group was 0.3? That's correct. Okay, okay, are you familiar with the timing of the hospital budget hearings in comparison to our hearing here today? I am. And they occur afterwards? That's correct. After the record is closed in this hearing, correct? Correct. And that could be, well, I won't ask you what's in the board's mind, but that's a challenge in your opinion? It leaves uncertainty across the board, I think for both MVP when trying to project and the board, it makes the job difficult, but at the end of the day, MVP just would like our rates to reflect the hospital budgets that will be approved. So last year, what did the board do to address this issue of timing? The board had Eleni do an analysis on historical budget cuts to the hospitals and based its approved rates, a decision on the MVP rate filings and assumingly the other carrier as well to based on that analysis done by Eleni. And what did the board do in terms of, in our final decision, what did they do in terms of estimating the cut to the hospital budget? It was a 1% across the board reduction. And they directed MVP to do that calculation pursuant to its order, correct? That's correct. Would you go to page four, excuse me, go to exhibit 42 please, four or two. I would caution you, we're not gonna talk about it, any of it, but there's some confidential stuff in this exhibit. But if you would please go to exhibit 42, page three. And there's two tables on page three, would you read the heading of the second table? Average differences in approved and submitted hospital budget increases. And this table reflects Eleni's response to the board's request for some historical budget cut data analysis, correct? That is correct. And the far right corner, that column is average for your difference, correct? Correct. And it's got various numbers for the hospitals, correct? That's correct. Now at the bottom, there's no weighted average reflected at the bottom, correct? For all the hospitals? Correct, it would be different based for each carrier's utilization. Okay, and were you able to do a calculation of that, what the weighted average would be? Yes. And what's that amount? 0.7%, negative 0.7%, I should say. Thank you. So the weighted average on average over the last four years, it's been a negative 0.7% weighted average, correct? Flame weighted, yes. Flame weighted, thank you. Okay, would you go back please to exhibit 39, exhibit 39. And this is the MVP updated rate increase summary table, correct? That's correct. And we've talked about the first three rows on this table already, correct? Correct. So I wanna go to those last two rows. What does row four reflect and what does row five reflect? Row four reflects the same calculation done in row two, except all of the proposed hospital budgets have been reduced by 1%. Row five reflects the same calculations as row three, except all of the proposed hospital budgets have been reduced by 1%. This is meant to give a point of reference to the board as to the impact of each percent on the 2023 hospital budgets. All right, so MVP is, as you sit here today, and as I indicated in the opening, MVP is seeking rate increases that are in the third row, correct? That is correct. 24.45 for individual and 23.44 for small group, correct? That is correct. And the last two rows are just a point of reference for the board, correct? That's correct. And row five includes the risk transfer reduction. Correct. It does. That's correct. I would ask you to go back to exhibit 12, please. Exhibit 12. I wanna ask you about pharmacy trend. Would you please go to page six? Okay. And you'll see a pharmacy trend heading in the middle of the page. And then pharmacy trend goes into page seven as well. If you would go to page seven then, and you'll see a table in the middle of the exhibit on page seven, historical allowed Rx trends. Do you see that? I do. Would you please describe to the board concerns that MVP has about specialty drugs? Yeah, so generally specialty drugs are a significant driver of pharmacy costs. They make up a very small percentage of the claims themselves, but a very substantial percentage of the cost. And as the FDA continues to approve and release these new specialty drugs to the market, it is expected to continue to have high utilization and high cost increases to pharmacy. It is expected to improve patient outcomes. So specialty drugs, in a lot of cases, are a wonder to the members who need them. But we did want to just point out that in general, our pharmaceutical cost is driven mainly by the steady increase in utilization in costs. Well, utilization of specialty drugs as well as just the pure cost of the drugs themselves. Thank you. Let's turn now to contributions to reserves. First, what did MVP propose this year for their CTR? 1.5%. And what is CTR? CTR stands for contribution to reserves and it's essentially the amount of money that MVP is requesting to make sure that its reserves continue to keep pace with claims. So MVP has reserves that are set aside to pay the claims and ensure that each member, when they go to get care that it's paid for, and it ensures MVP solvency. As claims continue to rise year over year with medical trend, MVP's reserves need to rise as well to ensure that we can keep paying claims effectively for our members. Thank you. And would you go please to exhibit 12, page 14? And let me know when you're there. Okay, I'm there. And you can see at the top adding changes and contributions to reserves. So this is where L&E discusses CTR, correct? That's correct. And if you go to page 15, please, that discussion continues. And then the third paragraph, starting with L&E believes, if you could read that first sentence. L&E believes the CTR assumptions are reasonable and appropriate as file. So L&E believes our CTR is reasonable and appropriate, correct? That's correct. Go back to page 14, please. And the third paragraph. And if you would, please read the sentences in that paragraph, take your time. The proposed risk margin of 1.5% is consistent with the risk margin that was proposed in the 2022 filing, but an increase from the ordered 2022 risk margin of 0.5%. The 2023 projected federal loss ratio using this CTR is 91.9%, which exceeds the statutory minimum MLR of 80%. Would you explain to the board the significance of the comparison of the CTR for MVP and the MLR of 80%? Sure. The MVP projected federal loss ratio of 91.9% indicates that for every dollar of premium MVP takes in, we will pay out 91.9 cents in claims. The statutory minimum is paying out 80 cents per dollar, which MVP is being significantly higher than that indicates that we are running lean as a company and we are not overcharging Vermonters for any other cost than what is needed to continue to run the business. Thank you. Would you go down to the fifth paragraph? It's the last paragraph under that table. Let me know when you're there. I'm there. Would you read the paragraph, which starts as a reason for this check, please read that paragraph. As a reasonableness check of the proposed CTR provision, L&E reviewed the center for consumer information and insurance oversight public use files. In 2022, there were 442 carriers who submitted the individual or small group ACA filings nationally. The filed CTR varied from negative 17% to positive 9%, but most often fell between 0 and 5%. The mode is between 2 and 3%, and the premium weighted average CTR for all carriers was filed as 2.4%. MVP's filed CTR of 1.5% would place it around the 27th percentile for all QHP carriers. Thank you. So 442 carriers, correct? Correct. And the premium weighted average was 2.4%, correct? That's correct. And MVP's CTR of 1.5 falls at the 27th percentile, correct? That's correct. Which it's been a while for me since taking math and graded school, but that's on the lower end, correct? Correct. That indicates that 73% of filings would have a higher value than what MVP projected or proposed asked for, I should say. Okay. So briefly, I wanted to go through some wording with you, some words that L&E uses here just to clarify. Would you go and you see that first table on page 14? I do. And it shows the CTR number, total CTR of 1.8. You see that? Yes. And you see the number above the 1.5%? Yes. So what is the CTR that MVP is seeking this year? The CTR that MVP is seeking is 1.5%. L&E here has risk margin labeled as 1.5%, but then below speaks to CTR as 1.5%. I think it's just a term of art difference. Okay. So if you go down, let's go back to that reasonableness check paragraph, the fifth paragraph, read the last sentence. MVP's filed CTR of 1.5% would place it at around the 20th, 27% for all QHB carriers. Okay. So the 1.5 is the accurate figure, correct? That's correct. And the CTR figure that's of 1.5 proposed by MVP, that does not have a bad debt component, correct? That's correct. Okay. So I wanna focus on page 14 on that second table. What does this table show? And could you explain these amounts over the years comparing actual to expected? Correct. Yes. This table shows actual to expected risk margin, otherwise known as profitability in the past three years. In 19, we were slightly below the ordered. In 2020, we were slightly above. In 2021, we are significantly below. Now, it goes to, it is worth noting that the expected CTR here is based on what initially MVP proposed and what the board cut to, if any, any other cuts that were made to the rate filing and may have impacted MVP's determination of expected profitability are not included in that expected figure. Can I just to clarify that it's the first time I got confused, Chris, throughout all your testimony, you're doing a great job, but there those figures are what the board ordered for CTR in those years, correct? For CTR, correct. It's not what MVP asked for, it's what the board ordered, correct? That's correct. Go ahead, explain. Yeah, so I think it just, it shows that 2020 MVP was, did make money due to the suppression in COVID-19 or due to COVID-19 where we could not, a lot of positions, offices and certain services were shut down for a period of time. But we wanted to make note of this because there may be some notion that 21 is offsetting 2020 and carriers are, starting over, it's all even, it's all good, but MVP did lose significantly more money in 21 than it made in 2020 and that is of concern. And tell me about the loss in 2021, please. Yes, 11.1%, which on a run rate basis is somewhere in the neighborhood of 23 million. And if MVP were to lose 11% in 2023 and a year after that and so on, is that a sustainable business model? No, it's unsustainable and would threaten solvency. I wanna ask you next about RBC. If you would, well, first of all, what is RBC? RBC stands for risk-based capital. And in short, it's a metric that is used to evaluate company solvency. Okay, so let's go to page 15 of the exhibit. And there's a paragraph, the second paragraph, which is below that table. I wanna ask you about that paragraph. Let me know when you're there. Okay, I'm there. Okay, this paragraph has five sentences. So I want you to read, well, let me just ask you, the first sentence you agree with, right? Yes. Would you read the second and third sentences, please. Vermont business accounts for approximately 5% of MVP's overall business. Therefore, L&E believes it is not a significant factor in determining company RBC ratio. And what are your thoughts about those statements? While MVP does agree that, as Jay stated earlier, that MVP's business accounts for approximately 5% of overall business, or between five and seven and a half, depending on the metrics that you use, we definitely disagree that is not a significant factor in determining the RBC ratio. While it being a small percent of the business may mean that it's a small portion of the denominator of the RBC, the numerator of the RBC is total capital. And in 2021, MVP health plan in total lost, honor financial statements, lost about $32 million. 30 million of that came from the Vermont small and individual markets. That's about 96% indicating that is the main driver, that was a large driver of the decrease in RBC, was the fact that we lost $32 million and that reduced our capital. So the notion that Vermont is so small, it can't impact MVP is false, because we lost 96% of our money in Vermont last year, and that was the direct contributor to the lower RBC ratio, which we want to point out that it is, it can and will have an impact due to the magnitude of the Vermont losses. And did you hear Jane is opening and I may not quote it exactly, but I wrote it down. He said something to the effect of Vermont should not be subsidizing bad results in New York. Did you hear that? Yes. Vermonters shouldn't be. And do you agree with that? I agree. And I believe that we state this every year, but Vermont is rated as its own block of business. New York is rated as its own block of business. Even within Vermont now, small group and individual are rated as their own blocks of business. And what happens in one has no impact on the other. The data is independent and it's all rated separately. So a bad year in Vermont, New Yorkers shouldn't have to pay for that and vice versa. Correct. That's correct. Would you please read the fourth sentence in the paragraph? L and E notes that it is not sustainable to have long-term negative profits and therefore a higher CTR could be justified. Agree with that? I do agree. It is not sustainable. And then read the last sentence, please. Given this information, L and E believes that a CTR between 0.5% and 3% would be considered reasonable. So why didn't MVP this year say 2% or 2.5% or 3% for their CTR request? Because MVP's rates this year that we're proposing for 2023 are not designed to make up any losses that we had in 2021. They're simply designed to get our premiums to a level where we can continue to be solvent at a stable level. And the 1.5 is what we feel is the appropriate increase to reserves to get us there. We have no intention or desire to charge Vermonters any more money than we have to to cover their healthcare. And that by that, we think 1.5% is appropriate and any more would be trying to recoup prior losses, which is not actually appropriate. Thank you. Would you please go to exhibit 14 and identify the exhibit, please? This exhibit is the DFR solvency impact memo that they send for the individual market every year. An exhibit 15 is the same letter, but for the small group filing, is that right? That's correct. And you've reviewed them and are familiar with them? Yes. And the substance of the two letters are the same, except one is for the individual and one is for the small group? That's correct. So let's go to exhibit 14 and please read under summary of opinion, the sentence. The proposed rate filed by MBPHP would not negatively impact its solvency and the company otherwise meets Vermont financial licensing requirements for a foreign insurer. And you would agree with that? I would. And you would agree with that under the new proposed rate, that third row in the exhibit we talked about? Correct. Okay, second page of the exhibit, the third bullet, would you please read it? Finally, in all, in 2021, all of MBPHP holding companies operations in Vermont accounted for approximately 7.5% of its total premiums written. DFR has determined that MBPHP's Vermont operations pose little risk to its solvency. Nonetheless, adequacy of rates and contributions to surplus are necessary for all health insurers to maintain strength of capital that keeps pace with claim trends. You discussed earlier, you took issue with L and E describing and Jay talked about it in his opening, MBPHP being a small, tiny bit of the business overall so it really doesn't matter what happens in Vermont. That's not exactly what he said, but you know what I'm getting at, correct? That's correct. So, when DFR references, well first, the percent of business, we've heard 5%, 7.5% without getting into great detail, it's somewhere in that range, is that correct? Yes, I assume that these are two different sources, maybe at two different time periods and result in slightly different numbers, but it tells the scale of it, yes. And for what you described earlier, you would disagree with the notion that the smaller business in Vermont doesn't have an impact, correct? I, yes, I disagree with that for the same reasons as stated before that in 2021, Vermont accounted for 96% of MBPHP health plans losses, which include a lot of New York business. So it's not, it's, I don't want to make it, I want to make it clear that Vermont's not the only thing on MBPHP health plan, there is a lot of New York business and Vermont accounted for 96% of the losses. And then under impact of the filing on solvency, would you read the last sentence please? Based on the entity-wide assessment above and contingent upon the GMCB actuaries filing that the proposed rate is not inadequate, BFR's opinion is that the proposed rate will not have a negative impact on MBPHP solvency. And would you agree with that with the proposed rate, as you sit here today, of individuals 24.45 and small groups of 23.44? Yes. So go to exhibit 39 please. Let me know when you're there. I'm there. So again, it's this third row on exhibit 39, that's what we're seeking here, correct? At the moment, yes. And those rates are not inadequate in your opinion, correct? That is correct. Next, I want to ask you about some non-actuarial issues. If you would please go to your pre-plot testimony, exhibit 16, 16 please. And then I would direct you to page six, question 19. Would you please read the question and just tell the board what this sets out, Jim? What steps does MBPHP take into lower costs and establish that it's proposed rates promote affordability access to care and quality of care for monitors? This question lays out the groundwork for the remaining questions or a subset of the remaining questions in the pre-plot testimony of which MBPHP talks about the steps that we have taken or plan to take to do all of the, parts of the statute, affordability access to care and quality of care. Okay, thank you. And so there's 15 items listed there, I believe, correct? That's correct. And then if we drill down deeper and provide more information about one of the items, it's referenced there next to the item, correct? That's correct. And with these items, your pre-plot testimony here, your testimony today, all the other filings in the case and evidence, evidence, some of the steps that MBPHP's taken to lower costs, promote quality of care and access, and establish that the rates proposed are affordable for monitors. That's correct. In your opinion, will short-term underpricing make insurance affordable in the long run? No. Why not? Because each year is priced on its own and the fact that underpricing happens will just be accounted for in the next year's rates in the sense that every year MBPHP is projecting rates to the year of the rate. So this year we're projecting to 23. If the claim costs in the future, we're gonna continue to do that and the premiums will be what they are, last year's premiums don't impact the following year rates. So underpricing is not going to make healthcare affordable or not make long-term affordability. Thank you. Let's go through this etch story criteria then, please. MBPHP's proposed rates is modified by your testimony and other evidence for individuals of 24.45 and small group of 23.44 includes the hospital budget increases proposed if approved by the board. And the risk adjustment of the 0.1%, is it your opinion that those rates are actually sound and reasonable? That's correct. Do the MBPHP rates meet the standard of affordability based on the rate filing other evidence in your testimony today? Yes, the rates are affordable because they align the healthcare costs and the benefits provided at the minimum costs we've been able to achieve. Do the rates promote quality of care and access to healthcare based on the rate filing other evidence in your testimony today? Yes. Is the rate filing unjust, unfair, inequitable, misleading or contrary to law based on the rate filing other evidence in your testimony today? No. Are the rates reasonable based on the data that we have? Yes. Are the rates actually really sound and fairly charged premium for services covered? Yes. Are the rates excessive, inadequate or unfairly discriminatory? No. Are the rates reasonable relative to the benefits that are offered? Yes. Do they provide for payment of claims, administrative expenses, taxes, regulatory fees and have reasonable contingency of profit margins? Yes. So they are adequate? Yes. The rates exceed the rate needed to provide for payment of claims, administrative expenses, taxes, regulatory fees and reasonable contingency for profit margins. Are the rates excessive? No. So when I asked you if the rates exceed, you said correct. You want to think about that response? Yes. Sorry. I was, can you reread the question? Sure. There's all these double negatives. It's my fault. So let me ask you the question. Do the rates exceed the rate needed to provide for payment of claims, administrative expenses, taxes, regulatory fees and reasonable contingency or profit margin? No. Do the rates result in premium differences among insurers within similar risk categories which are not permissible under applicable law and do not reasonably correspond to differences in expected costs? No. So they're not unfairly discriminatory? That's correct. Would you agree with me that the statutory criteria we just went through are interrelated? Yes. They're not siloed. That's correct. Any adjustments to a rate increase for whatever reason all feed into the final number? Correct? Correct. It's important that the final number is actually sound and reasonable. That's correct. In this case, the 24.45 for individual and the 23.44 for small group, are they actually sound and reasonable? They are. And in your opinion, do those rates meet the statutory criteria? They do. And if the board cuts the final number on non-actuarial grounds, is there a risk that the rate would no longer be adequate? Yes. Thank you very much, Chris. That's all the questions I have at this time. Thank you, Mr. Farni, Mr. Pontiff. I think at this point, we could all benefit from a short break and I think we're doing well on time. So why don't we reconvene this hearing at 10 after 10? Thank you. Thank you. We're back on record in the matter of MVP healthcare is 2023 individual and small group rate filings. We just finished the direct testimony of Christopher Pontiff and now we'll move to cross. So Mr. Angoff, you have questions for Mr. Pontiff. Yes, I do. Thank you, Mr. Herring, officer. Good morning, Mr. Pontiff, how you doing? Good morning, I'm good. How are you? Good. Could you please turn to exhibit 11 and just go to the last page there, the chart, which is the last page of that June 27th letter. Okay. Okay, and what I'd like to do is to make sure that I understand and the board understands how much more people would be paying this year under the MVP proposed increases. On the second chart, that is the chart on the right-hand side of the page, can you go down to the line where it lists the data for 300% of federal poverty? Do you see that? I do. Okay, and so what this shows, what that line shows, doesn't it, is the additional amount that people would be paying today for MVP's lowest cost, bronze, silver, and gold plans under MVP's proposed increase, is that right? Yes, with the assumption that the American Rescue Plan Act is not restored in any fashion, yes. Okay, and is that the, how much they would be paying in accordance with your initially proposed increase or does that take account of the additional amount that you've asked for based on what you believe the hospital budgets will show? That this table is based on the initially proposed increases. Okay, and so how much more would people be paying than the amounts shown here? Let's start with people with 300% of poverty. Yes, so I don't, those numbers are hard to calculate because it's based on the second lowest cost silver plan in the region, and the region which for Vermont is just the state, and given Blue Cross will have an impact of the hospitals, as we will have an impact, it's very hard to know how much that second lowest cost silver plan will be impacted to calculate the subsidies. So without a final decision, that's not a calculatable number at this point. Okay, well, can you give us a range or you just have no idea? It's going to be more. It would be more, that would be for sure. It depends on, like I said, the relationship between our increase and Blue Cross's increase. Okay, and does the additional amount more depend on the person's income level too? Meaning will it fluctuate by income level? Yes, the problem that you just described about the second highest or second lowest priced silver plan, does that affect the prices that everyone would pay regardless of what their income is or does it only affect people at a certain income level? It only affects people below the threshold, the maximum. Well, I believe without ARPA, it would be 400%, I believe is where the APTCs stop being available. So anybody below that, it would impact. Anybody above it would see the full increase to the premium. Okay, and so let's take somebody at 500% of federal poverty. So under your original increase for a bronze plan, they'd be paying $383 more than they're already paying, correct? That's correct. Okay, and then would they be paying an additional amount more based on the additional amount that you've asked for? Yes. Okay, and are you saying you can't calculate that, that you have no idea what that is? For those people in this table above 400%, the increase would be the increase to that plan. They would feel the full effects of the increase because they are not receiving any subsidies under this plan. Okay, so what increment would that, can you give me an example? What would the increment be? How much more would it be? So around 7%, if a premium is $500, that's $35. Okay, so the increase, the percentage is figured on the original premium, not on the amount of the increase, right? For anybody above 400% who will no longer qualify for subsidies, that is correct. They're paying the full price. Okay, so say somebody paying about 400 bucks more under your original increase and let's assume he's currently paying 500 bucks, he'd pay another 7% of that 500, correct? Correct. Okay, and let me just make sure I understand what some of the characteristics are of your lowest cost, metal level plans. What is the deductible for your lowest cost bronze plan? I do not know that offhand, that is an exhibit in our rate filing. I can turn to and give you that answer if you would like, but I don't know it off top of my head. Okay, yeah, why don't you turn to it and give me the answer? I believe it to be $5,800. That's the deductible for your lowest price bronze plan for an individual? Yes, yes, I, yes. Okay, and you have in front of you, I don't wanna take too much time with this, but do you have the same data for your silver and gold plans? Yes, the, no, sorry, I misspoke Jay, that would have been the highest cost bronze plan. The lowest cost bronze plan would be 9,100. Okay, and the data that you have in this chart are for your lowest cost metal level plans, right? Correct. Okay, and so what would the deductible for your lowest cost bronze plan is 9,100. What's the deductible for your lowest cost silver plan? I believe it to be 5,500. Okay, and then finally, for your lowest cost gold plan, what's the deductible for that? 3,200, I believe. Okay, and do you all not sell platinum plans? We sell one platinum plan, just the standard platinum plan. Okay, and is there a reason why data for the platinum plan isn't here? They're not outside of the fact that the platinum plans are not usually selected by members who are getting premium subsidies. There is a lower, a much lower selection rate in platinum because it's a leveraged impact because it's based on the silver plan, so they don't get as good of a deal per se on the platinum plans. They still have a high out-of-pocket premium cost. Okay, and they would still pay more this year like everybody else, right? Correct, it wouldn't change the relationship, no. Okay. Okay, I'd just like to ask you a couple of questions about the rest of this document, which is your responses to a couple of Tracy Hughes's questions, could you turn please to page two and look down at the bottom of question eight? Okay. Okay, you see question eight asks for, doesn't it? Among other things, the actual amounts that MVP received related to car sharing, reduction litigation, and risk card litigation. Do you see that? I do. Okay, and Mr. Pontiff, I mean this in the nicest possible way, but why didn't you answer the question? So for this question, we did reach out to our legal team and ask them and their feedback was they cannot speculate on the amount to be recovered because it is unknown at this time. Right, but that's not the question that I just asked and that's not the question that is part of this question. This question asked in addition for your expected recoveries, what were your actual recoveries related to car sharing, reduction litigation, and risk card litigation? And you did not answer that, correct? I believe that and I can follow up with our legal team but I believe that we have not received any monies to this point and that's why it was a speculation as to what would be recovered. Oh, interesting, okay, so your testimony is that MVP has never received any monies related to car sharing, reduction litigation, or risk card litigation, is that right? I can't say that for sure, I'm not in the legal department. I would have to follow up with them. Our feedback, their feedback to me was they cannot speculate on the amount to be recovered. And the reason they say they can't speculate as to the amount to be recovered is what? Because it's not known at this time. It would be pure speculation and it's, I believe it's a national situation and there's gonna be some allocation if monies are given and it was not something that we're privy to the value of yet. Okay, and have you followed the progress of either of those pieces of litigation yourself? Myself, not closely, no. You followed them a little bit? Not other than when it's brought up for us to confer with the legal team. That's something our legal team handles. Okay, by the way, you said you're the head of commercial pricing for MVP. Is that for the whole company, both Vermont and New York? That's correct. Okay, and at the year of your testimony, you said you did 10 filings, were those Vermont filings or were those both Vermont and New York filings? That's 10 for the state of Vermont. Five, I worked on five years of filings in both the exchange world, which is where we're now in large group. Okay, and without giving the names of each filing, can you just tell me what type of business those filings involve? Yeah, it's a small and individual rates for the past five years for Vermont and the large group rates, so for large employers. Okay, and do the large group rates include a 1.5% CTR provision, do you know? I believe we in the past have filed a 2% CTR provision. Do you know that? That is my recollection. And is that insured business or ASO business? That's fully insured business. Okay, can you turn to page three of Exit 11? Exit 11, okay, and go down there to question 10, please. Which concerns the 1.5 contribution to reserves. Okay. Okay, there is no statute is there that you're aware of that requires either Vermont statute or New York statute that requires a certain percentage increase on any given block of business, correct? To my knowledge, there is no statute that is, yes, that says you must increase anything by anything. It is more designed around protecting, generally protecting solvency of which that is a method to do so. Sure, but surplus is fungible, right? MVP doesn't have a certain amount of surplus earmark for New York business and a certain amount earmark for Vermont business, right? I'm unfamiliar with the allocation of our total surplus and how it flows into the financial statements. Oh, is that right? Who would be familiar with that? Our accounting department. Could you look at the table on the bottom of page three and there it shows your investment returns, your investment income for the last couple of years, you see that? That's correct. Okay, it is the fluctuation in those numbers simply due to the performance of the financial markets. No, the investment income you see here is essentially all realized gains from fixed income investments. Anything from the financial markets is not reported on a statutory basis until it is realized on a gap basis it is. So nothing reflected here shows any impact of MVP's unrealized losses in 2021 or 2022, either way for the financial markets. Okay, and this is, is this investment income for the company as a whole? This is for MVP health plan, the subsidiary. Okay, sorry. So does it cover both Vermont and New York business? It covers all of Vermont and most of New York. There is some New York that lives under MVP Health Service Corp, which is any other subsidiary that is different. Okay, and can you explain exactly how MVP factors investment income into its rate base? Yes, investment income is a component of our derivation of contribution to reserves. So it is part of the equation that we discuss and determine what we're going to propose for a contribution to reserves because at the end of the day, investment income is an increase to reserves, is an increase to free capital. And if necessary, MVP will take that into account to either request more or less contribution to surplus based on the performance. Okay, is there a line item in your rate filing where you either show an increased cost or a reduced cost based on your investment income? No, it is part of the derivation of the contribution to reserve. Okay, and are you familiar with ASOP 26? I am. Okay, and is it your position that what MVP does in connection, the consideration that MVP gives to its investment income is consistent with ASOP 26? Correct, I believe ASOP 26 says that investment income should be taken into account when rating. MVP does that by factoring it into, it is fact investment income is taken into account in the total premiums MVP offers or proposes to its Vermont members and New York members. And so in that sense, yes, it is taken into account. It is not a direct line item because as an actuary, it's our job to project future costs and align premiums with those costs and adjusting for investment income explicitly as a claim item would be inappropriate. Do you know whether there are any companies that do include investment income as a line item in the rate phase? I do not know. You don't know? I don't know. I don't review, it's not part of my job to review several other companies, Ray Fox. Very good. Could you turn to the next page, question 12 there? Yes. Okay, and that's a bad question and you gave exactly the right answer. I'm just gonna ask you to follow up on that answer. The question is, does MVP calculate a return on investment for its utilization management program? And you answered exactly the question that was asked. Your answer was yes. But now I'm just asking you, can you disclose what that return on investment has been? Yeah, so I can't give exact numbers because as I stated, return on investment on utilization management programs is one of the more difficult things in healthcare economics to achieve because there is an implicit assumption that you have to make on what would have happened given the program didn't exist. For example, if you have a program that's supposed to manage diabetes and diabetes costs go down in the next year, well, you don't know how much of that is a decrease because the members just handled it better themselves or how much was your program. So how much of the savings do you allocate to the institution of that program is a very difficult task to undertake. And so MVP does have several utilization management programs and we do attempt to calculate the savings of which I don't have the exact numbers that lives within the clinical department, but any explicit savings that are projected or anything that has materialized is implicit in the rate file. So can you give us, can you at least give us a range for the answer to that question? I don't know the exact numbers. It's factored into two components. One, it could be factored into the, it's in the claims if it's a historical program that is reducing 2021 costs. It could also be in our derivation or decision on utilization trends and or other trends at other facilities if we think that one of our programs is gonna reduce cost materially or if it's something outside of that, it could be a unique line item. So it could be any number of places with any number of values and I don't have an exact number for you. Okay, could you turn please, Mr. Pontiff, to exhibit four? Yes. Okay, and could you go to page three? And I have a few questions about question two. Okay. Okay, and you see in your first sense of your response, you say that MVP used the triple exponential smoothing forecasting method. You see that? Yes. So like most people, I've always been fascinated by the triple exponential smoothing forecasting method. But what I'd like to ask you is in the last sentence of that paragraph, you say that MVP has determined that the range of utilization trends forecasted by the model is too large to have confidence in the result. And I'd like to ask you, what was that range and why was it too large to have confidence in the result? Yes, it's a good question. Can I believe that that data is in the attachments to this exhibit and maybe we can go there to page, let me see, page 20 in here. You can see there's a table that says two-year trends and there's from the fifth to the 95th percentile and the values in the first row of that where you see the percentages are the annualized values. And so we, you can see that the fifth percentile is negative 5%, the 95th percentile is 12%. Part of doing forecasting and projections of data is not always, what does it give as a best estimate? But what is the range around that best estimate? There's a thing called standard error and the bigger that gets, any model can give anybody a best estimate. But if the model doesn't prove that the bounds around that are tight, then that model is not very predictive. And that's what we got here because the range is essentially 18%. So we felt that picking any number, if we use the 50th percentile, say of 3.4% utilization trend, just was no better than using a more industry or historical provided value because the data just did not seem credible and we attribute that to the decrease of services in 2020 and then the ramp back up in 2021, which is just confusing the model. So it's something that's likely to persist for some period of time until 2020 data can get out of the equation, but it's also difficult to smooth that and level it out. That's what the model attempts to do, but still results in an 18% range. I think I understood that explanation. I think it's a good explanation, but I don't know what document you were talking from. Can you point me to it? Yes, sorry. Page 20 in exhibit four. I don't know and maybe somebody on the Greenmount Care Board team or Gary can help me out here. This may have been the things that were added last night. That explains it then. I couldn't find it. Exactly right. Okay. Sorry. So where you were just talking from was based on a document that was added last night. It's an attachment that was initially provided with the objection, but I think the Excel files or PDFs in the attachment or in the objection were not added until last night. That's fine. I'm not going to prolong this. Let me try to shortcut it. So how do you determine the bounds of a reasonable range? That's also a good question and that's a difficult, it's a difficult question for me to give you a firm answer to. I think it's based on just professional judgment as you look at it and determine if you feel like, if you feel like in the 5th percentile, would we say that five out of a hundred years we would expect a negative 6% trend? The answer to us for that was no. So that's kind of how we tried to gauge it and same thing on the positive end. So if we had a range where we would say, maybe in five out of a hundred years we would expect a negative 2% trend or a positive 3% trend, that may be a range that we say, okay, that's justifiable we use that. So it's not prescribed. Okay. So is it fair to say then actuaries determine a reasonable range based on their actuarial judgment? Yes, I think that's fair. Okay. And is there any ASOP that limits that actuarial judgment in any way? There's a few ASOPs regarding data and data quality and that is part of what you're supposed to take into account and I think this is a data, I wouldn't say it's a data quality issue necessarily but it's a data quality concern and point of I think using this data would be more in breach of ASOP 23 given you know that there's confounding factors. Okay. And is there any societal actuary guidance which prescribes or limits the actuary's professional judgment in determining a reasonable range? Not that I know of as long as there's proper justification. I think justification is the big item. Okay. And can you give me an example of what would constitute just an example or two of what would constitute proper justification? Yeah. I think backed by data and just maybe contacts which I think is, I think what I just took you through in terms of that exhibit and why we decided not to use the range is what I would consider appropriate justification for not using that data. I get that. Okay. Are there any assumptions in your rate filing that you've made that you think are the only actuarial sound assumptions a reasonable actuary could come to? In terms of picking point estimates? No. Could you turn please to page, exhibit for page five. At the bottom of the page, you're discussing MVP's growth from 17% to 50% of the market there. Age five. Yes. Okay. That's correct. So were you the head of commercial pricing during this, during that entire period? No. Were you with MVP during that entire period? I joined MVP in 2017. Okay. Well, do you know how MVP came to grow so much and so fast? My understanding of that is the lower premiums. Okay. And do you know whether MVP ever did any retention analysis when it was putting together its rate filings? This year or in the past years? Since you've been involved with the Vermont individual and small group filings. Yes. We have looked at retention. Okay. And what did you find based on your retention analysis? It was actually quite surprising that there is a lot of churn in both the individual and small group markets where I'm going to throw out some numbers of, let's say we have 20,000 small group members, any given month. I think over the course of 2019 or 2020, we may have had 30, 35,000 unique small group members. So there is a lot. Well, the number per month doesn't seem to fluctuate. There is a lot of in and out, you know, and it makes sense in a small group, you know, small group and players are small. People come, they go on jobs and things of that nature. So that drives it. If you're talking groups specifically, if groups in the small group market are leaving us or staying with us, that's not something. It was more looking at membership over time. And did you look at the morbidity of the membership and in particular the morbidity of the additional membership that you gained each year? To the extent that we can quantify that, yes. And I'll just leave it there. I assume you have a follow-up to that. I'm sorry? No, I said I'll leave it there. I assume you have a follow-up. I don't want to answer your next question before you ask it. Actually, I didn't have a follow-up. I guess I should have. If that's your answer, I'll take that. Can you go please to page, still in exhibit four, six, seven, page eight. Okay. And there's a lot of discussion there in the middle of the page about your assumptions relating to COVID, right? That's correct. And I'm just going to ask you a couple of questions. In your discussion of line 13, in your last sentence you say that the assumption of 30% was derived from conversations with medical doctors and emerging claims. And I'd just like you to subscribe for me and for the board to the best that you can, what those conversations consisted of and how you came to arrive at that 30% figure. Sure. What we attempted to do before our conversations with the medical doctors was pull in the data and understand what the COVID services claim data looked like month by month from January of 2020, which nothing basically to the most recent data we had, which would have been February of 2022. Then we sat down with the medical doctors. We put them in front of them and said, here's what MVP is currently experiencing and had them talk us through the science of it, right? Like I'm not a medical professional. I don't understand the way viruses work, the way they transmit, the way they mutate over time. And if it becomes more or less infectious, more or less morbid, I don't know. We as an actual team are not charged with knowing that. So we had discussion. That's right. Correct. That's correct. So we had discussions around their understanding of and beliefs on where COVID will go in the coming years and our claims data that we've already seen. So we tried to blend the physician side of the medicine and the data side of reality and blended that together to get an assumption of 30% reduction. Okay. And so did you make an actuarial judgment or is that 30% assumption, a non actuarial assumption? I would say this is actuarial. At the end of the day, I had to make a decision and it's my, you know, it's my name on the filing, my name on the memorandum. This is the decision that I made. And we, it was in conjunction with them. That was their, that was part of their feedback. And I ultimately could have picked a different assumption if I felt it was more appropriate. So as an actuarial, you can rely on, on a data which you reasonably believe to be accurate. Yes. And you should. There was some discussion which I tried to follow but I didn't totally follow it. I think you will, you were explaining it. So I think you can explain it better than I can articulate it. But my basic question is, are you sure that the amount that you are assuming that the vaccine will cost is something that MVP will pay for rather than the government? Can you restate that question? I want to make sure I answer it properly. It's a bad question. You say, let's look at line 14. You say that your projections based on 52% utilization, 1.4 shots per member. And is that a dollar four per shot or 104 bucks per shot? 104. Okay. And so, yeah, so my question is, are you sure that MVP will be paying that 104 rather than the government or some combination of the government and some other entity? I cannot say with 100% certainty, but it is my job to make the best estimates of the cost. And we are very confident that MVP will be picking it up, but I don't want to sit here and say 100% and then it not happen. Okay. So that's what you were talking about when you said you had an expectation that based on something the government had already done, that the carriers would be picking it up, right? That's correct. Okay. And you talked about 52% utilization and you agree that 52% is based on a Medicare population, right? I don't know that for sure. I don't know the data set, but I would assume so, yes. I mean, it's CMS data, correct? Correct. Okay. And you also agree that Medicare people, people who are 65 or older, they're more concerned with young people like you. They're more concerned than you would be about getting all their shots, correct? On average, I would say that's appropriate. Okay. But you think because Vermonters are better at this. Vermonters have a better vaccination rate. It's sort of a wash and it makes sense then to use the 52% that is in the CMS data. Correct. We believe that that was the most appropriate estimation based on the fact that I believe Vermont is number one in the country in terms of vaccination rates. So I don't anticipate there, if 95% of people are willing to get the vaccine, I don't think that they're going to just quickly drop off. I agree with you about Vermont. And I did have a follow-up question about the growth in MVP's business. And the follow-up question is this. It's correct, isn't it? It has MVP expands its business. It needs more surplus to support that business, right? That's generally correct, yes. And if we, yes. Okay. And therefore all else equal as MVP expands its business, if nothing else changes, MVP's RBC ratio would go down, right? Yes. Okay. All else equal, yes. Right. Okay. And then conversely, if, maybe it's not conversely, but another effect of MVP expanding its business is, isn't it, that its administrative costs can be spread over a larger base and therefore the administrative cost per member would go down, right? To the extent that there are fixed costs, yes. To the extent that we have variable costs, no. Okay. So could you turn then, and this is the last group of questions I've got on this, this exhibit to the second to last page where you list the admin costs each year since 2016. Yes. Okay. So you've said correctly, I've got no reason to doubt it, that MVP has expanded its business from 17% of the market to 50% of the market since 2017. But the individual admin costs have gone up from $38.54 to $51.71 during that time. To me, that doesn't make sense. Could you explain why that is? Sure. I think there's a couple of things at play here. The 2021 numbers are significantly higher than the numbers in previous years. And I believe we talked the board through that last year and that was ultimately approved in our rates due to additional investments MVP has been making in the state of Vermont. And that was the reason for that. Now prior to that, I would say that there wasn't much movement from 2017 to 18, 19, or 20. And, you know, other factors such as when you're only a small percent of the market, there's less things that you have to do that cost money in that market. So as MVP ramped up membership, it had to continue making investments which cost money. Also, you would naturally expect there to be some offsetting impact in salary increases and just general cost inflation over time, not speaking specifically to the cost inflation we're undergoing now, but just annual inflation of costs on a normal year. Okay. So you mentioned investments that MVP had made in Vermont. What were those investments? Yeah, I believe that some of this is confidential, but I'll just say in general that we've made investments to enhance member experience and also a lot of investments around the UVM partnership, which I can't go into more detail than that here. Okay. And I won't ask you more detail about that except that I will ask you, are all those investments focused solely on the individual and small group business? They are not, and nor are the costs. The costs are allocated out appropriately. Okay. So what other types of business do those investments benefit? It benefits the Medicare Advantage population in Vermont, which is the current focus or the current, you know, currently we have a co-branded product with UVM as part of our partnership for Medicare Advantage as well as large group. Now, large group is a much smaller market than small group. We have about 2,000 members. So it's not as big of a population, but the costs are spread out by membership. Okay. And do you have any idea of how, of what percentage is allocated to the individual and small group business and what percentage to other businesses? I don't. That would be something that came from our financial planning and analysis team. Okay. Could you turn to your rate file and to exhibit one 40 to 149. Just, and on the very last page there, there's a reference to a surcharge levied by the state of Massachusetts. Could you explain what that is and explain why Vermont should be paying for it? Yeah. So this surcharge is essentially when a Vermonter uses a Massachusetts facility, there's a surcharge levied on that claim. And we are not, we are only adding the value at which the Vermonters have used Massachusetts facilities. This is not, it's the same thing for New Yorkers going to Vermont or going to Massachusetts facilities. And it's similar to if a Vermonter goes to a New York facility, there's something called Hickra that is added to it, which is a very similar type of surcharge. It's just like a little tax that the state charges on using the facilities in that area. Okay. Could you go to the last page of that exhibit one, which is page 154 under your actuarial certification description? Okay. Okay. You see the second to last paragraph, you say that the, that the proposed premiums may not be reasonable if their changes to the enforcement of the individual mandate or changes to the rules around selling across state lines or association groups. You see that? Yes. Okay. So if such changes were made, the rates would be inadequate, right? I, or they could be excessive. I don't know. It depends what, it depends what regulation is changed and what it does. If they pass something that reduced healthcare costs by 50% tomorrow, our rates would be excessive. Correct. So for example, if Congress did more than talk about reducing prescription drug costs and actually pass legislation that would do it, that would, that would have, that would reduce your rates. Correct. If they did that, we would be more than happy to pass any reduction through. Okay. Could you turn please to exhibit 17 and I just have one question that I want to ask on the second page. Okay. So on the bottom of the second page there, you described, I'm sorry, the questioner describes various cost containment initiatives, right? And then, and then you, you actually estimated dollar cost for the savings accrued based by each of those costs containment initiatives, right? That's correct. Okay. So as a percentage of premium, what, what effect would it, can you, can you translate those dollar amounts into a percentage of premium or are they de minimis? That is, are they so small that it really doesn't affect the premium? I mean, I think, I think it's, it's not negligible. MVP, I don't know the exact number, but I would say right now our proposed premiums are somewhere between 270 and 300 million for Vermont is, is the number I would say. Don't quote me on that, but it's in that ballpark. So if you, if you look at the, the pharmacy initiatives that are reducing between the two markets, roughly 800, a little over 800,000, I mean, that's a decent, you know, that's like a quarter of a percent, third of a percent. I mean, it's not, it's not a ton, but it's, it's not negligible. Exactly the, you exactly answered the question. Could you turn to the L and E report and this will be the last document I'll ask you about exhibit 12 and go to page 15. Mr. Carnady and you had a little discussion about some of the data there. Yes. Okay. And I remember you, you testified, didn't you that Vermont, that MVP lost about 30, 30 million on its Vermont individual and small group business this year? On our, on our annual financial statements. Yes. Okay. Was it not that it makes a big difference, but was it 30 million or was it 96% of 30 million? It was, it was 30 million in Vermont and 32 million in total. Okay. But last year though, you remember, don't you that on New York business, you lost 42 million bucks and you made money in Vermont, right? That is correct. Yeah. Okay. So it's not the cases that Vermont, that, that, that Vermont, the MVP has been burdened by Vermont year after year. Correct. MVP has lost money in Vermont on average over the past several years, but I, I wouldn't say it not to the extent that 2021, that's correct. And it made money last year. I mean, it made money in 2020, right? Correct. On Vermont business. Okay. Can you look at the table showing the decline in RBC ratio on page 15 from 433 to in 2019 to 354 in 2021? Yes. Okay. You're not saying are you that, that, that, that, that, that whole decline is due to losing 30 million on, on the Vermont individual and small group business in 2021? I am not. That, that is a very big decline and I'm not saying that that's solely attributable. What I, the point I was trying to make is our change in surplus impacted by our profit was 32 million of which the 96% came from Vermont. So my point was it can and does impact RBC. I, I am not making the statement that it's the sole contributor of the call it 55, you know, 55 or 75% decrease. A point taken, right? So yeah, there's a 75 point decline in RBC between 2020 and 2021. And do you know what is responsible for that decline? Nope. It could, it could be several factors such as obviously lower capital. So that of, of our losses, that's one. We did have continual as to your point earlier at if you grow membership, your RBC without new capital will go down. We have grown in the Medicaid market in New York pretty consistently across 2021. Every month we were adding members due to the federal government or the state turned off recertifications. So members didn't have to prove they're eligible anymore. They could just stay on Medicaid. So we did gain members month over month without a new capital infusion would result in a slightly lower RBC. So there's several things adding into that. I don't, I can't give you a percentage of how much each one is impacting it. Are you guys MVP in the Medicare Advantage business? Yes. Okay. And do you know whether your Medicare Advantage business was responsible for any of the 75 point decline? I do not. I do not think I will state that we were not highly profitable or unprofitable in Medicare Advantage in 2021. To the extent that Vermont was Vermont was our biggest loser across the board. In 2021. Yes. But in 2020, New York was a much bigger loser, right? Correct. Well, New York. Yes, driven by largely two of our markets where I believe Matt Lombardo alluded to anti-selective issues going on, which we have since corrected. Oh, you stated earlier, you correct me if I'm wrong. I wrote this down. I think you made the statement. Trend goes up every year. Do you, do you recall making that statement? And if you did, do you stand by that statement? Medical trend, meaning the cost of a given service in one year to the next in my five years and all the years I've heard about before increases. Now I should, I should say that costs don't necessarily go up. Like COVID, for example, reduced costs and costs went down in 2020. That does happen. But if I were to go for an MRI in 19 and an MRI in 20, the 20 MRI on average would be more expensive. They're just less of them that happened. Would it surprise you to know that in the 1990s, when the Clinton health plan was being considered that trend was negative in many markets? I don't have any reason to believe what you're saying is false. I would love for that to be the case. I have no more questions. Thank you very much. Mr. Pontiff. Thank you. Ms. Milliville, do you have any questions for Mr. Pontiff before we turn it over to the board? I do. Just a few. Good morning. Good morning. I wanted, I wanted to go back to, I'm hearing an echo. So I'm going to show my door. Sorry. That'll be better. I'm going back to the COVID vaccine testimony you gave. You stated earlier that insurance companies, including MVP have been responsible for the administrative cost of the COVID vaccine. Is that correct? That's correct. Great. I guess I should, I should say for the ones we've been billed for, there has been several that have been administered, lots that have been administered that we just have not been billed for. So did MVP pay administrative fees for its members that were vaccinated at the mass vaccination sites? We did not receive a bill. We have not paid anything. So I'm just thinking of my own experience when I went for a vaccine at a mass vaccination site. I did present my insurance card. Did you, were you billed for any of the mass vaccination site vaccines when insurance information was given? We were not. And anecdotally, I had that same experience when in New York, when we went, I did present my insurance card. It was part of the requirement. And then I believe there was a time period where they determined, like there were FEMA funds set aside to pay for some of it. And then they couldn't, they couldn't figure out how to bill it. Did they just send a, you know, an invoice for all the things because they don't have claims systems. And it ended up being MVP has not received a bill and does not expect to receive a bill for any mass vaccination sites. And consequently, that's how we get to our 37%. We don't, we don't have a record. So I don't, I wouldn't even know if, if you were an MVP member, if you were vaccinated via mass vaccination or just not vaccinated. All right. Well, thank you very much. No more questions. Thank you. Now we'll turn it over to the board for questions starting with board member lunch. Thank you. Hi, Mr. Ponte. Nice to meet you. Yeah, it's good to meet you too. I want to ask you some questions about 2021 experience. Did you do any comparison of the 2021 experience to, for example, 2019 or earlier years in general? In general, yes. Yes, we did. And could you tell me how it compared to, for example, 2019? Yeah. So what we've seen is a sharp increase in utilization and it's, it's general, like our, our unit, it's utilization and I should say intensity. So there's, we generally see three components. We like to think about medical costs and three components, utilization trend, medical trend, unit cost trend, I should say, which is just the cost of a given service and intensity utilization compared. So 2020, we all know utilization went down. In 2021, it came back up, but it's come up at a rate that if you do a two year utilization, annualized trend 21 over 19 still gives you a number that is a number we haven't seen before. So it's, it's a, it's a comeback and then continue to go up situation. Also the unit costs to look fine. So, you know, what the board has approved at the hospitals, we've checked that, that's all in line. There's nothing happening there, but a lot of what we're seeing is intensity. So something like a, an ER visit, for example, if, if we had 10% of our ER visits were level three in 2019, now it may be 15 or level three. And it keeps that ratio up. So we have more of in, we have increased utilization at increased intensity, kind of procedures or services, which that's how you get, that's how we're arriving at these huge claim costs. So it's, it's kind of two-fold and it's, it's difficult, it's difficult to control intensity. That's one, you know, a lot of it is controlled by the provider. And we are trying, you know, I can give you some information that we're trying to put, especially surrounding ER, specifically policies in place to better require proof for, okay, if you need to go ER level five, which we assume is like, you know, you might not make it almost, you better have proof for that because that reimburses at $1,500 where a three is $500. So that's a big difference. So could you just speak a little bit more to the policy changes you're anticipating that might help curb some of that intensity issue? Understanding that's difficult to do. Correct. Yeah. So we're just analyzing what I would call provider coding. So, you know, in, in a lot of these services are not, it's not sure, okay, I, you know, I have sepsis, I'm in a hospital for three months and I have a million dollar claim. Those are going to happen. They're going to continue to happen and they cost generally what they cost. It's more like we had 12,000 ER visits last year that all cost incrementally some value. And it's very hard to review every single one of them. Sure. And so we're trying to put policies in place where we can use, you know, use data to autonomously give some sort of either immediate down coding. So they would, if they give it, if they do a four, a level four, but it doesn't justify the criteria in our policy, it would get automatically paid as a three, something like that. So we're trying to review and we're still, I would say we're still in the stages of working through the different areas that these are happening in and trying to create and implement these policies. We have to vet them and it obviously varies by facility as you probably know, some facilities are percent of charges reimbursement. Some are paid on procedure code. So if it's percent of charges, it may not even matter. Right. So how do you alter that? And how do you, so we're working through all that. I would say we're in like the first third of it, we're really trying to make a push to implement new policies to curb what I would call, I don't want to say it's unnecessary intensity because that pushes blame to somebody, but it's just to make sure that it's legitimate. Thank you. Are you aware that there is a cyber attack in late 2020 at UVMMC? I was, yes, or I am, yes. Did you do any analysis to potentially isolate the impact of deferred care from 2020 that happened in 2021 as a result of that cyber attack? We didn't do anything specifically on UVMMC, but I can say that we looked at claim seasonality, you could say, and did not see a huge ramp up that would warrant an adjustment, but we did not look at UVMMC specifically around that time period. Yep. Okay. All right, thank you. I do have some questions on confidential materials that I will hold until for an executive session just to alert our hearing officer. And I did have a couple other questions since we're getting to know you. So do you work on New York filings as well or just Vermont filings? I do work on New York. I've worked on New York large group for the past couple of years in a management role. And in this year, early January 2022, I was shifted into my current role, which is now all of New York filings, including the small and individual markets, which I did prepare this year. But prior to this year, I was not involved in the preparation of those small individual rate filings in New York. Thank you. And I think that's actually all the questions I have that are related to confidential materials. So thank you very much, Mr. Pondin. Thank you. All right. Board Member Walsh, do you have questions? Mr. Pondtiff? Did you say Board Member Walsh? We did, yes. Yes, thank you. Hello, Mr. Pondtiff. Nice to meet you. Yes, you too. I'd like to go back to the COVID discussion if we could for a moment. Did you model a range of infection rates across the population? Infection rates, no. Everything we modeled was around data we had on claims, because it's very hard for us with our data to know anything about infections outside of, you know, publicly available documentation, which may not help us that much. Yeah. Yeah, it's difficult to model for sure. I tried to do some just back of the envelope things while we were in that part of the testimony, because I understood that your expenses could go up $60 over the 40 that have just been administrative. That's what I understood from that part of the testimony. So if everybody in Vermont, there's 650,000 people in Vermont, if every single one got vaccinated, that'd be $39 million. But not all of that vaccine is going to prevent some hospitalizations. So about 60% with the latest variant, about 60% of a population gets infected. The vaccines, according to recent research through JAMA and others, prevent about 56% of hospitalizations. So to recoup the $39 million, you'd have to prevent 200 hospitalizations if the average hospitalization is $200,000, which is also something from JAMA. So out of that size of a population, it would say that the prevented hospitals would be a savings to what you would have to pay out without the vaccines. So I point that out just because there was a long discussion about how having to pay for the vaccines could increase your expenses, the company expenses, but it would actually save in the long run. I'd like to turn next to affordability. In the affordability discussion, I had hoped to ask how you assessed affordability and get some more detail about it. But you said at one point while you were summing it up that you felt that the rate increases were affordable because it's a good balance between the costs of the service and the products and the benefits. And I just want to point out on record and listen, that's not a great way to assess affordability. I'd like to think of affordability like I think about jeeps. I drive a 10-year-old jeep. I'd love a new one. I'd like an electric one. And it may be that the cost of the supplies and the labor to make an electric jeep versus what I get from driving it, there could be a good balance between those. But I can't afford the jeep. The cost of that is too big a percentage of my income. And we don't have good assessments of affordability for Vermonters with the rate increases that we're looking at. The best estimates we do come from the Vermont Health Insurance Survey, which was argued at the beginning of the day that it should not be included. So I hope that it is. And I hope that we can have more discussion about affordability. We don't have good measures this year. We're not going to be able to fix it. We're not going to be able to have those discussions this year. But we need a better measure, probably multiple measures of affordability. We've got over 70 pages of public comments about people telling us they won't be able to afford these increases. And they will either become uninsured or not go to the doctor. That brings me back to the same thing with COVID vaccines. Seeing your primary care doctor regularly helps prevent bad things from happening later. People not taking their medicines or not going to the doctor to see less expensive providers often lead to greater sicknesses later. I hope we get those things into our models in the coming years. Thank you. Okay. Board Member Holmes, do you have questions for Mr. Pontiff? I do. Thank you very much. And thank you, Mr. Pontiff. Welcome to the Greenhaughton Care Board. I appreciate your testimony so far. It's very clear. But I do have some questions for you. As we know and you've alluded to or even been very clear on, this is a pretty unprecedented year in terms of expected increases in pharmaceutical drug prices, hospital rates, clearly monthly insurance premiums. My question to you is, is it possible, even likely, that people facing these higher premium rates may drop metal levels thereby facing greater cost sharing and utilize less? I would say that is certainly possible. And for some likely, yes, buy down is certainly something that is perpetuated by the continued increase in healthcare costs where, yes, people have to get lower benefits to keep their same premium level. And even within a metal level, isn't it possible, probably likely, that patients may utilize less as they face higher out-of-pocket costs due to these higher medical prices? Yes. And it's difficult because it's two-fold on that one. That's like the intention of a high deductible plan is to make people take some of the costs into their own hands so there's not overutilization. But for the people who don't have high incomes or are just low income in general, it puts that pressure on them where you feel like you can't go because you don't want to pay for the care you need because you can't afford it. I appreciate that. So it's two-fold because the high deductibles are meant to do good, but they can do inadvertent bad to certain subsets of the population. Yes. Yeah. So in exhibit 35, if you could turn to that on page two, I guess my question to you is based on your testimony so far, why does your utilization assumption stay the same before and after the updated hospital budget information is incorporated? As you just said, these are historically large increases in unit costs that are probably going to have an impact on people's decisions about whether to seek care, when to seek care, how much care to seek. If you look at the outpatient alone, it's going from a 5% increase in those unit costs to an almost 14% increase in unit costs after the hospital budget submissions were considered, but you didn't change your utilization assumption at all. Can you talk to us about that? Yes. Well, I would first say that I believe the ask was just to quantify the proposed hospital budget, so we did not consider that. And secondly, I would say it's a valid thing to consider. This year, I think we are stuck in that difficult position where our utilization data as I spoke to Jay about is just, it's not credible. So we would have to rely on, and it's reasonable to rely on a external independent source of is there a study between that links buy down to lower utilization rates and assuming that that is well founded, it's a reasonable assumption that could be made. We did not do it because historically this exhibit is meant to quantify the hospital budget themselves, not an update to our rating methodology. Okay. Well, I guess my request then that we can add, sometimes there is a post hearing follow up would be for you to consider the impact of these unprecedented prices on your utilization assumptions factoring in buy down and factoring in price elasticity of demand, people's responsiveness to these rather large historical rate increases on utilization. Of course. Yeah. Thank you. I appreciate that. For the past five years, how have your actual admin costs compared to your projected admin costs at the time of filing? And if I missed that in the submitted materials, I guess I would say that is fine to follow up in a post hearing data as well. I've missed it. Yeah. I don't think you did miss it. I know it's an exhibit. It's not an exit. I shouldn't say exhibit. It's a document that we have together somewhere. So it's very easy to put together for you, but it's not in evidence here. So I don't want to speculate on it, but we can certainly follow up. Great. Thank you so much. On exhibit 16, page 13. You state at the, I guess it's the second full paragraph. The first sentence there. MVP has various online cost transparency tools for our members to help steered members towards affordable and quality care. I'm curious if you could address what metrics are displayed on that online tool to indicate level of quality for a facility or a provider. How are we steering members specifically towards quality care in that cost transparency tool? Sure. I in, I don't want to miss the abuse award here, but in full transparency, I personally have not used this tool to seek my own care. So I, I am not sure the quality metrics, whether it's, it's a, we have a, we have a high performing network of providers that we have graded based on. We have ETG methodology where we rank provide, where we look at episodes of care. So such as you had a, you know, a, a transplant or something like a risk surgery, right? And it looks at all risk surgeries across all providers in their costs for the whole episode, not just the surgery, but how many post-op visits do they drag you into? How many, you know, pre-op visits that they make you do where they get you for 250 bucks a visit, right? Like how much of that happens? What's the cost of the episode? And then we kind of rank percentile. This is a high performing, you know, a high, when I say performing provider, it's, it's providing the quality services at the lower costs. So the quality metrics in total, like what we're actually using as metrics, I, I don't have the exact data on that. And, and I can give you, this was our marketing team. And they, they work very closely with this and trying to educate on it. I just don't have the exact figures for what the quality is. And I'm happy to give that to you, but I know that that's, that's the outline of it. Yeah. If you could follow up with what a member in Vermont sees on that cost transparency tool related to quality, that would be really helpful. As a, as a follow-up to that, actually, I did go on the MVP website and poke around a bit. And one of the things on the website it says is MVP has established the MVP provider excellence program. Perhaps that's what you were referring to. Yes. To provide our physicians and members relevant quality and cost data to help them make informed healthcare decisions. The purpose of this new program is to identify and recognize high quality cost efficient providers. But unfortunately, the next line down on the website is this is only available for in network participating providers that are contracted with MVP in New York state. Those are the only providers that are actually evaluated under that program. So unless I'm missing something, no Vermont providers are included in that program. So why, or if I'm correct in that, and I apologize if I'm incorrect in that, but that is what the website says, only providers that are contracted in New York state with MVP in New York state are evaluated. Why are you not providing the same evaluation of Vermont providers? Totally valid question. I don't think you are mistaken. If that's what the website says, I, now what I will say is that's great feedback and I did not know, I did not know that the website said that. I would, I believe that program is used on some New York large group plans where we have things that if you go to one of those providers, you may be able to get a differentiated cost share than like you may get a $30 copay and set up a $50 copay if you go to a high quality, high cost or low cost, sorry, provider. I don't think that's, we can't do that. I don't think in the ACA market have like tiered, tiered benefits or we don't. So I don't know what, what I will follow up and get clarification is I don't know if the Vermont providers are not evaluated at all or if they are not part of the program because it's, it's meant to adjudicate benefits for the New York benefit plans. That is clarification I can provide, but either way I agree and it's perfect feedback. I will provide that we should, we should be doing it for MVP's full service area. There's no reason we should. And then can you confirm that none of the administrative costs of designing or mounting that provider excellence program are allocated to Vermont members right now? I cannot confirm that. That's done by our, our allocations are done by our financial planning and analysis team. Okay. So be helpful to just can with your financial analysis team could confirm that because if the Vermont members are not getting the benefit of that, they shouldn't be paying for that program. Certainly. Are there any other general services marketed on your website that are provided to New York members only not to Vermont members that you can think of? Not that I'm aware of. I know we have, we have our GIA, which is our, our app, our mobile app, which where you can get for all non qualified for all non high deductibles. You can get first dollar telemedicine care 24 seven, you know, psychiatry, urgent care, PCP kind of intervention, all that stuff. First dollar. That's available to the whole MVP service area in 2023. We're rolling out a, a virtual PCP through it, through a new vendor. And that will be available to all of MVP service area. I don't know of any other specific programs that are just New York only. Okay. Do you think so if you can just confirm that in your follow-up that there's nothing else that's, that's a general service that seems to be marketed to MVP members that is not directly also available for Vermont members? Would you agree that MVP could improve costs and increase the quality of care for the monitors by taking a more active role in helping Vermont members steer towards higher quality low cost providers? I think in general that is true. And that is the, the goal. Yes. Promoting pushing members into, I shouldn't say pushing, you know, shifting members into low cost, high quality care is the goal, should be the goal of every insurer and is, is a key step to reducing healthcare costs. Yes, I agree. In exhibit 17, page three, in response to question four, about several of the cost initiatives, and you've spoken a little bit about this with Mr. Angoth, but you did state there that there were two to $300,000 of expected cost savings from the coding and implant initiatives that were not reflected in the filings. Are there, you know, I guess it would be helpful. I understand it might not be a lot, but what would that premium impact be? And more importantly, are there any other cost savings initiatives that the actuarial team learned about after the file was submitted in the same way that these two cost initiatives were identified, post filing from, from your management team? Yes. So, so I'll, I'll answer the first, the first part first is the roughly 200,000 I think would translate to somewhere between a tenth, 75 basis points and a tenth of a percent, you know, on the rate for both markets, maybe split a little bit differently. It's, it's again, it's not nothing, right? 200,000 is 200,000, that's a lot of money. And yes, we did check with our, when this came up, I will be honest with you, when this came up, the actuarial team was like, hey, why weren't we told about this? Right? Like this, this is our job to price the plans. We, you know, keep us in the loop. And so we did at that point check with them. Is there anything else we need to inform the board about or go, go about adjusting our rates for? The answer was no, there's nothing, there's no other estimated savings at that, at that time. Obviously, as we put in our answer, we continue to, we're constantly, you know, I say we as MVP are constantly evaluating those things and, and trying to come up with cost savings anywhere we can. But these, what, what we've talked about here are the ones that we have, you know, estimates for and are, are, you know, ready to reduce the rates for. So yes, and I am in agreement that the 200,000, we were not informed about until after our submission of the rate filing and is a gap. Great. Well, I very much appreciate all your answers to questions and I will really appreciate the follow-up that you've agreed to do on those questions that you were unable to answer today. Thank you so much. Yes, thank you. Board Member Pelham, do you have questions? I do. Good afternoon. Oh, it's still morning. Good, good morning, Chris. Chris or Christopher? Chris is good. Very good. So my first question is just to kind of walk from where we started to where we are now. We started with the original filing. You know, as was noted today with the small group, up 16.6% and the individual up 17.37%. And we've now migrated to 24.78% and 24.54% respectively. So I'm just trying to get a sense of the dollar value of that, not just the percentage or the per member per month, but so it's a fair calculation that in your surf filings with the original, the original surf filings, you were saying, well, you stated that the premium increase would be $24 million for the small group and $21 million in change for the individual. So what would be a fair mathematical exercise to, for example, divide the small group current 24.78 by the 16.6 and multiply that by the premium increase originally submitted to get a sense of how much aligning ourselves with the hospital budgets is being passed to premium payers. Yes, I think that's a reasonable approximation. Okay, so if you do that, your original submission was over, over on a combined basis was $45 million. And now we're about $20 million higher at $65 million. That's where that math takes us, which is, you know, some big numbers. So where we are now, the rates that we're looking at now are rates that are based on the hospital budget submissions. That's correct. What they've requested in terms of commercial payments or commercial revenues. Correct. I believe for all hospitals outside of the UVM network, they just provided the one number to the increase to the charges UVM made a specific distinction that their commercial rate increase would go up more than the charges. And so we've reflected that figure. But yes. Okay. So we might have a little difference here. I had a much more simple approach. I got inspired yesterday to go and look at all the hospital budgets on file at the Green Mountain Care Board and to go to the payer mix table, which is for reference, and I'll send you the spreadsheet. It's a page four or seven of the hospital submissions. And there there's a breakdown of revenues by payer by Medicaid by commercial. And it ties out to the net present revenue. So it ties out to the dollar. All of this kind of sits, it's, you know, all the bad debt and all that stuff is washed away. And these are the actual revenues that. And so I was looking at that. And I created a spreadsheet for all of 14 hospitals. And the total amount for 23 budget, which would include your increases here, was 1.859 billion. And that was a 20.1% increase over 2022 projected. The most recent number we have. And so the net change, the change, the dollar change is 318 million dollars across all hospitals collectively of that 223 million 223.7 million is aligned with the UVM medical center budget, which is 70% of the total. And for the network, it's 251.8 million. So it's 79% of the total. And so a couple of questions in that arena. Given the scale. It seems to me looking at these numbers, one of the reasons why we're here is, is UVM medical center and the network that absent, you know, those increases. We wouldn't be in a severe opposition. And I'm just wondering if, um, um, if, if, if two things, I'm wondering how that might affect how this, how the revenues that you're receiving from these premium increases get, um, uh, um, uh, uh, spent basically through the fee for service system, because it's a fee for service system out there that's going to kind of draw this money, you know, um, from you to, to other providers. And, um, you know, does how, how do small hospitals or independent providers, you know, get treated when there's this, you know, one big, one big entity that is, is, uh, and a powerful entity. Uh, that's kind of, that's kind of driving the reason why we're here and facing these increases. Yes, that, that is a certainly reasonable question. I can't say I'm familiar with the, the financials of, of UVM or the, the math behind their proposal. But what I can say is that UVM is as, you know, I don't want to say exact numbers because I don't have it. It's, I believe it's in a confidential exhibit, but UVM is a percentage of our outpatient or inpatient hospitals that we spend is large, right? So I think it does, it's factual to say, impacting them by a percent is not the same impact on rates as impacting a smaller hospital by a percent, right? It's, if you impact all hospitals by a percent, it's uniform to everybody, but it may impact a certain hospitals differently. So it, it very much does fluctuate and UVM is our big, you know, the, the main reason for our rates going up so is I believe they had the highest increase at 19.9 for a commercial rate increase, which we then pass, you know, pass through as a big portion of our claims. So yes, I, I don't, I can't comment or, you know, speculate on what should be done. But I do know, I am agreeing with you that they are a large portion and what is done to them is not necessarily indicative of, you know, what is done to what should be done to other hospitals or vice versa. And it does impact rates differently. Well, I'm just, I'm just worried about it a little bit. I don't know what to do about it, but yeah, anyhow, but I, you know, it is a UVM medical center is a 27% increase over their 2022 projected. And it's, it's a big number, 223 million dollars. So I just, I just worry about kind of the smaller fish in Vermont Sea kind of getting pushed aside a little bit, not because purposefully, but just, just by the scale of stuff here. So here's a hypothetical. What happens if, as we go through the hospital budget process and, you know, it just gets too difficult to swallow these increases. I mean, as the other Tom said, we've gotten pages and pages and pages, you know, of comments this year. You can't walk away from the fact that a 24%, 25% increase in premium is small or reasonable or moderate. I mean, it's a big heavy lift. And so one of the things I was looking at in terms of the UVM budget is that for their 22, a projected operating margin, both operating margin and non-operating margin combined, and you can see it on their balance sheet and on their income statement, they're in the whole 130 million dollars projected for 2022. And they move to 2023 to a 56 million dollar combined margin surplus. So they go from a negative 7.9% margin to a positive 2.8% margin. And what if we say, well, gee, this just seems to be too rushed, too crammed. We definitely have to help UVM Medical Center get out of a hole they're in. But we can do it over, say, two years or three years, you know, and which would give more time for the reforms they might be pursuing to take hold and save money. It might give ratepayers a more manageable, you know, kind of payment obligation. And I'm just wondering how all this relates, because if we approve your rates, and then we go through the hospital budget process, and, you know, we exercise a little bit of, I mean, I can go back in my experience in the early 90s, and it took us four or five years to work out of the recession and prior governors, you know, leftover fiscal issues. And I'm looking at this and thinking, well, maybe this isn't something that can be solved in a year, can reasonably solved in a year. And we might need to structure our processes so that it happens over a two or three year period. Does that, what's your gut reaction to that idea? Yeah, well, I guess I will say I don't want to, I don't want to speculate on, again, what the board should be doing to any given facility. But what I will say is that MVP does believe that at the end of the day, we just want our rates to, our premium rates to reflect the expectation and or the approved hospital budgets. I know that's part of the difficulty of this timing every year, is the budgets aren't known until after. I don't know the laws. I'm not a lawyer. I don't know any of those things about like, if you decide that after the fact, is there a retroactive true up or can you, is that even permissible via the board? I don't know. What I do know in hope is just that MVP, just wants the rates to match the budget. So if, if you approve fully UVMC, we would want that reflected. If you give them nothing and say figure it out, we would want that reflected. So it doesn't, we're, we, we are all for lower healthcare costs in, in the system and in making the member experience better and trying to reduce premiums for the members. But our first goal, our goal first and foremost is to protect solvency as a company. And that would be done through just making sure the hospital budgets are aligned with the premium rates, whatever they end up being. Well, that's, I mean, one, one thought, and maybe this is, is, is not a good thought. But one thought is that I've watched this debate for the last couple of years between your competitor and UVM about fixed perspective payments. And one of the party says, we don't have any willing partners. And the other, and the other says, I'd be, they'd be first in line, you know, for fixed perspective payment. That's not something that can be done in a year. It might take, you know, if all of a sudden that log jam gets broken, it might take a year or two years or so. And, but would not be factored into, into the kind of current decision making. Another area that when I was putting together the spreadsheet, I did kind of keep the Medicaid totals to just to see the comparison. And so for 2023 budget year over 2022 projected year, the actual Medicaid number went down across all hospitals, i.e. hospital financed people don't expect anything more. In fact, they expect less than what they received by 2%. So it's a negative 2%. And if you go to the JFO's website and you look at their five year global commitment trend, it's a negative 0.4% trend over those five years. And so my question in this arena is, you know, how, how is MVP engaged in any effort to have the Medicaid program keep pace at least with some modest inflation rate as, but certainly isn't isn't in the negative arena. Yeah, so I can't speak exactly to provider by provider contracting in terms of Medicaid rates. I know that the Medicaid fee schedule is something that is set either is set by the government. I'm not sure if it's federal or if it's state, but it's a government set fee schedule. And I, I know those don't generally get the updates and it does result in a leveraged impact of commercial rate payers subsidizing Medicare and Medicaid. I always in a little like in my personal life, I always liken it to if you, if you go to the doctor and, you know, you see not accepting Medicaid patients are not accepting Medicare patients. People always ask me, like, why is that? Well, it could just be, you know, the reimbursement, the reimbursement could be drastically different, significantly different for Medicaid versus Medicare versus commercial and it results in, and I think the hospitals, most all the hospitals call it out in their budget. So it's no secret that in order for them to get back to a increase of call it 4%, commercial has to pay a leveraged impact to that, whether that's fair or not is obviously not my arena, but it is something where the government does not update or does not increase the government run programs fee schedules at the same rate that the hospitals want in total. And so it creates that subsidization. I am just giving me two seconds to look here. I think those are the kind of key questions I was concerned about. The sequencing of rate review first, hospital budget second is, is, is deeply problematic and I, I just wonder if there's some kind of like, given the scale of these rate increases, you know, and the magnitude of them, if there's something that we, you know, that we can structure that can flatten this out a little bit. So it's a little bit more manageable for everybody. And it gives our provider system time to, um, it gives them time to implement reforms that I doubt that they could implement in just a one year budget cycle. So thank you for your time and effort. And, uh, I'll pass you along to our esteemed chair. Thank you. Mr. Charity have questions. I do. Um, good morning. Mr. Ponna, if I, I'd like to say it's a pleasure to meet you, but I feel like we've met before. I did, uh, I stepped in for, I believe one question in the executive session last year that Matt did not have the, uh, did not have the answer to. So he, he tagged me in for that. So that you may remember me from there. Okay. Do your friends call you your holiness? No, no, I do get it every now and then, but no, no. Is, is Matt still with the company or is he gone? Yes. Matt, Matt transitioned over into our growth and innovation department. So he got out of the actuarial role and wanted to focus more on, um, expanding MVP as a company. Well, first of all, let me, uh, thank you, um, for MVP actually doing business in Vermont and providing, uh, for monitors with, I'll be at a limited choice, a choice in, in their, uh, um, decisions on where to, uh, buy their insurance. And, uh, on behalf of all Vermonters, thank you for that. And thank you for your, uh, candor this morning. I very much look forward to seeing that, uh, analysis on, uh, the elasticity and, uh, the price. There, there was a substantial difference in what was ultimately filed by hospitals in Vermont and what you originally, um, projected, um, use had mentioned that you're, um, overseeing the New York pricing as well. Have you seen that similar surprise in New York state or is this a Vermont phenomenon? So I, I think the important distinction is Vermont. Obviously the bulk, I don't know, 60, 70% of our dollars flow through Greenmount care board jurisdiction hospitals. So there's like a formal budget process and all of that. I can tell you that in New York, our trends are in, are just about what they have been every other year. So total medical plus pharmacy plus utilization is in the six to seven range, which is the same, you know, the same as Vermont has had historically. Um, so we, to my knowledge, we have not gotten or I, and I shouldn't say gotten, I should say gotten and or negotiated a hospital to have very large increases in New York. I could be wrong on that. I'm not a contracting expert. But are I, what I can tell you for sure is our rates do not reflect the sort of jump in expected facility costs that we're seeing come through the budgets in Vermont. That's true. So in your role overseeing pricing, um, are you just providing information to the negotiators with the hospitals or are you actively engaged in those negotiations? We, we provide. So it's, it's a little bit of a two way street. We provide them support in their data understanding of where our services utilized. And, you know, we, we serve as like, uh, there's, there's a couple of departments with an MVP that can serve as kind of data, um, data providers to the, to the network team, the network team specifically is who talks, who, who owns relationships with the hospitals and does the negotiating and, and figures out what the increases are going to be at when they then come back to actuarial and say, here's what we've negotiated. Here's what you should build into your rates. It can buy, you know, on a facility by facility or in, you know, in patient outpatient position basis. My colleagues have asked all the questions that I really had. So that, that's all that I had. I, I wasn't even sure if Gary would let me ask you the question I just asked without, uh, raising an objection, but I appreciate his allowing me to ask that. So thank you. I, I would never stand between the chair and a question. Okay. Mike, it's back to you. Um, and I think. So we need to get to potentially redirect and then, uh, it sounds like an executive session and I'm wondering, Gary, if you have any preference on taking a 30 minute lunch break now, um, or do you want to do your redirect and then take a lunch break and come back and do the executive session at the end of the break? Do you have any preference on how we, uh, well, I, I would prefer to do my redirect after the confidential session, just so then I can, if there's any redirect on the confidence, I can do it in that. And then we come out and I do any other redirect. I will say at this point, I have no redirect on the questions that have been asked so far. Um, and as to a lunch break, um, I'll defer to you and the chair on that. My bladder may not, but I'll defer to you on that. Mr. Chair, do you have a preference on going into executive session now or at the tail end of a lunch break? I think that, uh, it doesn't matter as long as it's, uh, tied to the lunch break so that the public doesn't have to, uh, um, try to guess when we might be coming back. I think it should be fairly quick. I didn't hear a lot of board members express that they had questions about confidential stuff. So. Well, Robin said she had several. So maybe we should just ask her how long she thinks she's going to need. I think I'll need probably more than like 10 or 15 minutes only have two or three questions. I think I have one or two. Okay. So. Okay. So why don't we, uh, take a five minute bio break. Reconvene around at noon. Uh, can plan for a. About a half an hour executive session prior to lunch. And then we'll. Turn to Gary for any. Potential redirect he may have. Um, so we'll go back on record in, uh, the. In the matter of MVP health plans 2023 individual and small group rate filing. Um, so. Board members, we went through this yesterday. Um. But I'll just kind of recap. Uh, we do hold these. Hearings as part of a, as part of a regular meeting. Or as part of an open meeting. Um. The open meetings law contains several different grounds that you can go into executive session. Uh, one of those grounds is to, um. To discuss, uh, material that's exempt from public inspection and disclosure under the public records act. Uh, all the material in the binders that's been marked as confidential has already been reviewed. Um. Uh, and found to be exempt under the public records act. So you can go into executive session to. Uh, ask questions about that material. Um, and, uh, we would need to. Prevent a discussion of that material from turning into a. Discussion of the general topics, um, to which they pertain. So it really needs to be limited to. Uh, what's been marked as confidential in the exhibit binders. Um. And that's really the only basis I heard. There may be questions around. Um. Any, any questions for me about. About that before I suggest a motion. No, but my just to be clear, my questions are around the confidential material, but it may get into provider contracting because it's related to. Those sections of the confidential materials. So. I think I should move under both grounds. Okay, that's good to know. Yeah. So the, the other ground, there's a. There's a. Ground for going into executive session to discuss contracts. Um, Provided that there's been a finding that. Uh, the information. Um, would cause a substantial disadvantage if, if made. Public, um, a substantial disadvantage to. Uh, you know, in this case. MVP. Um, so as long as the questioning is specific to competitively sensitive provider contract negotiations, typically that's like. What do we expect terms to be? You know, what are the issues that arise in, in those negotiations? The, how, how do those issues get resolved? Um, those types of things. Uh, fall within that. Exception. So. Um, I think the best way to go about it is to 1st. Um, make a finding that. Uh, public knowledge. About the details of MVP's provider contract negotiations. Uh, would place MVP at a substantial disadvantage in those negotiation negotiations. And then. Uh, the 2nd motion would be. Um, to go into executive session to take testimony about. Um, materials in the. Binders that's been marked as confidential as well as. Um, provider contracting. So would anyone like to move that the board. Find that. Uh, public knowledge of the details of MVP's provider contract negotiations would place MVP at a substantial disadvantage. I will move that the board find a public knowledge of the details of MVP's provider contract negotiations would place MVP at a substantial disadvantage. I'll second. It's been moved and seconded. All those in favor of the motion please move. Thank you. I'm not saying, I'm. Hi. Hi. Any opposed. Please let the record reflect that that was unanimous decision. And then the 2nd motion. Uh, would be. Would anyone like to move to go into executive session. To take testimony about. Materials in the binders that's been marked as confidential. Provider contract negotiations. I will so move. I will. Second. It's been moved and seconded. All those in favor of the motion, please signify by saying aye. Aye. Aye. Aye. Okay. Again, please let the record reflect that was the unanimous decision. Um. So. Uh, we, as you guys know, we have a separate. Call line for the executive session. Um, Mr Miller, is it possible to have. Uh, this. Transcribed separately from the public portion of the hearing. Yes, we can do that just like we did with yesterday's. Great. Thank you. So in terms of who needs to go. Uh, to the executive session, obviously the board members, the attorneys. Um, I think really. Anyone from. MVP healthcare advocate, the board board staff. Um. Yesterday we had DFR. Uh, on, I think that's. Gary, unless you feel differently, I think that's appropriate. Everybody keeps saying yesterday, but it didn't, it feels like it, but it was really Monday. That was going to be my question. Did you go for two days? It only felt like it. No objection. No objection. Okay. So DFR is welcome. And. I think that covers us. So. Uh, in terms of time expectations. Um. I figure we would go directly from the executive session to. Uh, the lunch break, and then reconvene the public. Session after that. So I'm thinking. Quarter after 1. Might be reasonable to return. Um, but we can update Christina. Maybe we can just. Kind of update the notice that we put on the public session here. We can do that. Great. So why don't we just put a quarter after 1 for now. And then update it as we need to. Anything else before we move over to the other line? I would appreciate it if you could just so we all go there properly. At least my team tells us what we're doing. Where we click. So click leave. On this meeting. Um. There was an invite to. So it's on my calendar. So my team's calendar. Just click join the confidential. The executive session 1. And that should do it.