September 2017 Monthly Board Report

RETIREE HEALTH CARE CHANGE PERIOD BEGINS OCT. 1

The 2018 Annual Change Period runs from Oct. 1-31 and allows current participants in the OP&F health care plans to verify their personal information, apply for the health care discount, and enroll or waive dental and vision coverage. UnitedHealthcare sponsors presentations at six locations around the state to answer questions about the health care options available to members in 2018. The first meeting is in Akron on Oct. 3.

OP&F will continue to sponsor a group health care option for retirees in 2018. The transition to health care exchanges will be for the 2019 plan year.

PORTFOLIO UPDATE
OP&F's investment portfolio value:

Board of Trustees Committee Notes
(Motions approved by the Board are listed separately)

• DISABILITY: In addition to the regularly scheduled hearings and appeals, the Committee reviewed a list of benefit recipients who have not submitted an Annual Earnings Statement to date. If not submitted by Dec. 8, these members may have their benefits suspended. The Committee also heard a report from staff about the mandatory electronic direct deposit of benefits, which went into effect of Aug. 1. Currently, 84 members have not signed up for direct deposit with their financial institution.
• HEALTH CARE: The Committee received presentations from three firms on plans for assisting OP&F in its health care transition and their health care exchange models. The Board will seek additional information and input before discussing again at its October meeting.
• INVESTMENT: In addition to the monthly portfolio performance update, staff provided the Committee with the 2nd Quarter Private Markets Report and the 2nd Quarter Real Assets Report for review. The Committee learned that an approved change to the structure of the high yield class will result in an expected savings of more than $500,000 in investment manager fees.
• GOVERNMENT AFFAIRS AND POLICY: The Committee received a legislative update from Mr. Hewit and answered questions concerning proposed legislation.
  
  Motions:
  At its September 2017 meeting, the OP&F Board of Trustees voted on the following motions:
• Approved Wilshire’s recommended asset class rebalancing ranges to be applied to OP&F’s new long-term asset allocation policy and to the interim benchmark targets during the implementation period. Motion passed by unanimous vote (Investment Committee).
• Approved Wilshire’s recommended High Yield asset class structure. Motion passed by unanimous vote (Investment Committee).
• Approved Wilshire’s recommended benchmark for OP&F’s Private Credit asset class. Motion passed by unanimous vote (Investment Committee).
• Approved Staff’s recommended investment manager ratings for Bridgewater Global Macro, PENN Capital and MacKay Shields High Yield Active Core. Motion passed by unanimous vote (Investment Committee).
• Approved Staff’s recommended investment manager ratings for OP&F direct lending managers, MC Credit Partners, GSO Capital Partners, KKR Lending Partners II and Tennenbaum Enhanced Yield Fund I. Motion passed by unanimous vote (Investment Committee).
• Approved the Committee recommendations for the initial determination of disability for the members as identified in the initial determination hearings list presented to the Board on Sept 27, 2017. Motion passed by unanimous vote. (Disability Committee).
• Approved the Committee recommendations for appeal hearings for the members identified in the appeals list presented to the Board on Sept. 27, 2017. Motion passed by unanimous vote (Disability Committee).
• Approved the Committee recommendation for Death Fund benefits for the members identified. Motion passed by unanimous vote (Disability Committee).
• Waived the mandatory medical evaluation and filing of annual earnings statements for future years for the members identified in the disability reporting waivers list presented to the Board on Sept. 27, 2017. Motion passed by unanimous vote (Disability Committee).
• Approved that OP&F absorb any increase in AARP Medicare supplemental rates that may occur for the 2018 plan year. Motion passed by unanimous vote (Health Care Committee).
• Approved several items for Mr. Hewit to take to the legislature for consideration. Motion passed by unanimous vote (Governmental Affairs and Policy Committee).
• Approved a proposal to extend the maximum Deferred Retirement Option Plan participation period to 10 years for Mr. Hewit to take to the legislature for consideration. Motion passed by a vote of 8-1 (Governmental Affairs and Policy Committee).
• Approved the re-adoption of the OPERS Salary Reduction Pick-Up Plan. Motion passed by unanimous vote (Personnel Committee).
  

NEXT BOARD OF TRUSTEES MEETINGS: Oct. 24-25 , 2017