Highlights from December ERS Board meeting recap

February 07, 2024

3-minute read

The Employees Retirement System of Texas (ERS) Board of Trustees and Investment Advisory Committee (IAC) met on Dec. 5 and 6. Brief recaps of key agenda items follow. You can find the full agenda and more information, including presentation slides, video recordings and links to meeting materials, on ERS’ December 2023 Board meeting webpage.

Actuarial valuations and financial status of retirement program: ERS’ Director of Government Relations and Special Projects Jennifer Chambers and representatives of Gabriel Roeder Smith & Company, ERS’ consulting actuary for retirement benefits, presented the annual actuarial valuation of assets and liabilities for the:

ERS Plan,
Law Enforcement and Custodial Officer Supplemental (LECOS) Retirement Fund and
Judicial Retirement System Plan 2 (JRS 2) Fund.

The presenters noted the Texas Legislature’s actions during the last two legislative sessions to ensure the actuarial soundness of all three pre-funded pension plans administered by ERS. Ongoing Legacy Payments (established in Senate Bill 321 in the 87th legislative session) will continue to reduce the unfunded liability in the ERS Retirement Plan. The 88th Legislature increased contributions and included lump-sum payments to fully fund LECOS and JRS 2 as of Aug. 31, 2023. The Legislature also created a cash balance defined benefit retirement structure for newly elected or appointed judges taking office on or after Sept. 1, 2024, to mitigate future unfunded liabilities for the JRS 2 plan.

View the FY23 pension actuarial valuation report and a summary of the report PDF.

HealthSelect of Texas^® medical plans management contract recommendation: ERS staff presented the recommendation to award the HealthSelect of Texas^® and Consumer Directed HealthSelect^SM medical plans contract to Blue Cross and Blue Shield of Texas (BCBSTX) for the provision of third-party administrative services under the Texas Employees Group Benefits Program (GBP). They noted that BCBSTX, the current administrator of the plans, was the only bidder for the contract after another company pulled their bid during the evaluation process. They also described ERS’ rigorous process for soliciting and evaluating proposals, including a thorough evaluation even after BCBSTX became the only bidder. Following discussion, the Board awarded the contract to BCBSTX and granted the ERS executive director authority to negotiate terms of the contract. The new six-year contract will take effect Sept. 1, 2024.

Group Benefits Advisory Committee updates: Bernie Hajovsky, director of ERS’ Enterprise Planning Office, and Janet Bezner, Ph.D., chair of the Group Benefits Advisory Committee (GBAC), reported on the committee’s 2023 activities, which included discussion of the following:

participant use of telemedicine since the onset of the COVID-19 pandemic,
coverage of weight loss and diabetes management medications,
updates on provider networks,
participant engagement in health and wellness opportunities and
the use of benefits materials to recruit and retain a qualified workforce.

The Board voted to fill vacant positions on the committee with the following appointments, effective Jan. 1, 2024. ERS staff recommended the appointments after a nomination period in fall 2023.

Dr. Ronald L. Cook, Texas Tech University Health Sciences Center
Joe Freeman, Office of Court Administration
Jan Graeber, retiree

Visit ERS’ Group Benefits Advisory Committee webpage to learn more.

The next joint meeting of the ERS Board and IAC is scheduled for March 20.