South Carolina Public Employee Benefit Authority

This strategic plan outlines the organization's direction from 2021 to 2025, focusing on five key goals. It aims to promote financially sound programs by controlling costs, optimizing benefits, and securing long-term viability through legislative engagement, best practices in health plan design, and efficient service delivery. The plan also prioritizes enhancing customer service, responsibly managing organizational risks through enterprise risk management, and maintaining a capable workforce with a conducive environment. A significant focus is placed on improving internal efficiencies through the implementation of new information systems and operational changes.

The Finance, Administration, Audit and Compliance (FAAC) Committee meeting was called to order, confirming compliance with the Freedom of Information Act. Key discussions included the presentation of internal audit reports concerning the Annual Conflict of Interest Certification, System and Organization Controls (SOC) Reports, Internal Audit Report No. 2025-02 related to the Adoption Assistance Program, and an update on the December 2025 Internal Audit Plan. The Executive Director reminded the Committee that the external auditor and external actuaries would present the 2025 Retirement Systems Actuarial Valuations at the full Board meeting.

The meeting commenced with the Chairman calling the PEBA Health Care Policy Committee meeting to order, confirming compliance with the Freedom of Information Act. Key discussion items included an open enrollment update, where details regarding changes for 2026 in health, dental, and vision plans were reviewed, along with enrollment statistics showing 85,349 total transactions and a 99.96 percent satisfaction rate for the Customer Contact Center calls. A value-based program update detailed the annual Health Initiatives and Value-Based Benefits report, which now incorporates HEDIS performance measures. Specific discussions covered chronic conditions such as diabetes and high blood pressure, behavioral health services, and prevention/early detection services. The report noted that total plan expenditures for medical and prescription claims reached $3.927 billion in 2024, with 3.0 percent allocated to value-based benefits and programs. The Director's Report was deferred to the full Board meeting.

The meeting included a review of the quarterly investment performance report for the Defined Contribution Plans. Market commentary noted that U.S. Large-Cap and Small-Cap stocks experienced significant gains in the third quarter, with international equities outperforming U.S. equities. Specific recommendations involved replacing the T. Rowe Price Growth Stock fund with the JP Morgan Large Cap Grown fund in the Deferred Compensation Program lineup. Furthermore, several funds in the State Optional Retirement Program (State ORP) lineups (Corebridge, Empower, and TIAA) were placed on a watch list for further review. A quarterly plan review for the Deferred Compensation Program included statistics on new enrollments, contributions, and distributions. A service overview for the State ORP administered through TIAA was presented, noting trends in target date fund contributions and providing a cybersecurity update. The Director's Report was deferred to the full Board meeting.

Key discussions during the meeting included the presentation of the 2025 Actuarial Valuations by the external actuary from Gabriel, Roeder, Smith & Company, noting decreases in the actuarial accrued liability for both the South Carolina Retirement System (SCRS) and the Police Officer's Retirement System (PORS). The Board received these valuations for information and adopted employer contributions for the Judges and Solicitors Retirement System (JSRS), the General Assembly Retirement System (GARS), and the South Carolina National Guard (SCNG) System. The external auditor from Crowe presented the findings from the 2025 Audit Reports for the Deferred Compensation Program, Retirement Systems Financial Statements, and Insurance Financial Statements, all receiving an unmodified "clean" opinion. The Board also reviewed and approved the schedule of board and committee meeting dates for 2026. Committee reports covered an open enrollment update and the Health Initiatives and Value-Based Benefits report from the Health Care Policy Committee, internal audit reports and plan updates from the Finance, Administration, Audit and Compliance Committee, and investment performance reports from the Retirement Policy Committee. In old business, it was noted that the contract with the current Pharmacy Benefit Manager expires at the end of 2025, with CVS Caremark becoming the new PBM effective January 1, 2026.