GASB & OPEB Consulting


To obtain the necessary financial information to meet the GASB 74 and 75 requirements, employers require OPEB valuations. The valuation determines the annual OPEB cost and the net OPEB obligation and evaluates funding progress. A GASB OPEB actuarial valuation is similar to a pension valuation, and CMC can help you meet those requirements, while exceeding your expectations.

Retiree Health Care Valuations

We perform valuations of OPEB benefits to determine the liability for all benefits promised to active, retired, and inactive plan members as of each valuation date. Applying the actuarial funding method and reflecting the actuarial value of assets will yield the employer contribution rates necessary to fund the promised benefits adequately and in accordance with Governmental Accounting Standards Board (GASB) Statements 74 and 75. We value making our reports easily understood. Our reports include a summary of plan provisions, an outline of assumptions and methods utilized in the valuation, displays of member statistics, and a glossary of terms.

Expense and Disclosure Requirements of GASB 74/75

Public entities are required by GASB 74/75 to disclose benefit costs and liabilities for the non-pension benefits provided after employment ends. This disclosure also means you must confront now the future viability of these benefits, as well as the impact of legislative changes, such as the Medicare Prescription Drug benefit. Once CMC helps you determine these liabilities, we also will assist in developing funding and plan design alternatives.

Detailed Gain and Loss Analysis

Our normal valuation work includes an analysis of the sources of all actuarial gains and/or losses. However, it can be helpful to look in more detail at certain aspects of the funding picture, such as changes in unfunded accrued liabilities. Gain/loss analysis examines each risk area and the changes each is undergoing. If any significant trends materialize, we make recommendations for changes in actuarial assumptions.

Analysis of Proposed Legislation

We are frequently called upon to assess the merits and cost impact of pending legislation. In doing so, we assist clients in determining the cost of proposed legislation, compliance with federal and state law, and the impact on plan administration. Our experience indicates that many proposed legislative changes to retiree health insurance plans also affect pension plans and it is imperative that the impact to both pension and OPEB liabilities be determined.

Legislative Testimony

Our senior consultants have extensive experience in testimony before the legislature or a committee of the legislature. Recent topics we have addressed include: OPEB disclosure items, compliance with GASB 74 and 75, plan design, and funding alternatives for GASB.

Experience Studies

The one thing an actuary can count on is that some assumptions will need to be modified over time. We recommend that, once every five years, an experience investigation be conducted. An experience study measures plan liabilities by comparing actual plan experience for the study period with that predicted by the current assumptions used in the actuarial valuation process. The investigation compares actual with expected experience for all economic and non-economic assumptions used in the annual actuarial valuation, makes recommendations for changes where appropriate, and determines the impact of the recommended changes on plan OPEB funding.

Multi-Year Benefit Cost Projections

Clients often find it helpful to have multi-year benefit cost projections in hand when developing a funding strategy for their benefits program. By projecting costs over several years, we can assume a higher discount rate due to the accumulation of assets available for investment. Such projections demonstrate the difference in your plan’s financial state under a variety of advance funding scenarios. The results often prove useful in supporting arguments for appropriating sufficient funds for advance funding OPEB benefits — to say nothing about more favorable bond and credit ratings for you.

Health Care Plan Design Changes

CMC is experienced with all types of health care plan options and can help you choose the plan or mix of plans that will best help you reach your goals. Our work considers a number of factors, such as distribution of risk, stability of costs for employer and employee, competitiveness in the marketplace, funding rates, plan options and the pricing of options. Whether you are considering a consumer-driven health care plan or a more traditional plan selection, CMC’s consultants can help you properly design a strategy that delivers quality, effective, accessible and affordable care for employer, employee and retiree.