Review of Unfunded Pension Costs of Rocky Mountain Health Care Corporation

EXECUTIVE SUMMARY:

This final report provides you with the results of our review of Unfunded Pension Costs of Rocky Mountain Health Care Corporation (Rocky Mountain). Rocky Mountain did not make contributions to the pension trust fund for Plan Years 1987 through 1992. Accordingly, Rocky Mountain did not fund the pension costs identifiable with its Medicare segment during this period. As a result, Rocky Mountain accumulated unfunded pension costs of $543,421 as of January 1, 1996. Rocky Mountain's unfunded pension costs includes unfunded pension costs of $31,372 attributable to Blue Cross and Blue shield of New Mexico (New Mexico) (CIN: A-07-96-01195) as of the January 1, 1989 merger. Rocky Mountain must separately identify and eliminate this amount from the amortization components of future pension costs.