State of North Carolina

Office of the State Controller

June 8, 1999

MEMORANDUM No. NCAS-99-0021

The current Health Benefits Interface creates transactions which post employer medical insurance costs to the NCAS with an offset to a liability clearing account, 211930. Transactions for all insurance carriers are posted to this single clearing account, making the reconciliation of balances in account 211930 extremely difficult for those agencies using multiple insurance carriers.

Based on input from several agencies, OSC is implementing a change in the Health Benefits Interface that will simplify the reconciliation process for the Health Benefits clearing account. Effective July 1, 1999, the clearing account posted to the General Ledger from the Health Benefits Interface will include Central Payroll’s three-digit code that identifies each insurance carrier providing medical insurance services in the seventh through ninth positions of the clearing account. The following accounts will be used by the interface in the next fiscal year:

OSC will validate the accounting distributions needed to implement this change, but only those insurance carriers currently used by an agency will be established. OSC will also inactivate all clearing account distributions used in the current interface on July 30. This will provide each agency thirty days to move any balances remaining from the previous fiscal year.

The beginning balance for these new accounts will be established when each agency processes a carryforward check on June 29, 1999 for any balances remaining in the current clearing account. A balance in account 211930 at June 29 should represent amounts held for employees and eligible for disbursement in the next fiscal year. Balances not relieved prior to July 1, 1999 may revert to the state at year-end. The cash carryforward is recorded in the Accounts Payable module with the issuance of a check as follows:

The entry to record the receipt of the carryforward check is posted by a journal voucher with an effective date of July 2. Agencies must determine to which insurance carriers the amounts being carried forward relate and then record the deposit against the correct carrier clearing account. For example, if amounts are carried forward for Wellpath, Kaiser, and Maxicare, the deposit entry would look like this:

All subsequent transactions should be recorded at the carrier level, following the procedures shown in the SIG under Accounting System/Documentation/Policies & Procedures/System Processes/Agency System Management/Statewide Health Benefits and Payroll Interfaces. Using these procedures, agency staff will be able to determine which insurance carriers have reconcilable balances and which have cleared completely.

Please direct any questions regarding this change in the Health Benefits Interface to the NCAS Help Desk at 875-HELP.

ZP/eac