New insurance plan nets school district savings, costs staff more

The Superior school district expects to save more than $1 million following changes to its health care insurance carrier and plan structure.

Superintendent Janna Stevens announced the changes Thursday after meeting with members of the administration and union representatives for the teachers and support staff.

The new insurance plan for the 2012-13 school year provides the district about a 20 percent reduction in premium costs, but employees will face higher deductibles as a result.

“When we get that much of a savings in our premiums, something else has to go up,” Stevens said.

Initially, the district had counted on an 8 percent reduction in its premiums — about $513,000 — to balance the 2012-13 budget, with additional savings coming from a now defunct plan to alter school start and dismissal times. The Superior School Board voted unanimously on May 14 to abandon the plan and instead moved forward with the employee health care insurance changes announced Thursday.

“Today’s meeting was a presentation on how they were going to proceed. It wasn’t a mutual discussion.” said Kim Kohlhaas, president of the Superior Federation of Teachers Local 202. “We’re not a part of the conversation because legally we can’t be. It’s not something that we can negotiate.”

Under Wisconsin’s Act 10, passed last year, health insurance plans for public sector union employees are no longer subject to collective bargaining. Unions are restricted to negotiating pay raises, which cannot exceed the rate of inflation.

The current contract for the Superior teachers, which expires June 30, sets deductibles at $750 for an individual and $1,500 for a family. After hitting those marks, costs are shared on an 80 percent-20 percent co-insurance split, with an individual paying up to maximum of $2,000 out-of-pocket and a family paying up to $4,000.

Under the new plan, the 80-20 split will be eliminated and total out-of-pocket expenses will max out at $3,000 for an individual and $6,000 for a family.

The changes to the health care plan require a vote from a school board, according to Stevens. The matter will be discussed at the board's June 4 Committee of the Whole meeting and voted on at the June 12 board meeting.

In the past, the administration and the union had always worked together to keep costs down by negotiating changes to the health insurance plan and searching for the best provider, Kohlhaas said. This year the administration handled those matters on its own.

The Superior school district received bids from two health carriers for the 2012-13 school year: its current provider, Health Partners, and Medica. Medica offered the best deal and will become the district’s new health care insurance provider.

Had the Superior school district chosen to remain with Health Partners and this year’s insurance plan configuration, premiums would have increased 12 to 17.5 percent.

“With health insurance, your only avenue for savings is to raise deductibles,” said Jack Amadio, Superior school district business manager.

Up next for the district will be negotiations with the employee unions for possible wage increases. Stevens said having the health insurance issue resolved will help the administration be fair in its bargaining.

At most, the administration can offer employees a sum equal to 3.16 percent of the base wage. The union will then negotiate how to divide that money amongst its members.

“We aren’t even able to make the cost of living anymore,” Kohlhaas said. “With the guidelines in place, teachers will never be able to get ahead of the rate of inflation.”

The Superior school district is also in the process of finalizing its employee handbook, which will take the place of union contracts after they expire. Stevens said the district is still on target to meet its June deadline for the handbook.

The Superior School Board will review and the discuss the handbook at its June 4 committee of the whole meeting and then hold a final vote at its regular meeting June 12. Both meetings will be held at Superior Middle School, with the June 4 meeting at 5 p.m. and the June 12 meeting at 7 p.m.

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