School district health plans: big savings to taxpayers if employees chip in

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Idaho taxpayers could save millions of dollars if the state’s school districts started requiring their employees to contribute to their monthly medical plan premiums, but the Idaho Freedom Foundation has found that many schools continue to demand that taxpayers fund 100 percent of the cost of medical benefits of district employees.
 Assuming school employees were to pay just 10 percent of the cost of medical insurance premiums, the savings would be at least $11.1 million.

Crunching the numbers

The Idaho Freedom Foundation obtained records from the state’s 20 largest and 20 smallest school districts and found that many require taxpayers to finance the entire medical premium of each employee.
Of the 40 districts we contacted, only a handful require employees to pay any portion of the cost of their medical insurance premiums.  Meridian, the state’s largest school district, requires individual, full time employees to pay $11.50 per month toward their medical premium, which works out to about 2.75% of the total cost. 
In comparison, according to an October 2008 article from Forbes.com, the average private sector employee in Idaho contributes 16 percent to his or her monthly premium.  State employees pay for 8 percent of their medical insurance premiums, while taxpayers pay the remaining 92 percent.
To avoid overinflating the possible savings associated with requiring school employees to start covering some portion of the cost of medical insurance, we estimated that Idaho's mid-sized school districts spend at least $221,000 a year for insurance -- a reasonable assumption, given that the smaller Nez Perce School District, which spends the most among the 20 smallest, spends that amount annually. Using that figure, it's easy to estimate that Idaho's public schools spend at least $111.8 million a year for medical insurance premiums.

Estimated savings

Using our estimated numbers, we figured what would be saved if employee contributions of 10, 16, 30 or 40-percent were required in all of Idaho’s school districts:
Percentage        x           Total est. expenditures        =       Est. savings to taxpayers
10%                                    $111,808,495                             $11,180,849
16%                                            “                                             $17,889,359
30%                                            “                                             $33,542,548
40%                                            “                                             $44,723,389

Why are we paying 100%?

So why don’t school districts require their employees to contribute to their own insurance coverage, as the private sector does?  Kathy Wistisen, with the North Gem School District in Bancroft, says it would amount to a pay cut for employees.  “If you say we’re going to back off -- the employee has to pay 20 percent of their insurance -- then you’ve just cut their wages that much.”
But in the state’s second-largest district, the reality of the budget crisis is starting to sink in.   “That’s where people are going, that’s where private businesses are going toward: employees contributing a portion,” said Brent Nye with the Boise School District.  “To be honest, probably one day we’ll be there.  And that’s the challenge, because benefit cost is part of total compensation, they have only so many dollars to compensate the employee with, whatever you put into insurance is taken from dollars that would otherwise be available for salaries.”
The lack of taxpayer involvement in the “shopping” process might be one reason school district employees are not required to ante up for their coverage.  Generally speaking, school districts use a committee process to choose which coverage limits, deductibles and other features they want, in a sort of play on the concept of the fox guarding the henhouse.
Allison Westfall with the Nampa School District describes how it's done it in the state’s third largest district.  “The district receives proposals from different companies.  Those proposals are reviewed by an insurance committee made up of teachers, district staff who work with insurance providers, and administrators.  The committee makes a recommendation to the district’s negotiation team.  The final decision is made as part of the master contract which is approved by the school board and the teacher association.”
So the teachers, staff, administrators and the union are represented, but the taxpayer is not.
Requiring an employee contribution is only one way school districts could cut the amount they spend on employee medical coverage, and thereby ease the burden on the taxpayer.
(Joe Rossi provided research assistance for this article)

Comments

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enjoy...the like minded thoughts

"Performance Pay" as they

"Performance Pay" as they call it for teachers is ridiculous. People who talk about that have NEVER been in a Title One school dealing with poverty, child abuse, learning disabilities, and neglect. Who is going to teach there when their pay is based on their "performance" in the classroom? How do you rate their ability to inspire, challenge, and teach these kids? When was the last time you saw an "inspirational" film that deals with teachers and working with children of poverty at the elementary level? As a teacher at at a Title One school, I would love to make more money, but I fear for the students left behind by good teachers simply because they can't get them to perform on a state test.

Interesting

Interesting

Common Sense is dead

Yes, that is a great way to reduce education cost, but what about private education. It is way past time for vouchers. If the money is to be seized from the collective disproportionately, in order to offer even a token of equitability each student should be allotted a voucher to school where they and their parents wish. However, we must ask ourselves, what is the goal of public education? Is it to provide the best education for the dollars available or is it to condition the children and preserve the monopoly?

University of Idaho economics professor John T Wenders wrote this piece for the Cato institute a while back.
http://www.cato.org/pub_display.php?pub_id=4210

No silver bullet

While I agree that it is generally a good idea for employees to have to contribute to their health care premiums, in this case, Ms. Wistisen's comment is spot on--this would be a reduction in teachers' total compensation and is no different than a salary cut. If the decision is to cut teachers', that is fine, but we must live with the attendant consequences--i.e. likely even fewer teachers willing to teach in public schools when their total compensation gets reduced. Simply making them pay a portion of their health care premiums is no silver bullet for our budget problems.

Silver Bullet? Not even a nerf dart

When teachers actually get a pay cut and not just a reduction in their COLA it will be a first! Again, private sector employees are taking pay cuts and few employers are paying 100% of an employees health and dental insurance. It is time that teachers get the treatment the private sector takes and not believe they are saints and martyrs! These are folks that most likely took the job of teaching because they like the part time work! If they were actually doing what they tell us they are doing we wouldn't be worrying about a generation having issues with making change at the 7-11 or whether the next big thing will be developed in China! Get over it teachers! And people that simply think they are a gift really need to get an education.

lol

I started working as a public school teacher 6 years ago for 25,000 a year. My friends at HP and Micron have had X-mas bonuses and stock options in one week that have almost equaled my annual salary! quit with the anti education propaganda...

you probably inherited your money...right?

Idaho School Insurance

I'm not a union fan at all. The pay package should be negotiated by the each employer and employee depending on them meeting qualifications and experience. Raises should be given depending on results. If a teacher constantly performs well in the classroom, he/she should receive good raises. Some basic group insurance should be included because of the ability of the group to get better rates. The overall pay package should depend on market conditions.

As to cost saving, I believe there are way too many regulations, administrators and sometimes even facilities. Look to private schools that know how to stretch a dollar. Do not accept any federal government money as it generally comes with so many strings attached that it is counterproductive. Demand that it be returned to the taxpayer that then can afford to pay for that "free lunch". If is much easier for a taxpayer to ask questions of the local school board than the federal government.

Public schools hire good professional educators and then tie their hands behind their backs. Generally their opinions are not heard when it comes to resources, classroom materials and all the decisions it takes to run schools. For example, they generally aren't allowed to enter grades directly into a database. It is said, "there might be a mistake". I ask, “why did you hire a professional”? The data entry person should go and the teacher held accountable for his/her actions. Simply stop duplicating effort.

School boards should seek most services from private enterprises. This includes buildings, transportation, food services, security, legal services and maintenance. Demand that they supply qualified personnel, services and products. Reward them for cost savings. My understanding is that some districts pay 3 to 4 times what another pays for new school construction on a per square foot basis.

I hope my response gives some food for thought, as the problem is much bigger than just who pays for insurance.

Charter Schools

What applies to regular schools does not apply to charter schools. They do not have health benefits for teachers. Teachers have to purchase their own health insurance. Another good reason to have more charter schools allowed in Idaho.

Educators Ins.

I have a question on the Health Insurance plans for teachers.

The artical states, "The district receives proposals from different companies."

There are only two insurance "companies" in the state, which happens to be Blue Cross and Regence Blue Sheild. These are the "companies" that normal Idaho families have to choose from. Does the above statement indicate that school districts can shop across state line's?

Also, what is an average deductable, an average copay on office visits/prescriptions etc. on the policies. Also what is the average premium paid per employee and are the teachers families included on their policies. If so, is the premium portion for the families taken form the teachers salaries or is that at tax payers expence also?

I and my family may not be amoung the norm, however I saw the doc two times last policy year and two of the three children saw the doc one time each. The third child has had no need to see a doc in three years.

My point being, our premium costs this last policy year was right at $9,000.00. This is with a $2,000 deductable and a $40.00 copay for O.V. and I am faily sure educators get a much better deal up front than I and my family do. They most certainly could bare a portion of the cost.

I beleive that a LOT could be done to cut the taxpayers expences for educators; insurance being, as you stated, a big one!

I am a teacher, I take home

I am a teacher, I take home $1850.00 a month after I pay 965.00 per month to have my healthy 5 year old son and healthy 37 year old wife on my health insurance plan. Try supporting a family on that...I have an MBA, I chose to go into teaching to make a difference after working at Microsoft in Redmond for 4 years. Looks like I'll have to go back to the private sector. Idaho will never get high tech firms like Yahoo, Google, Microsoft etc. to move to this state until they start paying comparable teacher's salaries to neighboring states like Wa, and Or.

My friends who work for HP dont pay anything for their entire families' health care!...wonder what our "fiscally conservative" state lawmakers pay for health care for their families?

Educators Ins.

I have a question on the Health Insurance plans for teachers.

The artical states, "The district receives proposals from different companies."

There are only two insurance "companies" in the state, which happens to be Blue Cross and Regence Blue Sheild. These are the "companies" that normal Idaho families have to choose from. Does the above statement indicate that school districts can shop across state line's?

Also, what is an average deductable, an average copay on office visits/prescriptions etc. on the policies. Also what is the average premium paid per employee and are the teachers families included on their policies. If so, is the premium portion for the families taken form the teachers salaries or is that at tax payers expence also?

I and my family may not be amoung the norm, however I saw the doc two times last policy year and two of the three children saw the doc one time each. The third child has had no need to see a doc in three years.

My point being, our premium costs this last policy year was right at $9,000.00. This is with a $2,000 deductable and a $40.00 copay for O.V. and I am faily sure educators get a much better deal up front than I and my family do. They most certainly could bare a portion of the cost.

I beleive that a LOT could be done to cut the taxpayers expences for educators; insurance being, as you stated, a big one!

Education is NOT education.

I awoke today with the realization of my failure to connect the dots about the ineffectiveness of the education system, notwithstanding my study of John Taylor Gatto's book, THE UNDERGROUND HISTORY OF AMERICAN EDUCATION and his stating that it was born of influence from Prussia. I don't know why he never stated that it was the consequence of the Communist Manifesto's 10th plank, "Free education for all children in public schools. . . "

The purpose of education is not education but the redistribution of wealth.

Purpose of education is NOT education.

Coincidentally, I awoke today with the realization of my failure to connect the dots about the ineffectiveness of the education system, notwithstanding my study of John Taylor Gatto's book, THE UNDERGROUND HISTORY OF AMERICAN EDUCATION and his stating that it was born of influence from Prussia. I don't know why he never stated that it was the consequence of the Communist Manifesto's 10th plank, "Free education for all children in public schools. . . "

The purpose of education is not education but the redistribution of wealth.

yah who needs to educate the

yah who needs to educate the general public...an uneducated work force will be easier to manipulate for the evil forces of corporate America.

Jesus is frowning from all of the greed right now!

Wayne, I did not realize that

Wayne,

I did not realize that the folk in the private sector paid so little for health insurance. I doubt anyone has thought about it, but the whole thing would be a lot better if the entity (school, business etc) did not pay any of the health insurance, but gave the money to the individual. They could then pick the insurance plan that suited them the most, or no plan as they chose. We have never had health insurance and have survived. It has not been easy at times, but God has been faithful. I wonder if given the choice how many people would rather have the money than the insurance. I think some health care policies cost almost $1,000/month. That is a lot of money. At the very least I think that teachers ought to pay 50% of the cost. That way they have a part in the program and will not be so inclined to abuse the system.
Jim Hollingsworth

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