School Health Premiums Rise 5 Percent in Jackson (MO)

December 2, 2010

With plenty of public school systemsseeing jumps in health insurance premiums, the Jackson School District may becounting its savings.

The Jackson School Board recentlyapproved a health insurance renewal contract with carrier Anthem Blue CrossBlue Shield for 2011. The district’s premiums will rise 5 percent, which islower than the projected 10 percent increase for the Cape Girardeau SchoolDistrict and below the projected national average uptick of 8.2 percent.

"This seems like it’s a veryfair adjustment," superintendent Ron Anderson said.

The plan covers about 490 activeemployees and 125 retirees, Anderson said. Beginning Jan. 1, the district willpay $497.55 per beneficiary. Employees can choose to pay for a buyup plan,which typically includes lower deductibles.

Last month, the Cape GirardeauSchool Board opted to put its health insurance plan out to bid after facing adouble-digit increase from Anthem Blue Cross and Blue Shield. The provider, atthe request of the district, trimmed its planned 19.7 percent premium increaseby raising employee health costs — deductibles, prescription drug copays andcharges for office visits.

Insurance costs in large part aredriven by medical loss ratios, or the amount of premiums spent on health careversus administration and profits. The Cape Girardeau School District’s lossratio was 96 percent, significantly higher than the Jackson School District’srate.

Cape Girardeau superintendent JimWelker said bids from carriers are scheduled to be in by the end of the week,in advance of Wednesday’s school board meeting. The meeting was moved up bynearly a week to give staff more time to enroll employees in the plan the boardapproves.

"We did have interest expressedby several companies, but we will know more after Friday," Welker said.

Employer health care costs foractive employees are projected to rise 8.2 percent in 2011 (after projectedplan changes), to an average annual cost of $10,730 in 2011, according to arecent survey of 466 large and midsize employers conducted by Towers Watson, aglobal professional services firm.

In Cape Girardeau, the schooldistrict this school year will pay about $4.1 million in health insurancecosts, more than double what it paid a decade ago. Today, health care benefitsmake up about 10 percent of the district’s budget.

The Jackson School District paysabout $2.5 million in health insurance costs, Anderson said, asserting theexpense most be monitored on an ongoing basis.

"If we had an unusualadjustment, what would we do to redirect that?" he said. "It’s anannual thing and everybody [in public education] is in that same boat."