Parties debate health plans at open negotiations

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Ongoing teacher contract negotiations last Tuesday centered primarily on a debate over healthcare options.

The two-hour session began with Colchester School District representatives presenting new healthcare and salary plans.

The board’s new salary offer increased slightly, from a 2 percent raise per year over three years, to a 2.15 percent increase in the first year and 2.2 percent in subsequent years.

On healthcare, the district offered a healthcare reimbursement arrangement, or HRA, an employer-funded account that reimburses employees for out-of-pocket expenses and premiums.

Although new hires wouldn’t be eligible for an HRA, they could choose from four plan options – platinum, gold, gold consumer-driven health plan and silver CDHP – like current teachers.

The board offered to pay 80 percent of the premium, a holdover from its initial offer. This would save $228 for each single teacher choosing the platinum plan and $1,703 for parents with one child on the Silver CDHP plan.

“We really understand that this is a big change, and we want to make up some of this out-of-pocket between the savings you’re going to get in your paycheck and HRA contributions from the district,” said Lincoln White, a board negotiating team member.

Under the new proposal, the district would fund an HRA for single teachers on the platinum plan with $100 and with $681 for a parent and child on the silver CDHP plan.

The teams agreed the newly proposed gold CDHP plan is most similar to the current family plan option, the most commonly chosen plan. The district provides healthcare plans for 151 teachers, 69 of which are on the family plan, 41 on the single and 41 on a two-person plan, CEA president Joe Cheney said.

The annual premium totals $23,792 for the current family plan. The district pays 80 percent – about $19,034 – and employees absorb 20 percent, or $4,758.

Total annual premiums for the new family plan amount to $17,394. Based on the board’s new offer, which would keep the 80-20 cost sharing intact, the district would pay $13,915 – a $5,118 savings– while teachers would pay $3,478, saving approximately $1,280.

The district would then contribute $512, or 10 percent of its total premium savings, to the HRA for these teachers.

“The whole new plan is already less than what you guys are contributing right now,” Cheney said.

White acknowledged Cheney’s statement, but reiterated that while the district would spend less, they would still pay 80 percent of the premiums.

Discussion then moved to teachers’ out-of-pocket medical costs. Currently, teachers pay around $20 in copays depending on the type of doctor visit, Cheney said, which makes up a large part of out-of-pocket costs.

Cheney is concerned the board’s new family plan would raise maximum out-of-pocket costs to $5,000 and only contribute $1,791 – the total of the HRA and premium savings – toward that potential cost.

He added that even if the district fully funded the HRA to cover all out-of-pocket costs up to $5,000, which would cost $18,915 for the gold family plan, the district would still spend less than it does now.

“That’s not including any savings you would get if a teacher isn’t using the insurance at all,” Cheney said.

According to district numbers Cheney read, 8 percent of teachers wouldn’t use the HRA, 42 percent would use up to $1,500 and 50 percent would use somewhere between the $1,500 and the full deductible.

“Even if you were to cap it at the full deductible, there is still huge savings there,” he said.

In that same vein, CEA negotiator Tara Sharkey noted if the district fully funded the HRA, it would not lose that money if a teacher didn’t spend it.

“You’re not giving that money to the employee; you’re just saying it’s here in case you need it. If not, the district is going to save it,” she said.

White acknowledged this but said this would amount to “disproportionate” savings, since instead of paying 80 percent and saving 80 percent, he said, the district would pay 80 percent and save less.

The conversation then shifted to funding HRAs based on the plan chosen by the teacher. If one plan is more cost effective for the district, Cheney said, the district could pay a higher percentage of the HRA for that plan.

“It’s a very common approach,” said George Trieb, CSD’s business and operations manager.

Though the sides sought to bring their proposed HRA funding closer, the gap wasn’t small. Given that, Sharkey suggested both parties tweak the numbers. Each panel then did similar calculations using an HRA with $3,700, leaving $1,300 for out-of-pocket costs.

“That basically puts the teachers back at null – basically the same, no change,” Sharkey said.

Cheney reiterated his point that less than half of the employees would use $1,500 of the proposed HRA. Additionally, he noted for the 8 percent of teachers that don’t use any of the HRA, the district would save the full $3,700.

After a 10-munite caucus with 15 minutes left in the allotted negotiating time, the CEA came back to the table with a healthcare counter offer but did not address the salary proposal submitted by the district at the start of the meeting.

The CEA proposed for all teachers, including new hires, the 80-20 premium cost split be kept and that for the gold CDHP family plan, the district pay 90 percent of the $5,000 HRA.

“That gives the school district substantial savings, and I think that gives the teachers some savings as well,” Cheney said.

Tuesday’s session ended with district representatives stating they couldn’t come to agreements on healthcare without pinning down the salary question since the issues are intertwined.

The CEA agreed to come to the next negotiation with a new salary proposal.