Education

Bernards Township School Board Considers Possible Health Self-insurance Plan

9d12b7ac17d50d20a43d_WilliamAnninMSfront.jpg
William Annin Middle School, 70 Quincy Road, Basking Ridge. Credits: By Linda Sadlouskos
9d12b7ac17d50d20a43d_WilliamAnninMSfront.jpg

 

BERNARDS TWP., NJ -  The Board of Education is considering a self-insurance plan for health benefits in which coverage and costs to the employee would be unaffected, but would make the school district the administrative handler and payer of most claims.

The change could save the school district, which has about 720 employees under the health plan, up to $1.2 to $1.4 million a year, insurance consultants say.

The plan would continue health coverage under Horizon Blue Cross Blue Shield, but the district would handle the claims and make the payments, as described by representatives of the Arthur J. Gallagher benefit services firm, based in Princeton.

Sign Up for E-News

Under the concept, the school would keep coverages, premium costs, deductibles and other features of its health benefits system.

While saving money is a huge attraction, the change in its most extreme could put the school at risk in the event of many large claims at one time, or even expensive litigation. The district would probably buy re-insurance to cover circumstances where any one individual, or the entire system, reaches pre-determined “stop loss” levels.

Gallagher actuary Christopher Diorio said the Bernards Township school district has a relatively stable claims experience that makes it a good candidate for self-insurance.

He said self-insuring could bring the district’s health premium costs to an estimated $13.3 million, down from a projected renewal of $14.7 million.

The school would save because it would avoid paying state tax, federal Affordable Care Act costs and a profit margin for the carrier.

The school would have to expect fluctuations in cash flow, Diorio said, with a cash reserve building in the first months and then leveling off as claims are submitted, items like prescription drug rebates are received and regular administrative payments to Horizon are processed.

Diorio said the school would “probably need five to 10 large claimants to not get the bang for its buck.” 

He said health care premiums would likely rise year to year, but probably not as much as the eight to 10 percent increases now being seen.

Business Administrator Rod McLaughlin said after the meeting that self-insurance could provide the benefit at a more stable cost for the district, without changing the scope and coverage of its health plan. 

The reduction would also help the school district in its annual attempt to stay under the maximum two percent increase in tax increases in the annual school budget. Employee benefits account for $14.4 million in a $93 million general current expense in the 2017-18 year.

The board is aiming at a decision by the end of the year, in order to help in compiling the 2018-19 school budget.

TAP Into Another Town's News:

You May Also Be Interested In

Sign Up for E-News

Basking Ridge

Piscataway Man Identified in Pedestrian Fatality on I-287 in Bridgewater Wednesday

June 7, 2018

BRIDGEWATER, NJ - A Piscataway man was identified as the tow truck operator killed when he was struck by another vehicle on I-287 in Bridgewater Wednesday afternoon, according to NJ State Police Sgt. Lawrence Peele.

Nicholas Coble, 24, was pronounced dead at the scene after he was struck by a vehicle while clearing another car from the roadway at 1:44 p.m.

According to Peele, Coble was in ...

Sleep out at Covenant House

June 18, 2018

I can enjoy the same movies over and over like it were the first time to see them.  My kids roll their eyes at this.  Well, many unimaginable things happen as you become a certain age, and you tend to learn to accept those things graciously as gift.   But I remember the movie “The Blind Side.”  Until I saw that movie, I didn’t know homeless children ...

Upcoming Events

Tue, June 19, 9:00 AM

The Wayrick Gallery, Scherman Hoffman Wildlife Sanctuary, Bernardsville

NJ Audubon: NJ Audubon Photography Instructors’ ...

Arts & Entertainment Green

Wed, June 20, 9:00 AM

The Wayrick Gallery, Scherman Hoffman Wildlife Sanctuary, Bernardsville

NJ Audubon: NJ Audubon Photography Instructors’ ...

Arts & Entertainment Green

Wed, June 20, 7:30 PM

Chatham United Methodist Church, Chatham

The Masterwork Chorus Launches 19th Summer Sing ...

Arts & Entertainment

Horse Care Workshops at Lord Stirling Stable Start June 23

June 17, 2018

BASKING RIDGE, N.J. — Somerset County Park Commission Lord Stirling Stable is offering Horse Care Workshop 101 for adults and youth seeking to gain experience and confidence around horses through a combination of non-riding activities and hands-on practice.

Horse Care Workshop 101 will be held at Lord Stirling Stable, 256 South Maple Avenue in Basking Ridge, NJ beginning Saturday June ...

AtlantiCast

AtlantiCast: Episode 16

Summer is in the air, and the latest episode of AtlantiCast is ready to help you enjoy some fun outdoors while staying safe! This week’s episode opens with tips for sunscreen usage from Atlantic Health System’s Chief Medical and Academic Officer, Dr. Jan Schwarz-Miller. You’ll also learn about how Atlantic Health System is advancing the future of health care through ...