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Health-Care Maneuver Cut Costs, School Trustees Say

Capistrano Unified says paying more for teacher insurance premiums saves $61,000 a year.

When Capistrano Unified officials agreed in November to , critics sniped that it was fiscally unwise in the face of state budget cuts.

But on Thursday, the district announced it had saved $61,000 with the move.

In exchange for picking up the tab for higher health insurance costs, the district asked the teachers' union to urge its members to shift to less expensive HMO medical plans run by Anthem Blue Cross and Kaiser, the district said in a press release.

The strategy led 133 teachers to switch from pricey point-of-service health plans to an HMO, the district said. And that shaved $390,000 off premiums paid by the district, resulting in projected overall savings of $61,110 for 2012.

If the trend continues, future years could see additional savings, officials said.

“I am glad that we were able to negotiate these savings with our teachers and look forward to finding even more ways to extend the district’s limited resources,” school board President Gary Pritchard said in the press statement.

Teachers' union president Vicki Soderberg agreed, calling it a "win-win for everyone."

During the district's annual “open enrollment” period for health benefits, 133 teachers moved from the Anthem Blue Cross POS, which costs up to $17,731 a year for a family of three or more, to HMOs that cost about $3,000 less, the district said.

Capo mom January 20, 2012 at 01:07 AM
Thanks for the follow up, Roy. It is is my understanding that premium costs increased for the coverage provided for both the HMO and POS plans. CUSD is now responsible for the full cost of the increase in HMO benefits and half of the increase for the POS plan (which this article fails to discuss). The district is paying half the cost of the increase for the teachers who are still being covered by the POS plan. If this is a significant percentage of teachers in CUSD, it is probable no savings were realized. Without the missing information (the number of teachers covered by a POS plan and the district's actual cost for the increased POS contribution), it is impossible to know.
Penny Arévalo January 20, 2012 at 03:35 AM
CM, according to the report in November, the district was paying (before the vote), $25 million in health and welfare plans. The pick-up of the premium hikes (like you said, half the increase for POS plans and the full hike for HMOs) comes to an extra $165K for this year and next.
Capo mom January 20, 2012 at 05:19 AM
At the risk of flogging a dead horse, the estimate you quote is the cost for the district having done nothing. But the district actually did something. If I understand the situation correctly, the math looks like this; CUSD does nothing; cost is $339,000 133 teachers switch from POS to HMO at a savings of approximately $3,000/teacher (133 x 3,000 ≈ 399,00) 399,000-339,000 ≈ 60,000 However, there is no offset accounting for CUSD's increased contribution for POS participants (however many there are x 50% of the cost increase). I am trying to understand what the true cost of this action is to CUSD is and why Patch would print this information without attribution.
Roy Rivenburg January 20, 2012 at 05:36 AM
As I read the info from CUSD, the $329,000 covers the increased premiums for BOTH types of insurance. The 133 who switched to HMOs save a net $61,000.
Capo Parent January 20, 2012 at 04:49 PM
OM makes a valid point and observation. Since CUSD agreed to pickup 50% of the increased POS costs, that number has to be quantified and put into the equation so that there is an honest and accurate accounting to determine if CUSD is really saving money, or is this another example of CUSD providing a half-truth to the public to make itself look good at the expense of the real truth. Has CUSD released the data showing how much the 50% increase in POS is actually costing?

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