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December 21, 2014

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With health care costs rising, CCSD mulls districtwide insurance plan

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Steve Marcus

New teacher Amanda Ford, center, talks with Candy Smith, service director for the Teachers Health Trust, during a Clark County School District orientation session for new teachers at the Venetian Thursday, Aug. 15, 2013. Over 1,700 teachers took part in the orientation.

The Clark County School District is considering a single, districtwide health insurance plan to offer cheaper health care to about 60,000 employees, dependents and retirees.

For the past several years, the School District has been trying to consolidate its employee health insurance plans to combat rising health care costs. Since 2011, the district’s health insurance costs have increased by more than 20 percent amid new federal health care mandates.

By bringing all employees under the same health plan, district and union officials believe the state’s largest public employer will have the bargaining power to negotiate lower health costs.

“There is an opportunity here to provide something much better,” School Board member Linda Young said. “This has the possibility for a win-win.”

Currently, Clark County’s administrators, police officers, support staff and teachers have separate health insurance plans, which are negotiated by their respective unions.

The School District offers six health insurance plans to its administrators, police officers and support staff through United Healthcare’s Health Plan of Nevada. The Clark County teachers union provides two health insurance plans to its 18,000 teachers and their dependents through the nonprofit Teachers Health Trust.

To study how a consolidated health insurance plan could be implemented, the School District and the teachers union hired an independent insurance consultant, Mercer Health and Benefits, LLC. To prevent a biased report, the School District and the Clark County Education Association split the $158,350 consulting fee.

Mercer consultants presented their findings to the School Board during a three-hour special meeting Monday evening.

The consulting firm found that both the district’s and union’s health insurance options offer “generous” benefits at an affordable price, relative to similar plans across the country.

“Both organizations have done a remarkable job,” said John Vlajkovic, a Mercer partner overseeing health and benefits. "The experience through both plans are exceptional compared to what we usually find in the marketplace.”

However, “the world is changing around us,” Vlajkovic said. The Affordable Care Act has escalated health insurance costs while providing more health care options for employers and employees, he said.

And as the number and cost of medical claims rises, so too will the district’s health insurance costs, Vlajkovic said. The district and union’s current health insurance options are unsustainable, he said.

“As we look forward, we’re concerned (that claims) are going to catch up,” Vlajkovic said. “At some point in time, the obligation to pay for all of the claims incurred is going to a reality.”

Mercer recommended a consolidated health care plan for 30,000 full-time employees in the district, as well as their dependents and some retirees. The consultants left it up to the School Board to decide what kind of health plan and benefits level they want to pursue.

The School District will now negotiate with its four employee unions over several options for health insurance plans.

Union leaders said they welcomed the Mercer report and its findings, but strongly urged the School District to maintain good health benefits for employees. Many union members said they favored a nonprofit health insurance model, similar to the Teachers Health Trust.

“Not one penny should go into profit. It should be invested back into teachers,” John Vellardita, CCEA’s executive director, said. “What we want is affordable, quality health care for all employees. We don’t want disparity in care.”

District officials hope to have a consolidated health plan in place by January 2016.

“This will take some time,” Skorkowsky said. “We need to move on this, but we need time for everyone to process this information. This is a very difficult topic to wrap our heads around.”

Check back later for more on this developing story.

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