As President Barack Obama geared up to address the nation in support of his health care overhaul, Hernando County school authorities found themselves facing an unexpected jolt in their insurance realm.
The insurance provider for the district, Blue Cross Blue Shield of Florida, has put forth an astonishing request for a 21.5 percent increase in rates.
“Anticipating health insurance cost hikes is one thing, but a 21 percent surge catches everyone off guard,” remarked Heather Martin, the district’s head of business services. “This is quite disheartening, especially considering the current economic climate.”
While the actual increase is likely to be somewhat lower, Martin mentioned. Last year, for instance, Blue Cross commenced with an 18 percent surge. By tweaking plans and adjusting deductibles and co-pays, both parties managed to bring it down to 12 percent.
Martin holds an optimistic outlook, hoping that the increase for the current year would hover closer to 15 percent. She informed that the district’s insurance committee, comprising staff members and representatives from both unions, had made progress in discussions with Blue Cross on Wednesday.
Blue Cross refrained from offering more insight, only releasing a written statement through spokesperson Mark Wright. “The details of our negotiations with any client remain confidential. However, I can affirm that for groups like this, the anticipated claims experience for the upcoming plan year plays a pivotal role in determining premium rate adjustments.”
In simpler terms, the company leverages the district’s historical claims data and projections for the next year’s claims to substantiate the rate hike.
Martin candidly admitted that the district’s claims history isn’t favorable. Recent years have witnessed claims on the higher side, she noted. Just last year, Blue Cross disbursed over $14 million in claims.
“We can’t tout ourselves as a particularly healthy district,” Martin acknowledged. “We haven’t shown improvement in this aspect.”
She highlighted, though, that the district faces repercussions due to the absence of urgent care facilities in the county. This compels employees to resort to costly visits to hospital emergency rooms for urgent care, driving up the district’s claims.
In previous years, the School Board consented to having the district absorb a significant portion, if not all, of the insurance premium hikes. Board member Sandra Nicholson suggested continuing the same approach this year. “If there’s any chance we can shoulder the increase, I believe we should consider it,” Nicholson opined.
However, this could pose a challenge given that this year’s proposed budget only sets aside $1 million in reserves without earmarking them for any specific purpose.
Nevertheless, this move could bring relief to employees who have been grappling with rising out-of-pocket expenses, pointed out Colin Davies, president of the Hernando United School Workers.
Davies disclosed that some employees have been forced to forgo insurance due to affordability issues, and he cautioned that this number might increase.
“It’s a choice between having a meal and having insurance,” Davies summarized.
The unions had accepted modest pay raises in the prior year in exchange for the district absorbing more of the insurance premium expenses. Joe Vitalo, president of the Hernando Classroom Teachers Association, anticipated a similar focus on insurance in this year’s negotiations.
Vitalo conveyed a sentiment shared by many Americans, one that President Obama highlighted as a driving force for swift healthcare reform. “This could be seen as one of the most sanctioned forms of extortion,” Vitalo concluded.