Teachers' plan envy of many

Teachers' plan envy of many

August 23rd, 2014 in Opinion Free Press

Hamilton County Schools employees may not get much sympathy from the average Chattanooga worker after the revelation Thursday that teachers and others may have to pay an additional $100 a month to keep their spouses on the school district's health plan.

The higher cost of health insurance is never good news, but teachers and other system employees have a plan their employee benefits manager said in December was "kind of unheard of."

With no deductible and low co-payments, the high-cost, low-cost-sharing insurance plan is so good it nearly qualifies for the Affordable Care Act's so-called "Cadillac tax," which is set to take effect in 2018.

School officials said the plan doesn't quite reach the Cadillac threshold, which targets certain no- to low-deductible plans, but they had warned in December that some type of adjustment would need to be made to offset rising costs.

Thursday's announcement by the Hamilton County Board of Education indicates the system wants to shear about $5 million from its $50 million-plus annual health care cost.

Among the options to reach the cost savings include the additional $100 out-of-pocket cost or having spouses buy insurance from their own employers if those plans are available. Increasing pharmacy co-payments also is on the table.

The decision -- a vote on which was put off for a week -- will affect more than a third of the system's employees (1,700 out of 4,678), so nearly two-thirds wouldn't pay the extra $100 if that's the route the system takes.

Among the other niceties in the system's current Cigna Health Maintenance Organization plan, MRIs, CTs, X-rays, blood work, prenatal and postnatal care are all free with in-network providers. In addition, a specialist visit runs $20, the outpatient copay for surgery is $50, and hospitalizations and emergency room visits are $100.

The system's preferred provider plan requires a $450 deductible, then covers 90 percent of all costs.

"It is one of the best and therefore one of the most costly of any other school system across the state," Ed Adams, the county's risk consultant, said in December.

Whichever way the school board decides to go on cutting the $5 million -- and Adams said a committee looking at cutting costs was open to "out of the box" solutions -- employees would switch from BlueCross BlueShield of Tennessee's premium Network P to Network S, a savings of $1.3 million. And either way it goes, the cost of emergency room visits would increase to $250 for employees on the HMO plan.

Going into the 2013-2014 school year, the system increased the payroll deduction for dependents' coverage and created a high-deductible plan -- mandated as an option by Obamacare -- but officials knew more needed to be done.

For years, the system had used its generous health insurance plan as a recruiting tool to accentuate what many felt were relatively lower salaries. But now the system is being forced to go the way of many large employers in controlling costs.

Hamilton County government, whose plan had been deemed a "Cadillac plan," went down this route a year ago. Even at that, county officials said at the time, its employees' health care was projected to cost $23 million, up $3.7 million from the previous year.

"Recognizing the changes that the Affordable Care Act was going to bring, and also the fact that we're trying to control costs -- it just made sense to put everyone on a more traditional plan," Alecia Poe, the county's human resources director, said in December.

The city of Chattanooga's health plan does not meet the definition of a "Cadillac plan," Lacie Stone, spokeswoman for Mayor Andy Berke, said in December.

Going into the 2013-2014 school year, Hamilton County Schools teachers had received three raises -- from 1 to 2.33 percent -- in five years, according to newspaper archives. Last September, they were voted a onetime bonus of 1 percent and a 3 percent raise, retroactive to July 1. Meanwhile, some Chattanoogans haven't seen a raise since the 2008 Great Recession.

Teachers -- and all Chattanoogans -- also benefit from the fact the city's cost of living is almost 8 percent lower than the national average, including lower costs for health care, according to the Center for Regional Economic Competitiveness.

So while nobody wants to have to pay more, school employees can relish the fact their benefits are far better than most.