Higher health insurance costs may be coming to Durango School District 9-R employees as claims are coming in faster than anticipated for the second consecutive year.
The district uses a partially self-insured model that before 2017 had largely saved the district and employees money as traditional insurance rates rose rapidly. However, the last two years, the district has seen higher-than anticipated claims.
“Last year was a challenge, and this year has proved to be more challenging,” 9-R Superintendent Dan Snowberger told the school board Tuesday evening during a work session.
Employees’ health insurance premiums for two of three plans already were increased for the year. However, the increases are not offsetting growing expenses.
Snowberger said premium adjustments would likely come in January.
Beyond this year, to balance the health insurance fund, 9-R employees would likely be facing plans with a mixture of higher premiums, higher deductibles and higher prescription drug prices.
Total expenses for the health insurance fund are coming in at a rate of $5.61 million for the year. Revenues for the fund are estimated at $4.8 million
“Insurance is a risk,” Snowberger said. “It’s no one’s fault. It is what it is.”
Despite the need to increase costs to employees, 9-R currently offers plans that in the private sector would be generous, including an employee-only, high-deductible plan that is cost-free for premiums to the employee. Insurance in the high-deductible plan kicks in when an employee hits $3,000 in health expenses.
The high-deductible plan is the most popular option for the district, with 440 of about 700 full-time employees choosing it.
The district also offers an exclusive provider plan and a preferred provider plan.
Under the EPO plan covering only the employee, the district pays $445 per month and the employee pays $90. Under the PPO plan covering only the employee, the district pays $445 per month and the employee pays $40 per month. Premiums increase when a spouse and children are added to coverage.
9-R School Board President Nancy Stubbs said it would be important for Snowberger to be “proactive” by going to each school and answering employees’ questions about the looming increased employee health insurance costs.