Mehlville school district employees could see a 100 percent increase in their health insurance rates starting in January because of rising costs in the healthcare industry.
That’s according to a committee made of district officials, teachers and classified staff. The committee met Aug. 28 to form a recommendation for the school board at their Sept. 25 meeting.
Board President Venki Palamand served on the committee and said the increase could also come with a decline in benefits. Employees could pay more for emergency room visits and doctor copays.
A majority of the committee recommended a 50/50 split between the district and employees for the increase. Of about 20 people at the meeting, Palamand said two were opposed.
Currently, rates are $460 a month. The district pays approximately $428 and employees pay $32 of that cost.
The committee proposes raising the rates to $540, with employees and the district splitting the $80 difference. Under this plan, employees would go from paying $32 to $72 a month.
Chief Financial Officer Noel Knobloch said the rising costs were from increased costs in the healthcare industry and provisions under the Affordable Health Care Act.
One percent of the district’s insurance members have spent 30 percent of the money due to large claims, he said. The district had seven or eight claims over $100,000 last year.
“Our brokers are predicting that in 2013, the Affordable Healthcare Act might add 3 percent to the premium, and between 6 and 8 percent in the 2014,” he said.
The district is self-insured and must maintain a reserve balance of approximately $2.5 million, Knobloch said. Balances now are just under that, at $2.3 million.
“If you don’t increase premiums and costs continue to escalate, (balances) erode every year,” Knobloch said. “We had a healthy balance several years ago, but have had several years of higher claims.”
The committee looked at other alternatives, including raising the rates by $100 with different splits between the district and employees.
There are about 1,350 people on the district’s insurance plan. Of those, about 185 are retired employees who can buy back into the plan.