The debate over insuring Mat-Su teachers

PALMER — The Mat-Su Borough School Board meeting back on Dec. 6 had educators and other school employees putting up a healthy fight.

That night, more than 100 teachers dressed in black and carrying yellow signs declaring “HANDS OFF MY HEALTHCARE” cheered on the CFO of the Public Education Health Trust, Rhonda Kitter, as she explained to the board why Mat-Su teachers are better off getting their health insurance through the Trust, rather than through a “self-insuring” system being considered by the school district in the hopes of saving the district money.

“As the CFO and the plan administrator, I feel confident in the product we provide,” said Kitter, explaining to the board that the not-for-profit Trust formed in 1996 provides health coverage for more than 17,000 belly buttons throughout the state’s various school districts. “I am extremely proud of the Trust and know its efforts to reduce the burden of insurance costs on districts and their employees. The Trust is dedicated to this goal. On average, 96 to 97 percent of premium dollars collected go to a physician, a facility, a pharmacy, dentist, or ophthalmologist, while only 3 to 4 percent is used for administrative costs.”

Kitter also said that the Trust will never hand over to the district data detailing members’ health claims. This presents the district as it continues to grapple with a $3.5 million budget deficit.

“The Trust does not release claims information,” she told the board, stressing that the Trust makes its decisions in the absence of claims data. “For 21 years, the Trust has been consistent with this promise.”

The district had asked the Trust for general claims data on its Mat-Su members that could include, for instance, how much was paid out for cancer treatments, high-cost orthopedic surgeries, or catastrophic car accidents so that the district could determine whether it could afford to manage its own health insurance system in such a high-risk pool.

Exploring various health insurance options for district employees became a priority for MSBSD after a 25 percent increase in rates in one of three plans being offered by the PEHT this past year caused health insurance costs in the district to jump to $38.4 million and exceed the entire classified payroll by about $10 million, according to district budget reports.

Faced with an $11.2 million shortfall last spring for the 2018 school year because of a lack of funding at all levels, the district made the tough choice to cut 87 full-time classified, certified, and administrative positions, driving up class sizes at the secondary level from 28 students per middle school teacher to 30 and from 30 students per high school teacher to 32.

Additional cost-saving measures included decreases in nursing, foreign language courses, an increase in meal costs and activity fees, and the reduction or elimination of staff travel out of state.

A proposal to save the district nearly $2 million by outsourcing custodians and food services was shot down after classified employees and other community members protested vehemently last spring.

Now certified staff are pushing back after contract negotiations failed and the district filed an Unfair Labor Practice complaint against the union with the Alaska Labor Relations Agency in October for refusing to provide health claims information to the district.

“The district does not need our personal health claim data to shop around for health insurance,” Mat-Su Career and Technical High School Math Teacher Chad Finch responded in an email. “They have been told this multiple times from multiple sources. I believe it is a smokescreen to hide their true intentions of stalling bargaining indefinitely.”

Finch, a CTHS teacher for the past eight years, said he doesn’t trust the district to handle claims data impartially if they were to get a hold of it from PEHT.

“It is way too easy to identify users in our insurance pool, even with redacted information. These employees can be targeted to reduce costs,” Finch said, adding that he has been impressed with the way the PEHT has handled the employees’ insurance. “When have we ever seen a government entity handle money better than a private institution? Especially a non-profit private institution like the PEHT that has such a great history with finances.”

Finch pointed out that the district’s current director of finances, Luke Fulp, led Kodiak’s district into a self-insurance model when he was working there, and the results were not what Fulp had hoped.

“Not surprisingly, costs skyrocketed and now they have one of the worst insurances for any large district,” Finch said. “The school district should stick with what they know — education.”

This message was emphasized numerous times during the Dec. 6 school board meeting when more than a dozen teachers and community members spoke to the board. Many of them urged the district to return to the bargaining table with the union.

Colony High teacher Dianne Shibe told the board she thought it was unethical to ask for employees’ health claims.

“You’re holding teachers hostage because you want their health information,” Shibe said, urging MSBSD staff to do whatever it takes to help make this district attractive to others considering going into the education field.

In addition to the health insurance issue, MSEA is concerned about a district proposal to cut three contract days from the school calendar. This would save the district a little more than $1.5 million, according to MSBSD PIO Jillian Morrissey.

The district and the teacher’s union will be in contract mediation meetings Jan. 24 and 25 to attempt to resolve the impasse. If mediation doesn’t work, they will move to arbitration hearings.

This baffles MSEA President Tim Walters, who explained before Wednesday night’s school board meeting that health insurance had not been an issue in contract negotiations until just recently.

“They never asked to control the carrier before, so this is kind of an unusual assertion on their part,” Walters said as district staff and school board members milled around in a room now absent of any additional educators or community members. “My members have made it very, very, oh-so-clear that they don’t want the district’s fingers in our health insurance at all. We’ve looked at other large districts that self-insure. Fairbanks, for instance. Their insurance is over $7,000 more per person per year than ours is and they self insure. Kenai self-insures and they are over $2,000 more per person than our health insurance.”

Saul Friedman, the district legal representative at the bargaining table, explained Friday that the district merely wants to explore the prospect of self insuring and they can’t do that without gathering the claims information from the Health Trust. He said the district hopes that even the threat of getting fined by the Alaska Labor Relations Agency for unfair labor practices will convince the union to turn over the claims data.

Although school board members were advised to refrain from making comments to members of the media during contract negotiations, according to Board Member Debby Retherford, Retherford did say to Kitter during the Dec. 6 board meeting that the board feels it has a fiduciary obligation to explore all insurance options and the only way to do that is to gather claims figures.

“How can we be certain we’re getting the best deal?” Retherford said. “We need to investigate things.”

Retherford also urged everyone in attendance to contact their legislators to ask them to provide more funding to the schools.

Others in the community have questioned some of the district’s spending priorities when it comes to things like the Superintendent’s contract. Wednesday, the board approved Dr. Monica Goyette’s contract for fiscal years 2019 through 2021 for $168,269 per year for 250 work days, plus a Community Relations Expense Stipend of $417 per month, along with a monthly travel stipend of $450. "

When Finch was asked if he feels valued as a teacher in MSBSD, he simply said, “No.”