A new report says Washington could improve health insurance coverage for many public school employees by merging the state’s existing patchwork of 200 plans and 1,000 insurance pools that vary town to town.
But there’s a big catch: The report, done by the state Health Care Authority at the Legislature’s request, shows the state would have to shell out at least $20 million upfront to consolidate the $1 billion system starting in October 2013.
Such costs complicate what has become a louder and louder campaign by Republicans and moderate Democrats in the Legislature to consolidate the health systems that serve about 200,000 workers and dependents in 295 school districts and nine education service districts. Lawmakers face a budget gap of $1.5 billion when they return to Olympia Jan. 9.
State Sen. Steve Hobbs, D-Lake Stevens, said Thursday he is drafting legislation to merge the health plans. In his view, it makes financial sense over the long term. Shorter term, consolidation evens out the coverage available to custodians, part-time lunchroom workers, paraeducators and teachers, he said.
“This is a time for reform. This is a time to see if we can make our dollars stretch. The current system simply does not make sense,’’ Hobbs said. Bus drivers and lunch room workers “are just as deserving of health insurance as anybody else in the K-12 system.’’
House Ways and Means Committee Chairman Ross Hunter, D-Medina, hadn’t read the HCA report but noted that Oregon saved $50 million from a consolidation. Richard Onizuka, the authority’s assistant director for health policy, said the authority didn’t have enough data to get a good estimate of the potential long-term benefit in Washington.
The Washington Education Association, which represents 82,000 school employees including teachers, flatly opposes consolidation. It says a merged system is more costly and could create new risks for school districts.
“The underlying premise this will save taxpayers money is false. It will cost more. It will reduce competition and turn it over to a bureaucracy,’’ WEA spokesman Rich Wood said recently, arguing that the state pays more for a consolidated health insurance system for state workers than it does today for teachers.
Premera Blue Cross, which works with WEA to provide a state plan with a single rate available for all school districts that choose to participate, also opposes the consolidation and says that comparisons to Oregon are misleading.
“What Oregon moved to is a system like the WEA plan ... in terms of one statewide rate,” Premera spokesman Eric Earling said. Republican Rep. Gary Alexander of Thurston County shares Hobbs’ interest in a consolidated K-12 health system. A state auditor’s report estimated a single system could save $90 million a year, and Alexander penciled in as much as $40 million in savings in last year’s GOP budget offer based on such a reform.
“At this point in time, I believe this is a reform measure that merits serious discussion,’’ he said.
The consolidation effort is dividing workers in the K-12 school system, just as the current system treats some better than others.
The Public School Employees union that represents many classified school workers who struggle with the costs of the existing health care plans is fully behind consolidation.
State schools Superintendent Randy Dorn, who is a former PSE leader, agrees, saying consolidation could improve coverage for many in the K-12 system. Dorn and Hobbs both joined a recent PSE-sponsored teleconference with reporters to make that point.
Dorn said some teachers pay little or nothing for single coverage, but rates soar over $700 a month for some classified workers who want to cover their families.
Kevin Kintz, an 18-year veteran teacher from the Bethel School District, said he and his wife pay $1,093 a month out of pocket for full health coverage. Kintz said reform is needed to cover teachers, substitutes, janitors and others “so we don’t feel like we’re working for our health care.’’
Annie Copeland, a technology support specialist at Yelm Community Schools, said it is worth helping others in the system even if a consolidated plan ends up costing her a little more.
Democratic Rep. Kathy Haigh of Shelton, chairwoman of the House Education Appropriations and Oversight Committee, predicts a full debate on the reform.
“I think there is room for discussion here ...” Haigh said. “My concern is what is there and what works for the average teacher out there.’’
Brad Shannon: 360-753-1688 firstname.lastname@example.org www.theolympian.com/politicsblog