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School District Saves on Medical Insurance, Gives its Teachers $5,000 per Family in Health Coverage Savings


As Seen in BizTalk in the St. Louis Business JournalRecently, an independent insurance consultant was contacted by a school district in the region because the district administrators wanted “to give something back to their teachers.” The school district administrators had not formally shopped around to compare prices for their medical benefits in recent years, so they were curious about the competitive cost of the program. The district’s medical benefits were in a group risk-sharing program.

The independent insurance consultant helped the administrators select two new insurance brokers to get competitive quotes. The school district ultimately switched health care insurance providers, while maintaining the same benefits as previously offered under the group risk-sharing program. By switching providers, the district experienced a significant savings that was passed back to the teachers.

Additionally, the school district increased the schools’ contributions to the medical plan, which resulted in a total savings of $5,000 per family coverage for the teachers. This, in effect, was like giving a $5,000 raise — so the district accomplished its goal of giving something back to its teachers.

Maintain a Competitive and Efficient Insurance Package
School districts, like any other company or organization, cannot have a mentality of “set it and forget it” when it comes to their insurance. The following are three recommendations for assuring your insurance coverage is the best it can be:

  1. Consider a competitive bid for your medical insurance.
  2. Review your plan design to deliver better benefits. Many organizations overpay for insurance and do not have the time or expertise to perform their own insurance plan review to determine the appropriate insurance cost and coverage. An independent insurance consultant can provide an impartial insurance review to help you evaluate your options.
  3. Make sure you understand how the Affordable Care Act (ACA) will affect your plan in future years. The ACA’s “Cadillac tax” provision takes effect in 2018. As originally presented, the Cadillac tax would affect only especially generous plans. However, some analysts believe many non-exceptional plans will be affected in 2018 and, over time, it may impact almost every plan. The Cadillac tax will likely add a significant challenge to many employers’ efforts to control health benefit costs. A recent survey by Mercer, a global consulting firm, predicted that approximately one-third of employers will see their plans hit by the Cadillac tax in 2018.

This school district was able to give their teachers a $5,000 benefit because they hired an independent consultant to help them accomplish their goal.

Bill Goddard, CPCUIf you have concerns about your insurance coverage, complete the adjacent form to schedule an independent insurance review with Bill Goddard, Principal, Insurance Advisory Services.


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