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Home / Industry / Education / RCSD, unions agree to new insurance plan to save $41 million

RCSD, unions agree to new insurance plan to save $41 million

The Rochester City School District and its four employee unions have reached a deal on a new health insurance plan expected to reduce costs by $41.4 million over the next three years. The plan, provided through Excellus Blue Cross Blue Shield, takes effect Jan. 1, 2010.

Under the plan, the district is no longer in a community-rated insurance program, in which costs are influenced by the health care needs of numerous employers participating in the program, officials said. Instead, the new plan is experienced rated, meaning costs are determined by the district’s health care claims experience.

The plan will reduce health insurance premiums for employees while expanding benefits, such as extending the age limit for coverage of dependent children in college from 23 to 25, increasing reimbursement for eyewear, reducing co-pays for mail-order drugs and introducing a wellness plan that gives monetary rewards for living healthy lifestyles, officials said.

Employees and retirees will receive details about the new plan in November during the health insurance open enrollment process. Unions also will provide information during membership meetings.

“This plan allows the district to take control of its own health insurance costs, which represent the fastest growing portion of our budget each year,” said Jean-Claude Brizard, RCSD superintendent of schools. “It’s an example of the tremendous power of collaboration between the district and its unions, with everyone working together to do what is right for employees, right for the district and right for taxpayers.”

In announcing the plan Monday, Brizard was joined by the leadership of the Association of Supervisors and Administrators of Rochester, Board of Education Non-Teaching Employees, Rochester Teachers Association and Rochester Association of Paraprofessionals.

The district provides health insurance to approximately 6,300 employees and 3,000 retirees and paid $70 million in 2009. With no change, the cost of the plan would increase to approximately $80 million in 2010 and an additional 15 percent to 20 percent each subsequent year, RCSD officials said.

Under the new plan, the district will pay approximately $66 million in 2010.

Increases will be capped at a maximum of 9.7 percent in 2011 and 9.8 percent in 2012.

(c) 2009 Rochester Business Journal. Obtain permission to reprint this article.

One comment

  1. It looks like expanded benefits are in. What happens to premiums after 2012 under an experience rating system if claims go up?

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