The Broadalbin-Perth Teachers Association voted Tuesday in favor of dropping the costly Blue Cross Blue Shield indemnity health insurance plan, a contract concession that could save half of the teachers the district has targeted for layoffs.
Broadalbin-Perth Central School District Superintendent Stephen Tomlinson said the district’s school board will vote on the contract change at a special meeting at 7:15 a.m. Thursday. He wouldn’t disclose many particulars of the contract change other than that if accepted it would reduce health insurance costs by $322,000 and allow the district to save four to six teacher positions.
Broadalbin-Perth’s $27.9 million 2009-10 school budget approved by voters June 16 will cut 12 teaching jobs.
BPTA co-President Maura Hibbitts would not disclose her membership’s vote tally but said the majority voted to drop the plan as a means to save jobs.
During the budget process, Tomlinson said several times that the teachers union was unwilling to drop the indemnity plan, a change that would require them to renegotiate a three-year contract with the district. After voters rejected the district’s first budget May 19, Tomlinson said the district was getting closer to a deal with the union to save money and jobs.
Hibbitts said her union had attempted to offer other cost-saving measures earlier in the year but the district pressed them to drop the indemnity plan as the way to save the most money.
“We know the district is going through some very difficult financial times. I think it took a while for that message to really be made clear to the union … so I think once we had that realization, we looked at this more,” she said.
If approved by the board Thursday, the new contract would allow the district to offer the Blue Cross Blue Shield Preferred Provider Organization plan instead of the indemnity plan. The PPO plan would cost taxpayers and employees about $19,681 for a family of four for the 2009-10 school year. An indemnity family plan would cost $26,112. The national average family plan in 2008 cost $12,680, according to the Kaiser Family Foundation annual survey of health benefits.
Hibbitts said the deal her union approved includes taking about $70,000 of savings from dropping the indemnity plan — savings above and beyond the $322,000 used for restoring teacher positions — and using it to create a health reimbursement account. She said the account will be used for teachers and retired teachers who had the indemnity plan and had already reached the $2,000 lifetime maximum deductible offered.
“Some people would have to pay co-pays who haven’t paid co-pays before. This will help people make that transition,” she said. “Also, there are some differences between the two plans: there are some things that the indemnity plan covers better, there are some that the PPO plan covers better. So for some, there would be more out-of-pocket expenses, and this will help to cover that.”
Broadalbin-Perth is one of three school districts in Fulton County — all members of the Fulmont Health Trust Group, which collectively pays insurance claims from a premium pool — that have struggled to budget a 20 percent increase in costs for the indemnity plan for the 2009-10 school year. The Greater Johnstown School District’s health insurance bill was set to increase by $729,000, even after 13 teacher retirements. Johnstown had no layoffs but closed an elementary school to help contain costs. The district announced June 3 that it is unilaterally dropping the indemnity plan on July 1, a move district officials project could save $584,000 if it isn’t overturned by an arbitration panel.
The Gloversville Enlarged School District faced an $858,769 cost increase, which it cut to $552,000 after cutting 34 teachers, 16 other staffers, six vacant teaching positions and one administrative vacancy. The district’s bill for 2009-10 recently went up again by $280,000 to $832,000 after the Fulmont Health Trust Group increased the cost of the PPO plans by 10 percent.
Johnstown and Gloversville are both in negotiations with their teachers unions for new contracts. Contracts in the two districts run out at the end of the month, but state law mandates that contract provisions remain in place until new deals are signed.