School system facing $2.2M hike in insurance costs by 2014

Members of the Decatur County Board of Education were left scratching their collective heads after receiving more bad budgetary news.

During Thursday night’s regularly scheduled meeting, the board was informed that health insurance costs for non-certified school system employees were set to increase by $500 per month per employee by fiscal year 2014. This increase is the employer portion of the premium, and it is unknown if the employee portion of the premium cost will increase as well.

According to Chief Financial Officer Tim Matthews, there are 391 non-certified employees with insurance.

At the beginning of the current fiscal year, the system paid $246 per month per non-certified employee for health insurance. Three months ago, the system was informed by the Georgia Department of Community Health, the governing body of the state’s health insurance program, that the premium would increase to $296 monthly immediately.

Beginning in July with the new fiscal year, the cost will increase to $446 monthly, increase to $596 monthly in 2013, and increase to $746 monthly in 2014. The cumulative increases represent a $2.2 million increase in health costs to the system for non-certified, or non-teaching, positions.

School Superintendent Dr. Fred Rayfield explained that the justification for the increase was the large gap between payment of claims and collection of premiums among non-certificated employees.

“Statewide, certificated (teachers’) claims versus premiums usually runs in the black, there’s enough money there to pay the claims,” Rayfield said. “Non-certificated claims versus premiums are running $431 million in the red. That’s the justification for the massive increase.”

Rayfield went on to explain that the system was not compelled to use the state health benefit plan and was free to shop the market for a replacement health plan for non-certified employees. However, Rayfield is doubtful that would be an acceptable option.

“If we go out and shop for another plan for non-certified employees, the options aren’t going to be very good. Right now, the premiums are based on a state-wide group size compared to an individual county group size; we’ll lose a lot of bargaining power,” Rayfield said.

With the inclusion of this cost increase, along with other increased costs and decreased funding, the projected gap in revenues and expenses will be $4.6 million for the 2013 fiscal year, beginning on July 1, 2012.

In other actions, the board voted for Dr. Sydney Cochran to remain as chairman of the board and Jacky Grubbs was voted to return as vice-chairman. Both votes were 5-1 with Clarissa Kendrick casting the “no” vote in both instances. The board voted unanimously to re-appoint Bruce Kirbo Jr. as board attorney.

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