A week after passing across-the-board raises for district staff with new money from House Bill 3, Northside Independent School District trustees approved a health insurance plan Tuesday night that will cost the district 5.8 percent more.
However, not all of the cost increase will be passed on to the more than 10,000 people enrolled in the plan, NISD Director of Benefits Chris Rice said. Depending on the employee’s chosen insurance plan and the district’s contribution, the cost increase for employees will vary.
As most of the compensation conversation this summer has focused on salary increases made possible by new revenue from an omnibus school finance bill, some teachers have cautioned that health care benefits are an important component of the overall discussion that should not be forgotten.
There will be no changes to deductibles or out-of-pocket maximums and the district will maintain its 70 to 30 ratio for employer and employee premium cost sharing.
An increase of 5.8 percent is fairly normal, Rice said, noting that it may be one of the lowest year-over-year increases in recent years. Last year, the district saw an almost 8 percent increase.
Ninety percent of Texas school districts responding to a Texas Association of School Boards 2018-19 survey reported their health insurance premiums increased in 2018-19. In 2017-18, 95 percent of districts reported the same. Northside ISD will spend almost $100 million on health insurance costs in the coming school year, Superintendent Brian Woods said Tuesday evening.
Woods mentioned that the new money Northside received from House Bill 3 could also go toward health insurance costs and still fulfill a state mandate that requires the money be used on compensation increases. The district chose to not use the money in this area, he said, and approved across-the-board raises of 4 percent and 4.75 percent.
North East ISD administrators discussed a similar tradeoff in June when trustees passed that district’s budget. NEISD officials noted that HB3 funding could be used for health insurance costs but didn’t elect to do so when it came time for a vote.
NEISD, San Antonio’s second-largest district, runs a self-funded health insurance plan, which means the district pays out its employees’ claims. About 75 percent of NEISD employees use district insurance, a number that is similar to Northside’s participation rates. Approximately 8,800 NEISD employees are enrolled in the district’s insurance plan.
At a June board meeting, NEISD trustees approved a health insurance plan with no increases to premiums. However, the district projected a shortfall of close to $3.4 million from health care costs because of increased pharmacy expenses and medical costs.
To mitigate this budget gap, NEISD said it will explore changes to its policy on out-of-network emergency coverage and alterations to its pharmacy plan design.
Northside ISD officials have studied the feasibility of offering a self-funded plan in the past, but decided against it because of significant startup costs associated with such plans, Rice said.
Open enrollment for Northside employees begins in October.