Issue #17: The current status regarding insurance premiums is still fluid. There is good news… and bad news. It’s a complicated situation, but here is the status of the insurance issue and how it affects budget discussions for FY 2010-11 as of February 25, 2010.
There have been many questions about insurance. There have been reports that premiums have “gone down.” That’s technically incorrect, with the exception of dental insurance which has declined from FY 2009-10 by approximately 2%, which isn’t much.
First of all, in an effort to find cost savings, the following have partnered together on medical insurance premiums: the Town of Marlborough, the Marlborough Board of Education, the town of Andover, the Andover Board of Education, the Town of Hebron, the Hebron Board of Education, and the RHAM Board of Education. In other words: the more people you have in your “regional organization/business,” the better the premium rates. That we all know.
Basically at the start of this year, give or take a few days, the “regional organization” was notified that insurance rates would be going up by between 17% and 18%. WOW!!! But if you are employed in the private sector, your employer has probably already told you about the same thing.
As of February 25, 2010, the increase in insurance premiums is down to an “across-the-board average” of 11.7%. If you want to nitpick, some of the agencies in the partnership have a 12% increase, while another agency has an 11.5%. But the average is 11.7%, and that is Hebron’s percentage increase.
This year, ALL insurance is going out to bid to try to find more savings: medical, worker’s compensation, and property/liability insurance. The latter two of those insurances have already gone out to bid, with medical to go out to bid soon.
To compound the picture, there was an error in calculating the Hebron Board of Education’s insurance increase – it was approximately $52,000 short. So either the Hebron BOE needs to cut $52,000 in their current budget increase request to keep it at a 3.99% increase, or their proposed budget will actually go up.
It is incumbent to remember, during budget season, that no one is “cutting budgets.” These are all requests for increases to current budgets. What is still unclear is why there is a BOE budget increase request at all, with a declining student population. With a declining population, one would logically ask: won’t those cost savings offset the increase in insurance premiums that we’re all experiencing?
We’re working on those numbers, so stay tuned!