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Kingsport schools may move to self-insured health care plan

Rick Wagner • Jul 9, 2013 at 11:29 PM

KINGSPORT — City school leaders are setting the wheels in motion for a possible move to a self-insured health care plan by Jan. 1, a move that would mean abandoning state of Tennessee health insurance offerings.

The Board of Education voted 4-0 with one absent to begin the process of switching to a self-insured program, although the matter would not become official until a suitable administrator and stop loss coverage is found and a majority of teachers vote for the switch. It would affect current employees and retirees who have not reached 65.

The move, following the lead of city government, is to result in savings that eventually will be passed along to employees, but in the meantime would allow school employees to participate in the new city employee clinic and for 2015 could reduce employee costs and eventually increase benefits.

Mark Morgan, a consultant with Sherrill Morgan, said the next steps are to have simultaneous negotiations to use the city framework with Humana as the administrator and HCC as the stop loss coverage provider as a request for proposals for an administrator and stop loss provider also would be due by Oct. 1. That way, he said, the school system at worst would have a fallback plan and at best might have two options from which to choose.

The system had a gap between premiums paid in and costs of almost $1.4 million for 2012-13, Morgan said.

Superintendent Lyle Ailshie said he wants to get as much detailed information to teachers and other employees as possible before the teacher vote and said a presentation with Morgan is likely.

The system would have to notify the state by Nov. 1 of the intent to pull out, and the new coverage would begin Jan. 1.

Morgan said with or without the city framework, the school system would remain a separate self-insured entity but would have access to the employee clinic that opened recently in the old Midland Center building on Fort Henry Drive.

He said advantages of that clinic are no co-pays for office visits, prescription drugs, some non-prescription drugs and lab work.

His full presentation is at http://kingsport.schoolfusion.us/modules/groups/homepagefiles/cms/940474/File/BOE%20Meeting%20Notes/2013%20Supporting%20Documents/7-9%20Self%20Funding%20Recommendations%20and%20Timeline%20-%20Sherrill%20Morgan.pdf.

In other action, the board:

•Elected Carrie Upshaw president of the BOE in absentia. Upshaw was the vice president and was nominated by Randy Montgomery, the outgoing president. Upshaw is attending freshmen and parents college orientation with her son.

•Elected Susan Lodal as vice president. Lodal is a former board president, active in the Tennessee School Boards Association and has been honored as TSBA’s school board member of the year.

•Recommended the additional expenditure of $83,270.65 for the Robinson Middle School parking lot resurfacing project to offset “blue muck” found under the old lot. The Board of Mayor and Aldermen approved the project as part of capital bonds it approved at its Tuesday meeting.

The parking lot money adds to the original cost of about $168,000. Maintenance supervisor David Carper said the projected completion date is about two months from now if the weather is not too rainy.

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