Public-school Employees Embroiled in Insurance Issues

It seems likely a lot of teachers in Northwest Arkansas are giving the national health care debate the kind of undivided attention they covet from their students.

That’s because, despite a $15 million windfall realized earlier this year, health insurance premiums for teachers — and all public-school employees — remain grossly more expensive than those of full-fledged state employees. Depending on their choice of plan, public-school employees can pay more than $8,600 annually on family-coverage premiums, while state employees pay barely more than $5,000 for the same coverage.

“We lobby hard for that,” Arkansas Education Association president Donna Morey said of narrowing the gap between the respective premiums. “I wish we could do more.”

State Rep. Bill Abernathy and other legislators have been trying to help. Their efforts last spring resulted in $15 million from the state’s uniform rate of tax fund being directed to the state Employment Benefits Division for public-school employee insurance.

That money prevented an increase in premiums for the current academic year, and Abernathy and other legislators have said they expect the $15 million to be included in next year’s budget, too. Still, with some insurance premiums regularly jumping 8 to 9 percent per year, that money won’t stymie rate hikes for long.

Why the rates are so high in the first place seems to be a mystery to all parties involved. Part of the problem is there are two different sections of Arkansas Code when it comes to employer contributions for health insurance — one for state employees and another for public-school employees.

The reasoning appears to be that, despite the fact they adhere to the state’s Department of Education ethics policy and its licensing program, public-school teachers aren’t considered state employees because they “hold contracts with (individual) school districts,” Morey said.

The districts receive operational funding from the state, which requires the districts to pay $131 toward monthly health insurance premiums for participating employees. And while EBD executive director Jason Lee said about half of the state’s districts pay more than that amount — including a few like Little Rock School District, which pays entire premiums, according to Morey — AEA regional representative Bob Gettino said none of the districts in Northwest Arkansas contribute more than about $200 per month.

Lee said about 70 percent of public-school employees eligible for health care benefits participate, leaving a large group of dissatisfied educators. That much was evident in January, when a parade of about 20 vehicles carrying Springdale teachers joined others from around the state to address the problem in Little Rock.

Retired public-school employees yet to meet Medicare requirements face even more astronomical rates. Under one popular plan, such a retired public-school employee would pay more than $6,300 annually for an individual policy, and nearly $23,000 for family coverage.

This is especially distressing given the fact the average pay for retired teachers in Arkansas is about $19,500 per year, Abernathy said.

“I think this is a big problem for our teachers and our kids,” he added. “Some of them are not able to teach like they should, but they can’t afford to retire.

“We have some teachers in the classroom that don’t need to be there.”

Whether a more permanent solution, absent national reform, can be found remains to be seen. While national studies have indicated most companies pay about 75 percent of employees’ premiums, Abernathy said, Arkansas’ public-school employees receive a contribution of about 58 percent.

“There’s just no easy answer,” Morey said. “That’s why they’ve been fussing about it for so long.”

State Sen. Shane Broadway has heard the “fussing,” and is among a group of legislators currently exploring possible remedies. He said a permanent fix could require between $60 million and $100 million annually, depending on the source of the estimate.

“There’s a lot of different pieces to the solution,” Broadway said. “We’re trying to take it one bite at a time.”

Abernathy said he understands public-school employees’ mounting frustration with the lengthy and arduous process of figuring out a fix.

 “We’ve got a national problem, and heaven help us getting into that discussion,” Abernathy said. “But we live in a nation of prosperity, so how can we not have affordable health insurance for our people?

“I think something has to be done on a national scale, and then hopefully that will trickle down to our teachers.”

Broadway believes Arkansas’ state government and individual school districts must be part of the solution, too. And where will the state’s public-school employees look for relief in the meantime?

All of the above.