Editor’s note: This commentary is by Anne Judson, of Burlington, who is Ward 4 commissioner on the Burlington School Board.
[O]ne of the outstanding negotiation issues still facing the Burlington School Board and teachers union for the fiscal year 2018 contract is health care coverage.
For decades, Burlington teachers’ health insurance benefits were purchased through the self-funded insurance pool Vermont Education Health Initiative, or VEHI. The VEHI board of directors and management staff are made up of school district and Vermont-NEA representatives. Presently, over 95 percent of Burlington teachers are on the 23-year-old VEHI-sponsored plan called the Vermont Health Partnership.
As a result of the 2010 Affordable Care Act, on Jan. 1, each teacher will select from one of four new plans offered through VEHI for their health insurance coverage: Platinum, Gold, Gold Consumer-Driven Health Plan, or Silver Consumer-Driven Health Plan. All four plans were designed and approved by the labor and management representatives on the VEHI board of directors. VEHI made sure each new plan would provide high-quality benefits to school employees, while reducing the cost of premiums. Premiums on the new plans are lower due to design tradeoffs between premium costs and out-of-pocket costs typically found in most modern health plans. Premiums are lowered, but out-of-pocket costs are increased, as a means to incentivize individuals to economize on health care expenditures.
The board’s proposals ensure that teachers do not pay more for health care under the new plans than under the old plans and reflect the view that any health care savings should be used to help fund teacher salary increases and other district needs.
Below, we provide some information that compares the old and new plans.
• Premiums for the new plans are approximately 30 percent less costly on average than the old VHP.
• The new plans offer the same BlueCross/BlueShield of Vermont state and national provider network as before, along with an expanded international network.
• There is no change in medical service coverage. All medical services covered under the VHP plan will also be covered under the four new plans.
• The new plans will have the same prescription drug formulary as the VHP with two minor exclusions approved by VT-NEA representatives on the VEHI board: sexual dysfunction and infertility drugs. This change is consistent with the Vermont Health Connect formulary.
• The new plan options will not require referrals to see a specialist and, as with the VHP, pre-authorization will continue to be required for certain procedures like MRIs.
The board’s overarching goal in developing its health care proposal was to ensure teachers continue to enjoy high quality affordable health care insurance. The board’s health care proposal to the Burlington Education Association in large part parallels the benchmarks in the recent teacher health care compromise just passed by the Legislature, called Act 85. This legislation set a premium cost contribution target of 20 percent for teachers, along with requiring them to cover $400 per covered life of out-of-pocket costs. School districts will be assessed a financial penalty if their negotiated plan does not at minimum conform to the state benchmarks. The union’s position is that the teacher contribution remain at 17 percent of the premium cost.
Provided teachers pick up some of the initial out-of-pocket costs as they presently do with the VHP (about $400 on average, according to VEHI), the board has proposed to contribute between $400 to $1,600 depending on household coverage levels into a health reimbursement account to significantly limit additional financial risk to teachers.
The board’s proposals ensure that teachers do not pay more for health care under the new plans than under the old plans and reflect the view that any health care savings should be used to help fund teacher salary increases and other district needs.
