All about the savings: School board eyes potential health insurance switch

With an almost 5% proposed budget increase on the table for the 2018-19, Ridgefield schools are looking at ways to create savings to offset future costs.

Similar to past budget deliberations, the top potential saver is changing health insurance providers. The Board of Education will discuss that switch at its meeting tonight — Monday, Jan. 29.

Health benefits consultant Rob Fitzpatrick, of Brown & Brown Insurance in Rocky Hill, will be in attendance to answer the board’s questions.

The meeting will not offer an opportunity for public comment. There will be several public hearings regarding Superintendent Karen Baldwin’s proposed 2018-19 budget in February.

Back and forth

Baldwin has proposed an operating budget of $97,110,435 — good for a 4.83% increase — for the 2018-19 school year. The budget plan will go to the voters in March.

Baldwin said the main drivers of the proposed $4,476,891 increase are health benefits (an additional $1,427,889), salaries ($1,288,425), and special education costs ($987,860).

She acknowledged that the budget had been written “coming out of a very challenging budget climate.”

One area of risk Baldwin identified in her budget proposal, however, is the potential for health insurance costs to go over what the new budget proposes. Her proposal outlines a 10% increase in insurance rates, but talks with Anthem indicated that renewal rates could be closer to 15% — some $713,945 more than the proposed budget allows for.

“We did a lot of hard work last year in order to reduce the health insurance line, and we changed carriers,” Baldwin said.

The district went from Cigna to Anthem last year.

Ridgefield schools may once again consider doing so as a way to rein in the cost of health care. Doing so won’t be as simple as checking a box. Because of the district’s collective bargaining agreements with teachers’ and faculty unions, Baldwin explained, the board would have to prove that a switch to a different insurance carrier is “substantially equivalent” to the current services provided by Anthem.

Also impacting health insurance costs are seven claims from within the district that meet the district’s “stop loss threshold.”

“We pay up to the first $200,000 for any claims for any member, whether it’s a teacher, a spouse, or a dependent child,” Baldwin said, explaining the district’s current health insurance policy through Anthem. “Right now we have seven claims beyond the stop-loss, and they’re totaling over $1 million.”

Those seven claims have come in since the district switched to Anthem at the start of July of last year, which is affecting the cost of renewing the health insurance benefits for the district.

“It’s obviously really unfortunate,” Baldwin said. “We have sick people within the organization, or spouses, and you know — that’s a crisis situation, whether it’s for the individual, or for their family.”

The board intends to discuss budgeting for health insurance with Fitzpatrick Monday night.

“The key idea here is that there’s risk in this budget,” Baldwin said.

Special education

The new budget also introduces changes to the district’s special education program, which Baldwin said had been “strained” in recent years. Spending on special education services would increase by $987,860.

Particularly troublesome has been the increase in special education settlements with parents. The budget projects 21 such settlements, and Baldwin said the district is creating a group to study the problem.

“We need the settlements in general to go down … so that we’re not faced with the budget impact that we are now,” said Baldwin. “This is a priority area for us.”

The budget asks for $1,251,575 in anticipation of settlements, up $432,575 from last year.

Also of concern was the number of students whose special education plans required that the district place them in another school system capable of meeting their needs. The district currently has 23 such students, a budget item of $2,353,107, or $322,961 more than last year.

New staff

Another major driver of the budget is salaries, both of certified and non-certified staff.

Baldwin told the Board of Education at its Jan. 22 meeting that certified salaries make up 49.1% of the total budget, with non-certified salaries at 10.7%. Employee health benefits are the second largest component of the proposed budget, at 20.3%.

The budget proposal asks for new certified staff: three special education teachers, two school psychologists, two middle school math specialists, one behavior analyst, and a part-time speech and language therapist. It also calls for the reduction of one elementary teacher position, six part-time art teachers, two high school English teachers, and an entire seventh grade team at East Ridge Middle School (five full-time teacher positions).

“There’s a snake in there,” quipped board Vice Chairman Doug Silver, after Baldwin’s presentation.

In total, the proposed budget reduces certified head count but not by a full-time position.

Baldwin acknowledged that there is some risk in the budget, as the plan calls for reducing one full-time elementary teacher. For the past three years, the schools have had to hire additional teachers out of budget in order to break class sizes. This year, three extra teachers were hired over the summer to break classes at Barlow Mountain and Veterans Park elementary schools.

The budget also makes changes to non-certified staff positions. That would mean adding at least one full-time lunch and recess supervisor, a part-time bus supervisor, two full-time special education paraeducators, and one athletic program assistant (who would only collect benefits).

The plan would also reduce a full- and part-time math paraeducator for the middle schools, two tech paraeducators, and more than two full-time clerical paraeducators.

Non-certified staff would see a net reduction of two full-time positions.

Other districts

Baldwin said the district is “not alone in this work” in terms of the amount of money it has requested for next year. The Easton-Redding (Region 9) school district requested an 8.97% budget increase for next year, she said.

The amount of money spent on each student is also below that of the other districts of similar socioeconomic standing, her report stated.

Silver noted he was uneasy about the prospects of cuts being made to the budget. “This is going to happen really quickly over the next couple of months,” he said. “I am really nervous.”

Chairwoman Fran Walton noted that the budget request was “totally out of alignment” with the 2.5% spending cap that had been suggested at the tri-board meeting in December.

Cutting the budget down to that size would be significant, she said. “A 1% cut is $926,000, just so everyone is clear,” she said.

“This could be profound,” said Silver.