|
P.O. Box 909 ● Trenton, NJ 08605-0909 ● Phone: 609.695.7600 ● Fax: 609.695.0413 ● Web: www.njsba.org/PI |
NEWS RELEASE CONTACT: Frank Belluscio (fbelluscio@njsba.org) FOR IMMEDIATE RELEASE Ability to Negotiate Health Coverage Will Save Tax Dollars – N.J. School Boards Association NJSBA Testimony on Health Benefits Reform CLIFTON, September 19, 2006--Negotiating with unions to contain the cost of health benefits has enabled some school districts to save over $1 million a year, representatives of the New Jersey School Boards Association told a legislative panel exploring property tax reform today. The ability to bargain over aspects of health benefits, however, is not available to school boards that secure coverage through the New Jersey State Health Benefits Program, explained Passaic County School Boards Association President Marie Hakim to the Joint Legislative Committee on Public Employee Benefits Reform. Just under 40 percent of New Jersey’s school districts use the state plan, with a large number concentrated in Bergen, Passaic and surrounding counties. State regulation precludes these districts from negotiating levels of deductibles and co-payments, employee contributions to premium, placement of new employees in managed-care systems, and other aspects of coverage. Such strategies are common among school districts that use private insurance carriers. However, the high-cost New York-area insurance market, as well as contractual requirements, leaves many northeast New Jersey districts with no option but the state plan. Therefore, the best cost-saving solution would be to give SHBP-member districts the ability to negotiate provisions to control health benefit costs. Savings to Taxpayers Clifton is one district that opted for private health insurance, in 1996, and has been reaping savings, according to Hakim, who has served on the city’s school board for 16 years. That move saved the school district $1.5 million in health insurance costs within the first year. “In our latest round of negotiations, we saved $1.2 million,” she explained. Hakim pointed to other New Jersey school districts that have experienced substantial savings. ‘Unreasonable’ Restrictions Hakim noted that the largest chunk of taxpayer-funding for schools (75 percent) is spent on salaries and employee benefits, with health coverage presenting the most rapidly escalating employment cost. Noting this statistic, Richard Snyder of the Ramsey Board of Education urged the committee to back legislation that would give SHBP-member school districts the same ability to negotiate cost-saving provisions as is now possible through private coverage. Hakim also pointed out that current SHBP regulations treat school districts differently than the state government, which has significant cost-containment options. These same options, however, are not available to school districts, a situation that Hakim termed “unreasonable” and one that shortchanges property taxpayers. Increase Competition Giving flexibility SHBP-member school districts the ability to negotiate aspects of health coverage would make the state plan more competitive with private carriers, attracting school districts back into the program, according to the NJSBA. “Nearly 500 school districts were enrolled in the state plan in the early 1990s,” noted Snyder. “By the end of the decade, only 276 remained.” Today, only 239 school districts participate in the state plan. To increase participation in the state health plan, some legislators have considered measures that would simply require that all school districts enroll in the SHBP. Hakim cautioned lawmakers not to take that route. “Such an action would completely remove any competition in the healthcare benefits insurance industry and do the exact opposite of saving taxpayers’ money,” she explained. “By making the SHBP the only game in town, or in the state, the costs of health benefits would go through the ceiling.” In addition to serving on the Clifton Board of Education and as Passaic County School Boards Association president, Hakim is the 2006 New Jersey School Board Member of the Year. Snyder, of the Ramsey Board of Education, represents Bergen County as an alternate member of the New Jersey School Boards Association’s Board of Directors. ********
The New Jersey School Boards Association, a federation of district boards of education, advocates the interests of school districts, trains local school board members, and provides resources for the advancement of public education. ###
|
