Press-Republican

Education

October 15, 2013

No action on PCSD health-insurance

Superintendent encourages board, public to stay informed

(Continued)

The legislation calls for a tax to be placed on high-cost insurance plans, which Short noted, both Plan A and Plan B are considered to be.

The act mandates that once the cost of a plan’s individual coverage exceeds $10,200 and family coverage, $27,500, an excise tax of 40 percent of each dollar over those limits be applied.

“So depending on the cost of those plans ... we could end up, in about three years, being taxed on those,” Short said.

“Plan A is most certainly going to be there sooner because Plan A is about $4,000 per family plan higher in expense than Plan B.”

‘CONSTANT EVOLUTION’

In fact, Short added, there will come a day when Plan A will be unsustainable.

“It’ll either be highly taxed at a high 40 percent tax rate or so many schools (in the consortium) will have pulled out of it, there’ll be such a small group of people covered by Plan A it won’t be able to sustain itself as a health insurance,” he said.

It has become impossible for health-insurance plans to stay stagnate in today’s world, the superintendent continued, because of the additional costs that advancements in medical procedures and prescription drugs add to the mix.

And for that reason, he said, employee health insurance is something the board will likely have to re-evaluate every few years for years to come.

“Probably the most important note to point out is that this evolution is going to be constant ... health insurance needs to stay very much in your vocabulary (and) very much in our line of understanding because of the amount of change that’s taking place,” Short said.

“Eventually, whatever plan that we have is going to trip over that threshold of 40 percent,” board member Clayton Morris added at the meeting, “so we really have to start thinking creatively in terms of how we pay our employees and how we give them benefits.”

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