February 2, 2006 Outlook & Review (40k )

The OSBA Insurance Trust took an aggressive early step to help control rising health insurance costs for member districts at its Jan. 27 meeting in Salem – it limited the overall rate increase to no more than seven percent for the plan year that starts this October.

What this means for school districts: For the third year in a row, OSBA Insurance Trust plan members will see health-benefit costs rise less than 10 percent.

“This is good news for our members because the trust – which typically estimates renewal premium in early February – has never given a guaranteed maximum,” said OSBA Insurance Trust Committee Chair Craig Prewitt (Phoenix-Talent School Board). “This is especially timely for everyone’s budget planning process.”

Prewitt noted the trust normally sets the actual overall renewal rate for OSBA Trust-sponsored health insurance plans each May, with plan-specific premium announced in late June by Regence BlueCross BlueShield of Oregon.

“The even better news is that we’re hoping our final rate will actually be lower than seven percent,” Prewitt added. “The fact that we can manage premium increases for our members assures us we have a good reserve policy, which minimizes fluctuating rate increases that can wreak havoc on a board’s budget.”

The following are examples of past rate increases: 2000 – 19.3 percent; 2001 – 13.4 percent; 2002 – 26.1 percent; 2003 – 16.6 percent; 2004 – 9.3 percent; and 2005 – 8 percent.

In other business, the trust discussed a reserve policy that would maintain 10 percent of annual premium in reserve. Final action on the policy will be taken at the May 15 meeting.

The OSBA Insurance Trust is governed by five trustees appointed by the OSBA board. The trustees operate the trust independently from OSBA and maintain policy control and authority over plan design and premium rates. For 35 years, the OSBA Insurance Trust has competed on the open market; it provides 85 percent of OSBA members with competitively priced health insurance plans.

Besides Prewitt, trustees are Craig Roessler, Silver Falls superintendent; John Peterson, Hillsboro School Board; Jennifer Heiss, Creswell School District business manager; and Tom Bennett, Coos Bay School Board.