What's the history behind the new Oregon Educators Benefit Board?

The 2007 Legislature passed SB 426 to establish a statewide insurance pool for employees and retirees of school districts and education service districts (ESDs). Oversight and management of the insurance pool will be performed by the Oregon Educators Benefit Board (OEBB).

When did the law take effect?

March 21, 2007. SB 426 included a provision declaring an emergency so that the bill became effective upon passage. Under Oregon law, "passage" refers to the date the governor signs the bill into law, which was March 21.

What is the make-up of the OEBB?

The OEBB has 10 members appointed by the governor and confirmed by the Senate: two representing school and ESD boards; two from district management; two representing employees from the largest labor organization, Oregon Education Association; one from the second-largest labor organization, Oregon School Employees Association; one representing non-management employees not represented by a labor organization (confidential and/or supervisory staff); and two with expertise in health policy or risk management. Each will serve a four-year term. Current members:

• Michael J. Cannarella, AFT Faculty & Classified, Portland Community College 
• Mylia Christensen, assistant director of operations and planning, Oregon Health and Science University Center for Evidence
• Richard T. Clarke, human resource officer, Portland Public Schools 
• Ron A. Gallinat, board member, High Desert ESD Board 
• Thomas A. Husted, field consultant, Oregon Education Association
• Alison S. Little, M.D., medical director of the Drug Effectiveness Review Project Center for Evidence-based Policy, Lake Oswego 
• Steve H. McNannay, executive director of Oregon Education Association Choice 
• Victor S. Musial, field operations director for Oregon School Employees Association
• Peter M. Tarzian, superintendent, Falls City School District; board member, Linn-Benton-Lincoln ESD
• Brett M. Yancey, chief financial officer, Springfield School District

When will the OEBB be formed and staff on board?

The hiring of OEBB staff was addressed by Oregon's Department of Administrative Services (DAS) through Jean Thorne, Public Employees Benefits Board administrator.

Thorne will oversee implementation of the program. The budget associated with SB 426 established staff positions, including a deputy administrator. Denise Hall was brought on through a job rotation to serve as the interim deputy administrator. Her first tasks were to begin outlining the work for the board and the program. Hall is the manager of HR Systems, Service and Audits in the DAS Human Resource Services Division. She has a background in HR administration with the state, including working for the former State Employees' Benefit Board.

What are the duties of OEBB?

The OEBB designs benefit-program choices, identifies and selects carriers to provide the benefit programs, and determines employee eligibility and participation requirements. The OEBB is charged with considering the welfare of participating employees and the affordability of the benefit programs to participating employers. 

What criteria will OEBB use to choose carriers?

The OEBB is to emphasize (1) providing employees with choices among high-quality plans; (2) encouraging competition in the marketplace; (3) plan performance; (4) quality of customer service; (5) creativity and innovation; (6) plan benefits as a part of total compensation; (7) improvement of employee help; and (8) district flexibility in plan design.

What obligations does OEBB have in developing and offering insurance plans?

The OEBB is required to offer a range of benefit-plan designs to ensure that when benefit plans are first provided to districts and employees, the parties will be able to choose plans comparable in design and equal to or less in cost than the benefit plans provided by districts immediately prior to joining the OEBB. OSBA has offered its 40 years of Health Insurance Trust experience to help in this effort.

What kinds of benefit plans will OEBB provide?

In addition to health and dental benefit plans, OEBB must ensure that a long-term-care benefit plan is available to eligible employees and family members. It may also provide life, accidental death, disability, supplemental medical, supplemental dental, and/or supplemental vision.

Which employers are required to participate in OEBB?

Common school districts, union high school districts and education service districts are required to participate in OEBB; community colleges are not required to participate but may if they choose to.

Who may join the new insurance pool?

Eligible employees:

• Officers and/or employees of the district who decide to participate in one of the benefit plans provided
• Officers and/or employees who are receiving or are eligible to receive pension or disability retirement payments under the Public Employees Retirement System (PERS) or Oregon Public Services Retirement Plan (OPSRP)
• Officers and/or employees who are receiving or are eligible to receive a service retirement allowance, disability or retirement program offered by the district

Who is not eligible to join?

Independent contractors and individuals who fill positions on an emergency, irregular or intermittent basis or who are employed less than half-time, unless the position is considered a job-share position or the individual meets the definition for eligibility under OEBB rules or a collective bargaining agreement. 

Are there any exceptions to participation in OEBB?

Yes, there are some exceptions to participation in OEBB. 

For districts that were self-insured or had an independent health insurance trust as of January 1, 2007, their premiums  must be equal to or less than the premiums of comparable benefit plans provided by OEBB for their exception to continue beyond October 1, 2010.

Employees of a school or education service district represented by a collective bargaining agreement that ends July 1, 2007-June 30, 2008 must participate in the benefit plans provided by the OEBB beginning October 1, 2008. 

Employees of a school or education service district represented by a collective bargaining agreement that ends July 1, 2008-June 30, 2009 must participate in benefit plans provided by the OEBB beginning October 1, 2009. 

Employees of a school or education service district represented by a collective bargaining agreement that ends on or after July 1, 2009 must participate in benefit plans provided by the OEBB beginning October 1, 2010. 

If the district's collective bargaining agreement expires after October 1, 2010, the district must join OEBB beginning October 1, 2010. These same rules apply if the district has a contract with an insurance carrier instead of, or in addition to, a collective bargaining agreement.

What impact does SB 426 have on non-represented employees such as administrators, supervisors and confidential staff?

Employees of a school or education service district not represented by a collective bargaining agreement must participate in benefit plans provided by the OEBB when the represented employees at the same school district or education service district begin participating in the OEBB plans, according to timelines, above. If there is more than one collective-bargaining-agreement contract in existence at that school district or education service district, the earliest collective bargaining agreement to expire must be applied. 

Another limited exception may occur when the employee is covered by an individual employment contract in place before March 21, 2007. For the employment contract to potentially act as a exception to participation in OEBB, it must include provisions requiring the district to provide a specific insurance program by a specific insurance carrier. Even under these circumstances, it still may not provide an exception to joining OEBB if the programs required by the employment contract can be provided by a substantially comparable program through OEBB.

Will there be any review or study of the effectiveness of the OEBB? 

SB 426 creates the Task Force on Educator Health Benefits effective July 1, 2011. The task force will consist of six members: one from the Senate, one from the House of Representatives, one who is a district employee represented by a labor organization, one who is a district management employee and two who are not OEBB participants and who have expertise in health-insurance benefit-plan design or administration.

The task force will review the benefit plans and administration provided by OEBB to determine any cost savings resulting from the mandatory pool. 

A report, including recommendations for proposed legislation, shall be submitted no later than October 1, 2012, to an interim committee on education or public employment.

Note: This is not the official OEBB site provided through the State of Oregon. Our site provides updates on the OEBB to keep our members informed about this new program. The official OEBB Web site is now online.