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SUNNY Temp: 86 °F Wind: NNW at 13 mph Tuesday, June 17, 2003 SECTIONS Home Page Local News Sports Business Obituaries Life Opinion - Politics AP News Weather Classified Archives Site Map EXTRA HomeLife Magazine W3 Magazine Jobs @ Mail Tribune Tempo A & E Oregon CarZone Wellness Connection Real Estate Newspaper in Education Prime Times Outdoor Journal Personals Movie Times TV Times E The People CLASSIFIEDS Find a Car Find a Home Find a Job Find Everything E SOUTHERN OREGON Automotive Communities Entertainment Publications Recreation Calendar ABOUT US FAQ What's New Advertise Home Delivery Classified Ad Contact Us Media Kit Email Story to a Friend June 1, 2003 State plan on school insurance debated Bill on health coverage raises monetary issues By DON JEPSEN for the Mail Tribune SALEM — A battle is shaping up over a bill that would establish a statewide group health plan for public school employees. Senate Bill 6, which has the backing of Gov. Ted Kulongoski, would create an Oregon Educators Benefit Board to provide pooled coverage. It will get its first hearing before the Senate Revenue Committee on Tuesday. Fighting the legislation is the Oregon School Boards Association, which has a virtual monopoly in underwriting local district health coverage through Regence BlueCross BlueShield. If passed, the bill would put the lucrative OSBA Trust out of business. Representatives from several Jackson County school districts had mixed reactions over the idea. Yvonne Fletes, board chairwoman of the Eagle Point School District — which pays the highest share of monthly premiums in Oregon at $1,070 — said she is not that familiar with the bill. Advertisement "But if it saves us money, I’m all for it," she said. Adds Eagle Point Superintendent Bill Jones, "It only makes sense to pool into one group." Juli Di Chiro, superintendent of the Ashland School District, takes a more cautious approach. "It’s a great idea — if it saves us money. I’m a little hesitant because the state hasn’t done that well with large-scale programs like this." The Medford School District self-insures. Board member Peggy Penland says that saves the district $1.4 million a year. She is opposed to the state stepping in. As written, the bill exempts districts that self-insure, most notably Portland. The sponsor, Sen. Ryan Deckert, R-Beaverton, said that provision probably will be stripped. "Senate Bill 6 takes away our choice," Penland said. "For me, it’s a local control issue." OSBA began offering pooled coverage in the mid-1960s. Its plan currently covers 33,000 employees in 204 school districts along with a smattering of community colleges and education service districts. About half of the association’s operating budget, or just under $2 million, comes from a 1.025 percent charge levied on gross premium. Deckert, who chairs the Revenue Committee, said a state-run health insurance program could save school districts up to $150 million a biennium in premium costs through "efficiencies of scale." Despite OSBA’s opposition, Deckert predicted the bill has a good chance of passing the Legislature. John Marshall, OSBA’s director of legislative services, said his organization’s group health plan provides the best benefit options at the lowest price. "Our experts say even if you make the pool bigger, it wouldn’t save money," he said. Marshall said figures being used by the governor’s office — $65 million in annual premium savings, according to James Sager, Kulongoski’s education adviser — are bogus. He predicted the Oregon Educators Benefit Account would turn into a union-run bureaucracy. "In 10 to 20 years, we could have another PERS (Public Employees Retirement System) fiasco on our hands," he said. Jones said escalating insurance costs may mean more staff cuts at Eagle Point if something isn’t done to rein in premiums. Rates are expected to increase by as much as 40 percent next year. Eagle Point is one of about a dozen districts in Oregon without a premium cap. So far, teachers have refused to negotiate a reduced contribution by the district. "With our fiscal situation, we simply have to bargain a cap," Jones said. Ashland caps its contribution at $474. The total premium is $797, leaving teachers paying $323 a month for health benefits. Di Chiro said teachers are happy with their coverage, "except for how much it costs them." Eagle Point and Ashland get their coverage through the Oregon Education Association Choice. Medford’s total premium is $780, paid by the district. However, employees will begin contributing $75 a month next year. Don Jepsen is a free-lance writer living in Salem. 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