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Hempfield seeks review of health care with teachers

| Tuesday, June 24, 2008

Hempfield Area school directors want to meet with the district's teachers union this summer to review a health care proposal the board president thinks could save the district hundreds of thousands of dollars.

Teachers say they are skeptical of the proposal -- which wouldn't immediately change their benefits -- because they maintain it will cost Hempfield more in the long run.

The proposed implementation of a high-deductible plan with a health reimbursement agreement, or HRA, is one of the main topics the school board and teacher representatives might discuss.

Board President John Henry is suggesting the meeting as a means to try to get both sides to work together.

Relations have been strained in the past two years, as a divided board approved a five-year labor contract last year and curriculum restructuring approved this year eliminated 15 administrative and teaching positions.

As the board prepared last week to pass a 2008-09 budget that raised taxes by 1.7 mills, Henry said Hempfield might be able to cut costs by switching to an HRA that would pay an employee's deductibles and qualified medical expenses that don't count toward the deductible.

Under this arrangement, the district's provider, Highmark, would credit 16 percent of Hempfield's $7.67 million health plan premium into an account for those expenses.

Because utilization historically has been between 40 percent and 60 percent, Henry said, the district could save some money because the unused credits carry over into the following year.

The district's consultant has projected that 40 percent utilization of the estimated $1.26 million fund would save $727,965, while 60 percent utilization could mean a savings of $476,165.

"Even if we go 80 percent, we still save $200,000," Henry said. "It's a no-brainer."

But Hempfield teachers sought an opinion last spring from a researcher for the Pennsylvania State Education Association, who insists Highmark would impose "massive increases in future premiums" after a one-time savings from the HRA implementation.

Besides, the switch to an HRA comes with a $32,225 fee for the administration of the same benefits teachers already receive, according to a PSEA memo.

Joe Scheuermann, president of the Hempfield Area Education Association, said teachers don't want to see the district socked by a huge premium increase.

"If you can save $600,000 and give us the same health care, God bless you, but where is the savings coming from?" he said.

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