In Our View: Consolidate School Plans

Health insurance in public education could be made more efficient

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Hotly disputed Senate Bill 6442 in the Legislature would consolidate health care plans for public school employees. Among its claims are to “streamline the benefits array … to improve efficiency, transparency and stability; standardize coverage levels for more affordable and equitable health care benefits; and reduce costs by restructuring the health benefits array.” On face value, those goals sound reasonable and worth pursuing, especially in our cash-strapped state government. On deeper review, the proposed consolidation makes even more sense.To cast this dispute as a union-vs.-management showdown is not altogether accurate. It’s true, the bill is adamantly opposed by the Washington Education Association, the teachers union, which organized a crowd of about 500 protesters Monday at the Clark County Events Center at the Fairgrounds. It’s also true that the bill’s supporters include the Office of the Superintendent of Public Instruction, plus groups representing principals and administrators, or the management side of schools. But also among the supporters is Public School Employees of Washington, the union representing most school custodians, bus drivers and other uncertificated school workers.

A more productive exercise than studying the union/management argument is to listen to independent experts.

Among those experts on the education level we consider the OSPI, which is dedicated to the pursuit of education as the state’s “paramount duty,” according to the state constitution. If OSPI believes scattering 300 insurance plans and 1,000 insurance pools around the state’s 295 school districts is an inefficient way to do business, we would agree.

Among the independent experts on the financial level, we consider the state auditor, whose office believes consolidating insurance plans in public education could save as much as $90 million per year. That’s only an estimate, however. Other sources have estimated savings at $45 million.

It’s also instructive to examine what other states have done. According to a story by Jacques Von Lunen in Tuesday’s Columbian, Oregon instituted a plan similar to what’s being proposed in Washington and saved $125 million in the past three years. What’s more, the Oregon teachers union advocates preserving that system.

WEA officials argue that the proposed plan will reduce benefits and increase costs for teachers, and that up to $20 million could be required for startup costs of a consolidated system. Our response is to simply point southward. Consolidation seems to be working in Oregon. Also, there’s much to be said for the concept of efficiencies of scale, a powerful force in competitive bidding.

It’s encouraging that the proposed system would be overseen by a School Employees’ Benefits Board, with 12 members representing teachers and other groups in public education. The board would coordinate the bidding process among private insurers.

The Seattle Times opines that SB 6442 is “reasonable.” The Tri-City Herald says the argument that it would cost more to streamline “such a splintered offering of health insurance benefits” around the state “fails the sniff test.” The Spokesman-Review in Spokane editorialized that “the state should take back control and curb the administrative costs associated with managing so many different plans.”

All of that is true. The Columbian says consolidating the various school health insurance plans is good for both public education and taxpayers.