Rising health care costs are crippling the Highlands County school district and the use of reserves for those rising costs hasn’t helped.
Over the last few years, the district went from having a surplus in its health funds account to having a negative balance. To pay its bills, the district had to siphon $8 million from its reserve budget. This didn't completely solve the problem.
The balance is now below the minimum threshold set by the state. That means unless the district can come up with major cost-saving initiatives, the state board of education will take over the rural school district's financial books.
The school board has been meeting regularly with the superintendent to discuss possible measures. On Wednesday they were presented with a plan that could blunt the losses.
The Highlands County School District’s employee insurance plan is self-funded. That means the district assumes the financial risk of providing health benefits to its employees.
Self-funded is designed to save money. In an effort to keep costs low for everyone, the district has its own medical clinic with negotiated payouts that are less expensive than a other medical providers. This is supposed to be a win-win for all parties because employees aren’t saddled with large co-pays and deductibles if they use the district's clinic.
Not everyone uses the clinic. It is used in about 40 percent for all medical visits. This can be for a variety of reasons, for example, the district's clinic does not offer specialty care for child birth or cancer.
Deductibles kick-in when employees use medical care outside of the clinic. The deductible is $3,000, now. But under a plan presented to the school board by an outside medical management company hoping to do business with the school district, the deductible could nearly triple it to $8,500. Under a family plan the deductible could be as high as $17,000.
Behind the drastic rise is an effort to entice employees to use the more affordable, district clinic rather than going to a different provider medical care. Secondly, if the employee pays more out of pocket for medical care, then fewer dollars will need to come from the district.
The board is expected to learn more about the proposal next month.
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