District faces medical insurance premium hike

NEW LONDON – The School District of New London has found it challenging to renew its medical insurance for district employees for next year due to the high loss ratio it has.
That was the message that New London Superintendent Scott Bleck shared with the board at its Oct. 22 meeting.
At the meeting, Bleck said the district’s Compensation Committee recently met and started discussing the medical and dental insurance renewal for district employees. He said it will be a “difficult renewal this year.”
Typically, it is this time of the year when the district would renew its health insurance plan, but Bleck said the district isn’t “quite ready” to do that. He said the committee wanted to give the school board the opportunity to provide feedback.
Joe Marquardt, SDNL business services director, said the district is in a “difficult scenario” regarding renewing its medical insurance plan because of the utilization of the health insurance by employees.

“We have a calculated renewal increase of 22% from Robin Health Partners,” Marquardt said. “And that is primarily due to utilization. You can see that our loss ratio is about 150%. That means for every dollar collected (in premiums), $1.50 is paid out in expenditures (by the plan). That has been the case for several months in a row, about 18 months.”
Because of the loss ratio trend, Marquardt said the board was proactive last year and made changes to the district’s medical insurance plans a year ago. He said those changes did not stop utilization of the insurance by district employees.
Marquardt acknowledged that more changes to the insurance plans will probably need to be made this year.
“When you have a 22% renewal (increase), that definitely impacts our budget,” Marquardt said.
Board member Nate Grundy asked how other school districts are handling medical insurance cost increases.
Marquardt said there are neighboring school districts who are dealing with large increases in medical insurance costs.
“And the boards are deciding what makes sense locally to make changes,” Marquardt said.
He added that the district has solicited other insurance carriers to bid on the district’s health insurance. Those bids were either higher than what the district currently has, or the insurance carrier declined to provide a quote.
“We’re trying to work on some self-funding options, but when you have high-cost claims, you really hurt your opportunities for self-funding,” Marquardt said.
The board was scheduled to once again discuss its options regarding the district’s medical and dental insurance renewal at the board’s Nov. 12 meeting.