Lockport Union-Sun & Journal Online

Local News

February 23, 2013

District to fund health plan

Lockport Union-Sun & Journal — In an effort to reduce future health insurance costs, the Lockport City School District is going to a self-funded plan.

What that simply means is that the district will will be responsible for all medical and prescription expenses, paying those expenses directly to Blue Cross Blue Shield. The change starts July 1.

In the past the district has been responsible for only the premiums. There will be a savings for the district during the first year, then costs would remain stable over time, said Deborah Coder, Lockport’s assistant superintendent for finance.

The gross amount of the health expenses will be listed in the 2013-14 budget like anything else the district spends money on. Medical and prescription claims are budgeted to be $9.9 million for 2013-14. The cost to implement the new plan is expected to be about $1.2 million, meaning the entire plan is slated to cost about $11.1 million total.

Add in federal funds, employee and retiree contributions, that cost is reduced to just over $8.8 million. That is lower than the expected cost of $9.9 million, if Lockport were to stick with the local health consortium it belonged to.

Last month the Board of Education approved new contracts with all three of the district’s unions. The new health plan was the biggest change in the agreements.

The self-funding plan is one of the major factors in Lockport’s 2013-14 budget. The current version of the spending plan stands at $83.2 million, which would be roughly $3.3 million or 4.16 percent higher than the current school year’s budget.

The other big increases are in teacher and employment retirement costs. Expenses in the Teacher Retirement System will jump about $1 million or 26.5 percent for the district, to a total cost of about $5.1 million next year. The Employee Retirement System will go up about $151,000 or 14.18 percent to $1.2 million.

Contact reporter Joe Olenick

at 439-9222, ext. 6241.

Contact reporter Joe Olenick at 439-9222, ext. 6241.

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