School workers may pay more

• By CHARLES LUSSIER
• Advocate staff writer
• Published: Jul 9, 2009 - Page: 1B

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Medical insurance premiums for East Baton Rouge Parish school employees, both active and retired, may be heading up after years of no increases.

On Wednesday, Mercer, a company that tracks medical spending for the school system, recommended increasing premiums by $10 to $38 per year, depending on the plan the school system employee is enrolled in and whether the employee has other family members on that plan.

Mercer also recommended several smaller changes for cost-saving and medical reasons. For example, the company recommends limiting payments for prosthetic limbs to encouraging certain employees, such as those who are overweight, to visit a dietitian before diseases such as diabetes set in.

The School Board’s Finance Committee heard Mercer’s recommendations Wednesday, but is delaying a decision until it meets again in August.

School officials want a board decision no later than September and the changes would go into effect Jan. 1. The changes would affect about 10,000 current and former school employees.

A few years ago, the school system poured more money into its medical coverage from its budget and required employees to pay more.

But faster-than-inflation increases in health-care costs have finally used up the surpluses.

Mercer is projecting that in 2010 the school system faces overall spending on employee medical costs at more than $80 million, a 4 percent increase over what the consulting firm is projecting for the rest of 2009. Mercer recommends increasing employee premiums by an average of 9 percent, covering about half of the $3 million in increased spending.

Phyllis Heroy with the Baton Rouge Retired Teachers Association asked why retirees’ premiums would increase slightly more than those of active employees. She urged the board to exempt retirees who take in less than $10,000 a year from their pensions; she said more than 750 such retirees live in Baton Rouge and for them, even small increases are hard to afford.

“My concern is on behalf of those who have been retired for years and are receiving very little,” Heroy said.

Catherine Fletcher, chief business operations officer, responded that some of those retirees have other sources of income, such as investments.

Under the recommended premium increases:
n Active employees on the Core plan would pay between $10 and $30 more per year, while those on the more generous and expensive Buy Up plan would pay between $7 and $24 more per year.
n Retired employees on the Core plan would pay between $15 and $38 more per year, while those on the Buy Up plan would pay between $12 and $30 more per year.
The committee debated another proposed change that would delay for six months gastric-bypass surgery for employees who need to combat obesity.

Mary Morrison with Mercer suggested the school system restrict such procedures to doctors within its health network, as well as require a psychological evaluation and a six-month weight loss program supervised by a doctor. Morrison said in three cases last year employees failed to take these steps before gastric-bypass surgery and ended up with post-surgery complications and big medical bills.