|
School board mulls new medical insurance plan for employees
BY PAM BRANNON Gulf Breeze News news@gulfbreezenews.com
Teachers and employees of Santa Rosa County Schools will have a new option for their health insurance next year. This program will include not only Blue Cross - Blue Shield coverage, but also a Health Savings Account, with the school district paying half the deductible for each employee.
But school board members agreed at last week's meeting that the best part is that 50 percent of the deductible will be paid in the form of cash placed directly into the employee's Health Savings Account. That cash can be used by the employee as soon as it is deposited to help pay prescriptions, vision, or any medical need even before the rest of the deductible is paid.
Michael Carraway of Fisher- Brown Insurance told school board members, "In other words, they do not have to pay their share of the deductible to start using the cash you deposit into their account. So if people are reasonably healthy and just need the money for a child's prescription or for a new pair of glasses, they might never have any out of pocket expense of their own all year long."
Employees can still choose to stay with the current Preferred Provider Organization (PPO) program offered by the school district. But if they choose to go with the Health Savings Account plan (HSA) and Blue Cross - Blue Shield, once the entire deductible is met Blue Cross - Blue Shield will pay 100 percent of all remaining medical costs for the year.
Carraway said the deductible for an individual is $1,500 a year, and for a family plan it is $3,000.
"So you can see how the school district paying half that cost can be a big help to the employee," Carraway said. "You will place either $750 or $1,500 cash right into the person's account, and it is theirs. No one else can touch it. And if they do not use it in one year, then it rolls over to the next. It is always their money, and part of their insurance benefit." Carraway said the employees can also place money into their own HSA . "They can have it taken out by payroll deduction, or do it themselves. But they do not have to contribute anything if they do not want to."
He said there is a cap as to how much they can place in the account in 2008. For individuals the HSA cap is $2,900 and for the family plan HSA the cap is $5,800, which includes the payment from the school district. But he said the cap is supposed to be raised for the next year to a higher amount and may eventually be lifted.
"That could mean, since this money is rolled over each year and the brand new deductibles and new payments from the school district are in place each year, that a person could get to be 62 years old and have a nest egg of say $50,000 in their HSA," Carraway said.
Carraway said each employee would get a debit card that can be used at a pharmacy, a doctor office, or for eye exams, and such.
"If someone uses the money in the account for something other than medical needs, then there is a penalty accrued against the account of 10 percent," he explained.
He said the difference for the employee's share of the annual premium between the PPO and the HSA plans is $880. "That is a 28 percent difference in premium. That is a drastic savings alone to the employee -- saving $880 a year just in premiums paid," he said. And he said with the PPO there are co-payments, of course, on top of the premiums.
The school board was given the option of depositing their 50 percent share of the deductible into the employee accounts in quarterly payments or semiannually.
"I think twice a year is the best option," school board member Ed Gray III of Gulf Breeze said. "That way it is greater incentive to switch from the PPO, if we put one large lump sum in the accounts Jan. 1 and another lump sum July 1." The rest of the board agreed.
The plan is to start these Health Savings Accounts Jan. 1, 2008.
| 
