School employees in Richey, a small district in Montana’s northeast corner, saw their health insurance premiums skyrocket 70 percent three years ago — but this year, they’re looking at next to no increase at all.
The same goes for school employees at tiny Harrison, in the polar-opposite southwest pocket of Montana, and nearby Monforton School, where premiums will actually decline for some workers.
What happened? All three schools are part of the state’s first two “inter-district cooperatives,” which are groups of small school districts that have banded together as a single purchaser of health coverage.
“My staff is really excited about having some different options that they didn’t have before,” says Lynne Scalia, superintendent and principal at Monforton, about 10 miles west of Bozeman. “None of us was sure that this was going to work, because everyone had to make some concessions. But it was very smooth.”
The northeastern Montana co-op includes 11 schools, from Jordan to Westby, and will cover 205 employees, starting this summer.
Six schools are in the southwestern Montana co-op: Harrison, Monforton, Gallatin Gateway, Gardiner, Sheridan and Shields Valley. Their co-op will cover 137 people.
The 2011 Montana Legislature authorized inter-district co-ops as part of its major school-funding bill.
Brad Moore, superintendent of Richey schools, says he spent some time last spring looking through the bill and saw the part about multidistrict agreements.
He later contacted all of the small schools in northeast Montana that had health insurance through the Montana Unified School Trust, a nonprofit group that insures about 120 schools statewide.
“We decided to put it all together, and it kind of grew,” Moore recalls. “We knew there was strength in numbers, and we wanted to reduce our risk.”
Moore says when Richey faced its 70 percent increase in health premiums three years ago from MUST, the district shopped around — but found it could get nothing better, because of its small size. The district has about 20 people covered by its plan.
With the new co-op, Richey employees will see minimal increases this year on health insurance, as well as having more plans to choose from.
“I’ll have a $4 a month (increase),” Moore says. “I can handle that.”
While the co-op will offer small reductions or, in some cases, smaller-than-expected increases in the overall cost, most employees at these schools still pay something from their own pocket for health coverage.
Most districts pay a share of the employee’s costs, in the $375 to $450 per-month range. The cost for covering a family is two or three times as much.
Still, Scalia says Monforton employees are happy to have some extra money in their pocket, thanks to lower health-coverage costs starting next year.
Darren Strauch, superintendent at Harrison schools, which has seven people covered by the health plan, says it’s the first time since he’s been there that workers have had the chance to lower their health premiums.
“It was unanimously accepted by our certified teaching and classified staff,” he says.
Eric Schindler, CEO at MUST, says the co-op allows several small schools to become a “large group” for insurance purposes, giving them a better overall rate, more coverage plans and the flexibility to improve their claims experience and perhaps control rates further.
Scalia says while the southwestern Montana co-op has only six members this year, she fully expects it to expand next year.
“We’ve already received several emails from districts that heard about it and who have asked, ‘Can we join in?’” she says. “I definitely anticipate that occurring.”