OXFORD — School officials and others are hoping to save money on SAD 17 health insurance costs by obtaining competitive bids from multiple providers in the future.

The subcommittee, made up of school officials and teachers, was formed to deal with the effects of the Affordable Health Care Act and to tackle the escalating costs of health insurance. The formation of the subcommittee was part of the mandate of the latest teachers’ contract which expires in 2015.

At the time, the Maine Education Association’s Benefits Trust had a longtime monopoly on health insurance for almost all of Maine public school employees, said Oxford Hills School District director Barry Patrie of Waterford, a member of the insurance subcommittee. But with last year’s enactment of L.D. 1326, An Act To Allow School Administrative Units To Seek Less Expensive Health Insurance Alternatives, the Oxford Hills School District and others can now seek lower-cost health insurance plans.

“MEA insurance had always had a monopoly or stronghold on all information,” Patrie said. “State law had to be changed.”

He said MEA would not release loss information on health care claims to school districts that other health insurance providers needed in order to provide a competitive atmosphere.

“School districts were clamoring for autonomy. You have to have more than one dancer come to the dance to make it effective,” Patrie said.

The Oxford Hills School District pays 80 percent of health insurance for employees who work 25 hours or more a week, Assistant Superintendent Patrick Hartnett said. The rates range from a low of $663 per month for a single user to $1,808 a month for a family.

The benefit is worth between $7,000 and $22,000 a year to an employee, Patrie said.

He said the MEA used a district’s history to set insurance rates. Until recently, the rate increases were the same statewide but last year, they varied from 2 or 3 percent up to a 13 percent. The Oxford Hills School District was hit with an 11 percent rate increase.

“The increase virtually stripped (employees) of seeing any extra money in their contract. We weren’t happy either. That’s big bucks,” Patrie said.

L.D. 1326 requires that health insurers disclose to school districts their insurance claims history. The information could then be provided to health-insurance companies to compare plans and costs.

The Maine Education Association Benefits Trust sued the state to retain the insurance claim history, but the injunction was denied by the U.S. 1st Circuit Court of Appeals. The Appeals Court found in the fall of last year that the MEABT had created “a virtual monopoly.”

Adding to the issue of health insurance rates is the possibility under the Affordable Health Care Act that the district will have to cover full-time substitutes who work more than 30 hours per week.

“It is not clear at this point if the substitutes . . . qualify as regular full-time employees as defined in the law,” Hartnett said. “It would only be a handful who would be impacted.”

Hartnett said the district is calculating the potential impact based on last year’s number of substitutes, but it is difficult because of the changing needs for substitutes from day to day.

The law also says the district must offer affordable and inexpensive health care insurance to its employees or face a potential penalty of between $2,000 and $3,000 per teacher.

The insurance subcommittee will meet Jan. 4 to determine its next step.

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