Insurance costs stay steady in C.F. school district

No, employees in the Columbia Falls School District aren’t exceptionally healthy.

That’s a misconception that clerk Dustin Zuffelato has heard more than once.

It’s the assumption people make when they hear the total cost of the district’s health insurance increases between 5 percent and 10 percent a year.

In 2010-11, Zuffelato expects a maximum of a 7 percent increase to the total cost. That’s an impressive-looking figure when compared with the premium rate increases other Flathead County districts anticipate next year.

Columbia Falls is the only Flathead school district that doesn’t get insurance through the Montana Unified School Trust, the self-insurance pool that insures 230 school districts and related organizations across the state.

MUST has lost 75 percent of its reserves over the last three years because claims have outstripped projections.

To rebuild those reserves, the trust has raised its insurance premiums by an average of 39 percent.

At almost 40 percent, the average is slightly higher in Flathead County.

Marion School is at the low end with a 30 percent rate increase; at the high end, a cooperative of rural school districts and education organizations was quoted a 48 percent increase.

With the exception of Bigfork, those school districts are shopping around for other carriers.

Columbia Falls isn’t shopping, either. The district has been self-insured at least since the 1990s and has no plans to change its setup any time soon, Zuffelato said.

“We’ve been pretty happy with the results of how it works,” he said.

The total cost of Columbia Falls’ insurance has increased fairly consistently over the last several years.

In 2009-10, the increase was 7.4 percent. In 2008-09, it was 3 percent. The year before that, insurance costs increased 10 percent.

“It just kind of is pretty stable and consistent,” Zuffelato said. “A nice, stable increase is way better than it going down and going up.”

Most of the increases are driven by national costs, he added. As it gets more expensive to get treatment, see a doctor or buy prescription medications, customers pay more for insurance.

Over the last decade, the total cost per employee per year has gone from $4,200 to almost $12,000, he said, primarily because of the rising cost of treatment.

“Medical costs have gone up each year, usually around 10 percent,” Zuffelato said. “We’re actually below that in how it trickles down to us.”

How it trickles down next year will depend on negotiations with the district’s teachers union. Negotiations have determined how much employees pay each month for insurance and how much the district is responsible for.

The total cost per employee per month is nearly $1,000, but the district — or the taxpayers — pay the bulk of that cost, nearly $800, Zuffelato said. Reserve funds shoulder some of the burden, and the rest is paid by employees.

“It ends up being around $90 for a family and around $15 for a single employee,” Zuffelato said. “The employees get a very good benefit.”

The district’s insurance pool also is set up to handle large claims so the district and its employees won’t suffer.

“One or two [large] claims isn’t going to kill us,” Zuffelato said.

That’s because the district has stop-loss insurance in place to ensure it doesn’t pay more than a certain amount. If, as a district, claims exceed 125 percent of the available pool of funds, Companion Life Insurance picks up the tab.

Companion Life also pays for individual claims that exceed a set amount.

“If an individual goes over a $70,000 claim, we don’t pay a single cent,” Zuffelato said.

If claims fall between 100 and 125 percent of the available funding, Columbia Falls would use its reserve funds. At the end of last year, the district had close to $3 million in its reserves, Zuffelato said.

“Five or six years ago, they were a million [dollars]. We’ve more than doubled in the last 10 years, so we’ve got that stability as well,” he said.

He estimated it would take several years of high claims to tap the reserves.

“If we have five straight years of bad years, we wouldn’t be able to use that any more,” he said.

Reporter Kristi Albertson may be reached at 758-4438 or by e-mail at kalbertson@dailyinterlake.com.