Tonawanda News

Local News

April 26, 2013

Schools hit hard by health costs

Tonawanda News — A survey recently conducted by the New York State Association of School Business Officials on school districts across the state found health care costs are second only to pension contributions as the largest costs in western and central New York. 

The non-profit made up of school business officials looked at two years, 2011-12 and 2012-13 and found that health insurance premiums rose an average of 7.44 percent, while districts anticipated next years cost to rise 7.2 percent. 

As districts continue to adjust to a loose 2 percent state-mandated tax cap some of those costs are being passed on to school employees who on average pay 12 percent of individual coverage insurance premiums and 13 percent for family coverage, the survey found. The average state school aid rose 4.7 percent in 2013. 

“Many school districts currently band together to purchase health insurance to reduce costs and administrative overhead, but much more needs to be done to reign in rising health care expenses,” said Michael J. Borges, NYSASBO executive director.

The average monthly health insurance premium cost per participant is $660 for individual coverage, and $1,716 for family coverage. School districts expect these premium rates to rise to $708 and $1,840 respectively for the 2013-14 school year if industry trends continue.

“State policymakers need to work with school districts to develop a framework that maximizes the cost benefits of consortium purchasing of health insurance and reduces unnecessary utilization of health care providers,” Borges said. 

School districts spend approximately $4 billion annually on health care or about 10 percent of total school spending statewide.

School districts within the Capital and Western regions saw the largest increase in health insurance premiums last year at 9.29 percent and 10.58 percent respectively. School districts within the North Country regions saw the smallest increase, with premiums rising 4.92 percent. 

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