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FOR IMMEDIATE RELEASE |
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State
Rep. Dan Surra |
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House committee holds hearing on school employee health benefits bill
Statewide plan could produce substantial savings, reduce teacher strikes
HARRISBURG, Oct. 29 – Some form of statewide health benefits plan for teachers and other school employees could save local school districts and taxpayers millions of dollars and reduce teacher strikes, according to supporters of legislation that was the subject of a public hearing held today by the House Education Committee.
The bill, introduced by state Reps. Dan Surra, D-Elk/Clearfield, and Steve Nickol, R-York, would create a board composed of representatives from state government, local school districts and school employees to study the feasibility of developing a statewide health benefits plan for public school employees, and to create and administer the plan if the board determines it is cost-effective.
“The cost of health care is one of the driving forces behind property tax increases and teacher strikes in Pennsylvania,” Surra said. “By taking basic health-care benefits off the bargaining table and out of the local equation, we could substantially lower health-care costs for school districts, reduce teacher strikes and produce huge savings for local taxpayers.”
According to the state Department of Education, school districts in Pennsylvania saw the cost of health care for their employees increase 24 percent between 2003 and 2005. School districts in the state now spend about $1.5 billion each year on medical and prescription drug coverage for employees – about $1 out of every $6 in school property taxes.
“A report by the Legislative Budget and Finance Committee found that leveraging the purchasing power and combining the health benefits of Pennsylvania’s school districts could produce as much as $585 million in health-care cost savings,” Surra said. “Even if we realize only half of that savings, a quarter-billion dollars a year is a tremendous incentive to move forward with this proposal.”
The legislation would create a 12-member Public School Employees Benefit Board with four members representing state government, four from local school boards and four representing school employees. The board would conduct a study of the current health-care benefits delivery system for schools in Pennsylvania, and determine if Pennsylvania should move to a statewide plan for providing basic health-care benefits to school employees.
Such a plan would be mandatory for all school districts except Philadelphia, though Philadelphia could opt in. Schools would enter the statewide plan as their current collective bargaining agreements expire. Once reserves from the program’s initial cost savings were depleted, the state would begin contributing toward the cost of future premium increases for school districts.
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If the board determined a statewide plan is not cost-effective or feasible, or if it could not agree on a statewide plan, it would examine alternative cost-saving measures for school employee health care in Pennsylvania, such as utilizing best practices or building on the health-care consortia that some school districts already use to purchase health insurance for their employees.
All major decisions of the board, such as plan design, benefits and cost sharing, would require a qualified majority, meaning at least two members of the each of the three groups on the board would have to agree.
Surra said the health benefits model reflected in the legislation already is working in several states, including Pennsylvania. The Pennsylvania Employees Benefit Trust Fund, which administers the statewide health benefits plan for state employees, has lowered health-care costs for the state by leveraging purchasing power, introducing healthy living and disease prevention components into its plan, and making other reforms. Last year, there were no premium increases for PEBTF, and in the two years prior to that, premium increases were 47 percent and 63 percent lower than the average increase in premiums in the private sector.
“We don’t know if a statewide benefits system for school employees is right for Pennsylvania, or what kind of savings such a system would produce,” Surra said. “But we do know that health-care costs are placing a tremendous burden on school districts and taxpayers. This legislation would address the problem and, for the first time, give the state a financial stake in controlling those costs while ensuring that all school employees have access to basic health-care benefits.”
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Attention Radio News Directors: an actuality from Rep. Surra is available by calling 1-800-452-3001. Enter PA75 (7-2-7-5) and the pound sign (#) at the menu prompt to get today’s sound. You can also download the sound in .mp3 format by visiting www.pahouse.com/mediacenter.
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CONTACT: Michael J. Herzing Fax:
717-783-6839
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