Health Insurance Update

For School district employees

Effective July 1, 2002

State Mandate

• $150 minimum effort

• Indexed 200-2001 contributions

• Maintenance of effort (In Audit Footnote)

• Example:

• 2000-2001 Contributions/full time FTE

• X 2002-2003 full time FTE’s

Full time employees

• For calculation purposes, any employee that is a contributing TRS member.

• For LISD, any employee working 20+ hours per week

Election Forms

• Explanation of $83.33 benefit • Election form for

- Health insurance- Health expenses – section 125- Income compensation

• English and Spanish• Notice by July 1, 2002• Election by August 1, 2002• New Insurance by September 1, 2002

New Funds

• Funds for minimum effort = 0• Funds for transition aid = $900 per year or $75 per

month HOWEVER only if above 75% of formula gain in Tier II aid. Meaning, the State is mandating how to spend the new funds that we would have used for salaries.

• Funds to LISD to the employee = $1,000 or $83.33 monthly

Options for Employees

For the $1,000, (Around July and August)

- Buy more health insurance for him/her or dependent

- Establish a cafeteria plan – 125 for health care expenses

- Receive funds as income compensation subject to FIT- not eligible for TRS

$83.33 Funds

Will use fund 418

Will use expenditures code 6132

Will report it the 10th of the month

Will receive it the 20th of the month for employees active contributors to TRS

Impact

• Employees that traditionally rejected insurance may want to be added now = Additional cost to LISD

• Type of Plan = Contributory vs non-contributory• Required Plans =Three New plans that we are

seeking proposals for.• Required mandate to spend on this program with

funds that would have gone for salaries.

Type of Plans

• TRS required that districts provide the following levels

• Low Option, High Option and State Option

Summary• MOE = $7,229,271/3.284 = $183.45• Required Minimum $150• Excess MOE = $33.45 to be used for salaries higher

than in FY 2000-2001

FROM LISD

(1) LISD will contribute $225 per month in health contributions . . . . . . . . . . .AND

(2) $33.45 per month in additional salary compensation

FROM STATE

(3) $83.33 per month will come from the State

What’s Next• Define LISD Contribution: $225 per month

• Define State Contribution: $83.33

• =====================================

• Last year’s Rates $209 and $223 per month

• Define Plan Level: 4 proposals

• Define Negotiating Team:

• Define Input from Employee Advisory Committee

• =====================================

• Employees to Submit response by Aug 1st

• July and August will be enrollment period

Board Decision

by June 13th

New Policy

by Sept 1st

Totalavailable $308.33