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RSD205’s insurance plans – a very good deal

Continuing with the Rockford Education Association contract, Article 31 -Insurance Protection – The district offers Health Insurance Plans to staff members and their dependents in the amount of One Million Dollars per covered individual.

If a spouse currently under the Health Insurance Plans is ineligible for his/her employer’s health insurance as outlined in paragraph one, or due to medical conditions is unable to become eligible under his/her employer’s plan, he/she may remain solely on the Health Insurance Plans and in some circumstances may be accepted to the plan even with a preexisting condition.

The following monthly premiums for health insurance plans are as follows: the Employee pays nothing for the United HRA Plan and $25 per month for the PPO plan; (Employee + children) pays $29 for HRA and $55 per month for PPO; (Employee + spouse) pays $36 for HRA and $59 per month for PPO, and the Family premium per month is $46 for HRA and $89 per month for PPO.

In Section D, the district offers a fully paid group dental insurance plan and in Section E, a group term life insurance and Accidental Death and Dismemberment policyof $20,000 per employee. Section F establishes an Insurance Committee of three board representatives and three association members to investigate various HMO and life insurance plans.

The district also provides a supplemental disability benefit up to 30% of pay, that when added to the Illinois Teacher Retirement Act benefit totals 2/3rds of the teacher’s current salary.

Before negotiations begin on the next contract, the board must determine the total costs of all these contractual insurance benefits and determine the portion that both the district and the association will pay in future years in our current economic environment. These benefits cost the district tens of millions of dollars, at nominal cost to the association members – a very good deal.

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8 Comments

  1. Taylor Grant

    If the deal is so appealing why didn’t you become a teacher Ted?

  2. Speaking of good insurance deals, ObamaCare will dump millions of middle-class people into Medicaid, which is supposed to care for the poor. Remember when Pelosi said: “We have to pass the bill, to find out what is in it”? The Democrats’ chickens are coming home to roost.

    See: http://www.cato-at-liberty.org/obamacares-latest-glitch-medicaid-for-millions-of-middle-class-retirees/

  3. Neftali

    Wow…their health insurance rates are a steal. I pay a little over $200 a month for 80/20 coverage through my employer, and I consider myself fairly lucky compared to a lot of the stories I’m reading.

    No wonder our taxes are so high, these people don’t have to pay for anything. I’m sure in the next round of negotiations the teachers union will ask the taxpayers to pay off each of their mortgages….and they’ll probably get it.

  4. My doctor’s office had to call my health insurance company the other day to check to see if I needed a referral. The nurse got a nice lady on the phone – in INDIA! Nice to know this company made a 22% profit last year also. And there are those out there who don’t want to change anything????

  5. Ted Biondo

    Kathy, Welcome to the blog. The fact that your insurance company had someone in India and made a profit does not have anything to do with the teachers paying $89/mo for health insurance for an entire family.

    I’m retired on Medicare, which I paid for decades, but mine and my wife’s supplemental and dental insurance, Long term care and Rx prescriptions is $550/month for two people and I still pay another $300 to $400 per month for prescriptions over and above what is covered by insurance and deductibles. Plus I pay taxes for a public employee, who is paying 0 to $89 per month for better insurance than I have.

    Something is indeed wrong with this picture, don’t you think, Kathy? Maybe I should include the portion of my property taxes that pays medical insurance for all public employees on my non-covered insurance deductions on Form 1040 Schedule A that I send to the IRS, right?

    Even with all that, I still don’t want to be placed on a rationing list behind millions of people who don’t pay anything for their insurance, while we are paying for their health coverage and ours!

  6. Ted, thanks for your point. Actually, I was responding to SNuss. His rants about “Obamacare” don’t have a whole lot to do with this topic, either, in my opinion.

  7. Denny Wallace

    “…Nice to know this company made a 22% profit last year also. …”

    Ok please define for me what 22% profit you are referring to with a Health Care Insurance Company?

    Typically Profit is defined as Revenue – expenses = profits.

    So Hypothetically speaking… How does this relate to Healthcare Insurance Company (FYI I’m an rookie, amateur at best but just applying simple commonsense… Not saying it’s the complete stroy)

    So XYZ Health Insurance Company has reported earnings of $10 million dollars… This could also be called profits but how do you come up with earnings?

    Hypothectically lets say XYZ pays out $10 billion dollars in Medical Claims… That’s one heck of a lot of office vistis, minor and major surgeries and a bunch of complexed and highly specialized medical care and treatment….

    My math may be bad but if XYZ Inurance company paid $10 billion in claims and earned $1 billion that = 10%

    $10 billion and earned $100 million and that = 1%

    So $10 million in earnings on paying $10 billion in claims = .1% or one tenth of one percent.

    Yet in this case… for the Health Insurance Company the formula Revenue – expenses = profits isn’t so clear… The Hospital may pay out $10 billion in medical claims (A HUGE NUMBER and effort to successful perform) but $10 billion is not their revenue.

    So what is the revenue number for the formula? Well typically it is 10% (or much less) of the claims the Insurance Company pays out… So if They payout $10 billion in claims that would mean $1 billion in revenue.

    So to make 22% profit in this example that = $222 million dollars….

    So in this example, the Insurance company would spend $788,000,000,000 to build (my guess) the 10,000+ employee organization simply to play the bills + the Doctors and Nurses on staff (+ the India call centers) to figure out what bills were legit and what weren’t…

    Realistically… I doubt any Health Insruance Company today is earning (i.e Profiting) anywhere close to 22%… Most Corporations are lucky to have 5-6% profit margins… In the above rough example… My wild-ass guess is the Insurance company might at best have $500 million in revenue to build the organization, call centers in India + Doctors and Nurses to figure out what should be apid and what shouldn’t… and if they were extremly lucky…. After paying out $10 billion in Medical Claims they would at best earn $25-$50 million or about 5% to 10% profit (on their revenue)

    i.e. two tenths of one percent to maybe five tenths of one percent of the $10 billion in claims they paid…

    My guess Kathy is you mis-read $22 million to = 22%

    Yet remember… I’m no bean counter so my numbers may have assumptons errors… Yet I bet I’m much more right then dead wrong to suggest…. Forget suggesting Health Insurance companies make big profits!

  8. Denny Wallace

    oops my bad So in this example, the Insurance company would spend $788,000,000,000 …. should have been $788,000,000…. three to many zeros

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