Idea of a Statewide Health Insurance Contract Met with Confusion, Skepticism

Jan 22, 2017

Iowa Gov. Terry Branstad proposes changing how the state provides health insurance for state employees.  In his Condition of the State message earlier this month, he proposed replacing more than 400 existing plans with one statewide contract.

“Just a few adverse health outcomes can destroy the budget of a city, county or school district,” Branstad said. “By replacing this system with one, comprehensive health-care contract, we can spread the risk and dramatically reduce costs.”

It’s a statement that is confusing to educators.

“It seems in this that in one stance, the Governor really wants local control which is what this is,” says Tammy Wawro, president of the Iowa State Education Association.  “It has our local school districts working with their educators, seeing what’s best for them…and moving from that to one-statewide plan.”

Wawro is referring to the contracts her union negotiates with individual school boards across the state.  Those contracts include health insurance benefits.

“The funds that go to a teacher in a school district, that bargaining unit bargains those funds all together,” she says.  “We don’t bargain separate an insurance plan and a salary package. So that’s very different.”

Different in that school district collective bargaining may trade some salary increases for better health insurance. Wawro doesn’t want to lose that.

“I also want to be very clear that we are not state employees,” she says.  “And is a very different conversation for our school districts than our state employees.”

On the other side of the bargaining table, school boards. The Iowa Association of School Boards’ Executive Director, Lisa Bartusek, says getting schools into a larger health insurance pool isn’t entirely new.

“Iowa school boards have been on record through our platform for the Iowa Association of School Boards, in support of voluntary access to the state health pool,” she says. “I think they recognize that the state health plan has some benefits. Mandatory, or requiring participation is a different matter.”

Bartusek says the school board association is seeking more information, raising thought-provoking questions for legislators and the governor.

“The questions are things like what would the base plan be like?” she asks. “What kind of flexibility would exist for local schools, or would it be all one plan? What would be the financial impact to schools and to employees? What happens for schools who are one the borders of our state, whose plans now provide coverage in other states, such as employees in northern Iowa whose employees can access service providers like doctors and hospitals in Minnesota. So again, far more questions than answers.”

But, Bartusek says, that doesn’t mean schools are rejecting the idea of a statewide health insurance plan for public employees.

“So, we’ve been receptive to the idea to the idea, but as of yet, nothings been put in writing, so right now we just have more questions than answers, and we’ve been offering the questions to legislators and the governor, to help them think about what this plan might have to look like if it were to be successful.”

It also doesn’t mean school boards are willing to sacrifice local control over negotiating health insurance benefits to save money.

“The governor says it has the potential to save funds,” Bartusek says.  “We’d like to see the data that shows that. And the question remains, save funds for whom? And what’s the impact on employees. What’s the impact on local schools. What’s the impact on our state as a whole, and our schools. I want to see the data.”

And the ISEA’s president, Tammy Wawro, says she’s skeptical on that point.

“To move to something so grandiose and large it’s very confusing to us,” she says.

Even if answering questions sweeps away that confusion, a statewide health insurance contract won’t come soon. Schools and teachers are negotiating next year’s contracts now.