Health Insurance Blog

EAST GRAND RAPIDS — Fed up with skyrocketing health insurance costs, the East Grand Rapids Public Schools district is expected to take the first step toward creating a self-insurance pool for administrators and other nonunion employees that could include more than a dozen local districts.

The West Michigan Health Insurance Pool was established after spending three years negotiating with the state to reduce insurance costs. The pool will cover administrators and other non-union personnel, but not teachers. Teachers are covered by Michigan Education Special Services Association, known as MESSA.

The districts would save about $1,000 per employee. East Grand Rapids has about 26 employees eligible to be covered under the plan. It is not much, but pool members say it’’s a start. “The need for change is obvious. We”re doing what we can to provide more-effective benefits to our employees,” said Doug Derks, East Grand Rapids assistant superintendent for business.

Insurance costs are the second-highest cost in any school district’’s budget. Across the state, $2.2 billion will be spent this year alone.

MESSA takes in $1.2 billion, Derks said, but the other $1 billion is something districts can, and should, do something about. Derks said it was a natural outgrowth of the liability insurance group that formed locally several years ago, as well as a beverage consortium that strong-armed soft drink companies into even bigger financial packages for allowing vending machines on school property. Derks, in turn, credits state Sen. Ken Sikkema, R-Grandville, with pushing through legislation allowing school districts to band together and self-insure.

“The money we are putting towards education is being chewed up by health insurance costs,” said Ari Adler, Sikkema’’s press secretary. Adler said the state is looking at an eventual statewide insurance pool for teachers in order to trim costs.