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save millions of dollars by migrating to larger shared-risk pools. What if school districts and their employees throughout California joined to create one of the largest pools of all? That’s exactly the possibility being ex- plored by the California Education Co- alition for Health Care Reform (CECH- CR), a coalition of public school labor and management groups. A 1.6 million- member “School Pool” could lower costs and improve benefits for public educa- tion employees and their families by in- creasing district leverage in purchasing and negotiating benefits coverage. The Mercer Report, a 2007 study authorized by AB 256, first explored this idea and found that a statewide pool in California School pool option explored D istricts like Montebello, Stockton and others have been able to main- tain top-quality health plans and could save over $401 million per year. Such a plan has proved successful in a number of other states. However, the Mercer report also raises potential challenges for im- plementation in California and how it would impact lo- cal chapters: • To be successful, partici- pation by all education • If required, the inclusion of retirees could signifi- employees would be man- datory. • In order to achieve reduced administra- tive costs, a school pool would need to cantly impact the cost sav- ings of the pool. be administered by a single entity, such as CalPERS or a similar institution. The School Pool isn’t a panacea to the CTA Board member Don Bridge health care crisis. Still, current health care cost increases are unsustainable if allowed to continue. While the typical increase for school districts in 2009 was 6 percent to 14 percent, some districts received rate increas- es as high as 40 percent for their plans. Those increases have caused employee contri- butions to soar as high as $1,800 per month and have forced some workers to join the ranks of the uninsured. Much of this cost is spent on administrators for the plans and not on actual health care. In fact, health care administration has grown by nearly 3,000 percent over the last 30 years, while the number of physi- Continued on next page DECEMBER 2010 • JANUARY 2011 | 23

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