School district employees soon may have a revised health care plan if the Lake Havasu Unified School District joins the Northern Arizona Employee Benefit Trust. Doing so would save the district nearly $200,000 in premiums during the first year alone.

The district was invited to join the trust in a letter dated Feb. 3. It would be effective July 1, 2020. Other members include the municipalities of Lake Havasu City, Kingman and Bullhead City. NAEBT was established in 2012.

Details of the plan were laid out for the district’s governing board at a work session Monday evening. Consultant Erin Collins gave a comprehensive presentation to the board outlining the features and benefits of joining the NAEBT. He is the founder of Erin P. Collins & Associates, Inc., an employee benefits consulting firm with offices in Kingman and Phoenix.

In order to join NAEBT, the school district would have to dissolve its in-house Employee Benefit Trust. If that comes to pass, the two trusts would run parallel for about 18 months while the school district’s existing trust satisfies all outstanding benefit claims.

Collins said NAEBT currently covers 1,070 employees and 2,618 members. Including Havasu’s school district would add approximately 400 people to the employee base. More people enrolled means more buying power and premium costs are more apt to be contained. Also, all related contracts are held in the name of the trust.

He characterized the move as “linking wallets. It spreads the risk over a larger population,” Collins said.

By joining NAEBT, district employees would be covered by Blue Cross/Blue Shield. It includes “nationwide” coverage, which means employees and their dependents have coverage from coast to coast. This is a true perk for parents whose insured college-age dependents live outside of the Havasu area.

It would also include an Employee Assistance Program, which is currently not available to district staff. EAPs address issues affecting mental and emotional well-being, such as alcohol and other substance abuse, stress, grief, family problems and psychological disorders.

Collins pointed out one drawback of NAEBT. Services at the Mayo Clinic are not included in the coverage except in the case of transplants, unique specialties or emergency care.

Other benefits include prescription drug coverage, dental and vision plans and life insurance. Also, retiree benefits remain the same.

The school district must respond to NAEBT’s invitation by March 4.

The rates

District Business Services Manager Mike Murray pointed out that whichever path is taken, the cost of insurance and benefits are going up. With the district’s current EBT, the increase is $680,000. Joining NAEBT would mean an increase in the neighborhood of $500,000 to the district.

“No matter what we do, there’s an increase to it,” Murray told the board.

Collins said that joining NAEBT would reduce the volatility of annual rate increases because premium rates are calculated less frequently.

“The new EBT gives the district stability of premium rates because they are only reevaluated every three years,” he told the board.

There is no financial buy-in to the school district if it joins NAEBT. It will, however, have the opportunity to share in any surpluses.

Next step

The district’s governing board may make a decision about joining NAEBT as early as Tuesday. It has scheduled a special meeting at which it can make a decision on the matter. That meeting is at 4 p.m. Feb. 18 at the district’s main office, 2200 Havasupai Blvd.

The board’s regularly scheduled monthly board meeting follows at 6 p.m.

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