North Allegheny School District swaps insurance providers

Sept. 30--The North Allegheny School District has switched health insurance providers for its roughly 1,000 employees to avoid premium increases pegged at between $4 million and $5 million.

The board unanimously approved a contract with UPMC to provide medical and prescription group health care plans, beginning Jan. 1.

"The district is constantly looking at how we can provide the best possible benefits to our employees at a cost that fits within our budgetary constraints," Superintendent Robert Scherrer said at the Sept. 28 school board meeting. "The decision to change health-care providers was triggered by a drastic increase from our current contract with United Health Care that would have cost the district an additional $4 million to $5 million."

Scherrer said the "greatest concern" when shopping for health-insurance plans "was to cause the least amount of disruption for our employees."

The superintendant said "the vast majority" of the district's employees already use UPMC facilities and physicians and that district officials were drawn to the provider's focus on preventative care.

The group health insurance contract was marketed by the district's benefits consultant and broker, Arthur J. Gallagher & Co., according to district officials. Five insurance carriers submitted bids.

Scherrer said the 2017 insurance premiums will cost 5.65 percent more than this year's price, but the rate will not change in the remaining two years of the three-year deal.

The district will pay about $20 million this year for health insurance. Employees contribute 12 percent of the cost of the premium, along with copays for office visits and prescription medications.

Tony LaRussa is a Tribune-Review staff writer. Reach him at 724-772-6368 or tlarussa@tribweb.com.

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