Portsmouth disputes $1.57 million SchoolCare health insurance bill

City officials in Portsmouth are disputing an "unprecedented" $1.57 million bill from its employee health insurance risk pool, SchoolCare.

Portsmouth’s School Department is one of two SchoolCare districts in New Hampshire that haven’t paid their share of a $30 million assessment from last year or settled on a payment plan. The other is the Dover School District.

“The city disputes the authority of SchoolCare to impose an assessment of this nature, and their authority to unilaterally discontinue paying on valid claims for covered individuals,” according to a statement from Portsmouth officials. “The city has proposed multiple paths towards resolution, each of which SchoolCare declined.”

Portsmouth affirmed last week that its staff still has uninterrupted health coverage, but if the issue isn't resolved by May 1, SchoolCare will stop paying their health insurance claims.

Secretary of State David Scanlon was scheduled to attend Monday night’s Portsmouth City Council meeting to advise officials on the assessment.

The city wants to continue providing coverage for school employees through SchoolCare and it continues to make its monthly contributions to the risk pool in a timely manner, officials said in a news release.

However, their $1.57 million assessment, which was issued mid-budget cycle in October, saddled them with “an unplanned and significant cost” and few options to cover it, officials said.

“The City of Portsmouth stands with our School Department staff and is committed to ensuring that they and their families continue to have access to health insurance,” Portsmouth Mayor Deaglan McEachern said. “We will not allow this dispute to jeopardize the wellbeing of our employees.”

The assessment was a result of “unusually high medical and pharmacy claims across the pool” in recent years, SchoolCare representatives said. Three years of post-COVID expenses completely depleted the nonprofit’s reserves and left them facing a deficit.

To erase the deficit and rebuild their reserves, SchoolCare issued a one-time assessment, with a September letter comparing it to how they return surplus contributions to their member entities during better years.

SchoolCare Executive Director Lisa Duquette said, contrary to Portsmouth’s statement saying they offered “multiple paths” for paying their assessment, they only made one offer.

Portsmouth’s proposal involved paying its pro-rated share of SchoolCare’s projected $4.5 million operational deficit by May. The city would then pay the rest of the assessment over two years.

Duquette said they couldn’t accept the solution because it was different from the three payment options SchoolCare offered its member entities. Eighty-eight of its 90 members have already paid or agreed to pay.

"Members share the benefits in good years, and the financial responsibilities in the bad years, and you can't have outliers that want other options," Duquette said.

"The board has fiduciary duties to its membership, or the pool as a whole. As such, agreeing to terms for one or two members that are different from the terms of all other members would not be upholding those duties," Duquette said.

Portsmouth’s public schools are run by the city. Although sometimes entire municipalities are SchoolCare members, Portsmouth School Department employees are the only city staff who get their health coverage through this risk pool.

SchoolCare serves 90 schools and municipalities across the state. At roughly $1.7 million and $1.57 million, Dover and Portsmouth had the third- and fourth-highest assessments respectively of all members, after Concord and Londonderry school districts at about $2 million each.

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