With Tax Rate Already Rising, Manchester School Board Looks To Change Health Insurers

Faced with a budget that already was increasing the school district’s tax rate, Manchester Township school district officials are considering a new health insurance carrier after the old one sought a double-digit increase in the price of benefits.

District officials initially had planned to ask the Board of Education to approve the switch to AmeriHealth, the new carrier, at its meeting two weeks ago. But objections from the Manchester Township Education Association and the district’s other unions, which sought time to review the proposed coverage under AmeriHealth, led to a delay in the vote.

That vote is expected to be taken Tuesday night at a special meeting scheduled for 7 p.m. at the Ridgeway Elementary School media center.

Dan Staples, president of the MTEA, thanked the board for delaying the vote, saying he and the union had been completely surprised by the plan to change carriers, which he said was not mentioned until the day after the union, which represents about 450 teachers, secretaries and other staff, met with the district to begin contract negotiations for the 2015-16 school year and beyond.

“There was an exchange of proposals followed by discussion. At no time was a change in health carriers discussed,” Staples said in his prepared statement, explaining the reason the teachers had packed the room. It wasn’t until the next day at a meeting with business administrator Craig Lorentzen and the presidents of all of the district’s bargaining units that they learned of the plan to change carriers.

“I know the timing was not the best,” Lorentzen said. He indicated the district had been caught off-guard by Blue Cross Blue Shield, which hit the district with a double-digit increase after promising the district back in February that it would lock Manchester’s rate increase in.

“We were promised a rate we believed we would get,” Lorentzen said. “The actual was double.” Efforts to negotiate a lower rate increase continued up until May 11 and included a face-to-face meeting with Blue Cross officials, but BCBS refused to budge, he said.

Staples said the unions had received information on the two health plans to compare coverage, and Lorentzen said the district would hold information sessions to answer questions.

Lorentzen assured the teachers present that the coverage was not being downgraded in the switch, however.

The budget of $50,216,031 for the general fund, which was approved on May 6, included an 8.5 percent increase in the cost of health benefits, school district officials said, which was one of the factors contributing to a 1.27 percent increase in the tax levy. Of the $50,216,031, $41,933,692 will be raised by taxes, Lorentzen said. Debt service increases account for a third of the tax levy increase, he said. Other factors that impacted the tax levy included an increase in pension contributions required by the state, out-of-district placements for special education students, maintenance of facilities and equipment, gas and utilities increases, and a $64,500 increase in Ocean County Vocational School tuition levied by the county.

The state funding formula, which classifies Manchester as a wealthy district because of its demographic makeup, puts a burden on Manchester residents to pay 82 percent of the budget through local taxes, Lorentzen said. Manchester receives only 11 percent in state funding, while the average is between 30 and 40 percent, he said. Federal aid, at 1.9 percent, is expected to decrease over the next few years also.

The impact is $36 per $100,000 of assessed home value or $57 for an average home in Manchester assessed at $157,000.

Superintendent David Trethaway has been meeting with school officials in the Berkeley Township and Central Regional school districts, which is in a similar situation with state aid, to look for ways to lobby to change the formula and help beleaguered taxpayers in their towns.

Board President Donald Webster Jr. said the double-digit increase in the health insurance was simply a cost the district can’t bear.

“We just can’t deal with that in the 2 percent cap,” Webster said. “That’s why we’re looking at proposals.

“We can’t go to community and say we’re going to go with higher-priced health benefit plan. We can’t leave that money on the table.”

(Teachers pack the media center at Ridgeway Elementary School on May 13 for a Board of Education meeting where a plan to change health carriers had been expected to be voted on. That vote was tabled and is expected to take place Tuesday evening. Credit: Karen Wall)