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Northfield recommends 10% health premium increase; dental and health remain self‑insured with $125,000 stop‑loss
Summary
District finance director presented the internal service fund covering self‑insured health and dental plans, reported declining enrollment, recommended a 10% health premium increase and described stop‑loss coverage at $125,000 per member.
Val Mersdorf, director of finance, presented the district’s internal service fund budget on April 14, describing the accounts that pay for the district’s self‑insured health and dental plans.
Mersdorf said the district has self‑insured dental since February 2006 and self‑insured health since February 2012. She described revenues as premium payments (paid in part by the district, part by employees and by some retirees under contractual agreements), and expenditures as claims paid plus administrative fees. The district’s stop‑loss coverage is set at $125,000 per member per year.
Mersdorf told the board that overall enrollment in both plans has declined slowly, which she attributed in part to staff reductions and household choices. She said the benefits advisory committee recommended a 10 percent increase to health premiums effective January 1, 2026 (presentation described that a 10% increase was recommended for the next plan year). For dental, the presentation said a 5 percent premium increase took effect January 1, 2025; dental premiums had been unchanged for many years prior.
The director reviewed recent claim history and high‑cost claimants: in 2024, 24 claimants exceeded 50 percent of the stop‑loss threshold (i.e., $62,500) and nine exceeded the full stop‑loss amount, producing a cumulative excess over stop‑loss of roughly $1.45 million for those nine claimants. Mersdorf said the number and cost of very high claimants has declined compared with earlier years.
Mersdorf said the district reviews whether self‑insurance remains the most cost‑effective approach and obtains fully insured quotes every two years; she reported that a fully insured quote received in the most recent review would have increased premiums by more than 30 percent compared with remaining self‑insured.
Board members asked for additional details during later work sessions, including enrollment counts by school, projected fund‑balance metrics, and the district’s prescription‑rebate arrangements with Blue Cross Blue Shield. Mersdorf said the board will be asked to adopt the internal service fund budget at the May 27 meeting.
