Board approves move to self-funded health plan, seeds fund with $2 million and accepts maximum-rate proposal

At the Sept. 22 meeting the New Albany-Floyd County Board of School Trustees approved the district’s proposal to change health-insurance arrangements for 2026 and to move toward a self-funded plan structure. The motion to approve carriers and rates passed on a recorded 6–0 vote.

District staff and broker representatives from Assured Partners explained the rationale for the shift: fully insured renewal bids from major carriers had included large rate increases, and a self-funded structure, coupled with targeted stop-loss insurance and a new pharmacy-benefit contract, offered more levers to control long-term costs, the presenters said.

Chris (staff member) summarized the financial plan. He said premiums paid to carriers would rise from roughly $13.5 million under the current fully insured arrangement to a modeled maximum exposure of about $18.5 million in a self-funded scenario. To bridge that increase, the corporation will contribute $2 million from cash balances to seed the self-insurance fund and will absorb an additional $2 million in premium increases; employees will share approximately $1 million of the increase, amounting to a roughly 20% employee share in the first-year plan design.

Doug and Travis, presenting for the district’s broker and advisory team, explained technical elements: the district will purchase stop-loss insurance to cap the corporation’s liability on individual catastrophic claims (presenters discussed a proposed individual attachment near $200,000) and on aggregate yearly exposure; pharmacy rebates and management will be negotiated directly for the district under a self-funded model, and the district selected Carillon as its pharmacy-benefit manager in the RFP process.

Doug said fully insured quotes provided late in the RFP process ranged from roughly 35% to 45% increases from major carriers; he said the district’s modeled maximum exposure under the recommended self-funded design was a projected 33% increase but that any unspent funds would remain in the health-plan reserves rather than passing to an insurer. "If we don't hit that worst-case scenario, the money that we would pay for those worst-case claims, we get to keep that and utilize that for future," a broker representative said.

Board members asked about “lasers” (stop-loss carve-outs for known high-cost members); presenters said the final laser determinations were pending updated claims data and that any lasers would affect maximum exposure calculations. Staff included implementation credits and performance guarantees from the recommended carrier, and said they would monitor and report back on stop-loss and laser details before final implementation.

The board approved the motion to adopt the 2026 health insurance carriers and rates on a 6–0 roll call. No abstentions or no votes were recorded. Presenters and staff said the administration would return with final stop-loss and laser information as the data became available.