Germantown district recommends Sirius America stop‑loss renewal as health claims spike

District consultants and staff briefed the Germantown Board of Education on Aug. 12 about a stop‑loss renewal for the district’s self‑insured health plan, recommending renewal with Sirius America Insurance (through Peru) at an all‑in specific premium of $1,130,726 for the 2025–26 plan year.

Why it matters: The district is self‑insured and faces large, unpredictable individual claims (staff described nine members with claims above the district specific deductible). Stop‑loss insurance caps the district’s exposure for an individual claimant at a set amount ($125,000 in staff presentations) and protects the plan from otherwise catastrophic single‑case costs.

What staff reported: Lucent Health, the district’s third‑party administrator, solicited five stop‑loss carriers; three submitted proposals and two declined because of uncertainty about large known claims. Staff said Sirius America provided the best firm renewal proposal. The renewal proposal includes an increase in the annual specific premium of about $129,000 compared with 2024–25 and a modest decrease of about $4,700 in the aggregate premium.

Other carriers’ proposals contained so‑called "lasers" — additional, claimant‑specific deductibles that would require district contributions for identified high‑cost members. Manuel summarized those quotes and staff testimony noted Liberty Mutual’s and HCC Life’s proposals included very large lasers (approximately $715,000 and $675,000 respectively) that made those options less favorable. Miss Stratton, the district’s consultant, explained to the board: “A laser is a concept that’s used in the stop loss industry. And, basically, it identifies some of our highest claimants and sets a separate specific deductible amount on those individuals for GMSD to contribute to before any stop loss insurance would take effect.”

Questions from trustees: Warden McCurry asked whether stop‑loss covers prescription drugs; staff answered, “It covers everything.” Board members discussed the plan’s total cost picture: the district has budgeted roughly $6.2 million for health insurance this year and board members noted that adding the recommended stop‑loss premium effectively raises the all‑in projection by the premium amount (one trustee estimated an all‑in figure near $7.3 million when stop‑loss premium and budgeted costs are combined). Staff said there are still stop‑loss payments being processed from last year’s plan and that monthly reporting of claims and cost trends will be provided to the board going forward.

Outcome: The board received the recommendation and asked follow‑up questions; there was no formal vote recorded during the work session. Staff said they do not recommend applying additional lasers to current claimants and presented the Sirius America renewal as the best firm quote received.