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Insurance broker tells Hillside board he can cut district health costs; union asks about Jan. 1 coverage
Summary
An insurance broker from Brown & Brown urged the board to re-bid stop-loss and pharmacy contracts to save an estimated $500,000–$1 million; the union president asked whether changes would affect employee coverage ahead of Jan. 1 and was told members’ coverage would not be impacted while the market is explored.
An outside broker told the Hillside Public School District Board of Education on Dec. 19 that the district could save hundreds of thousands of dollars on its health-plan reinsurance and pharmacy spend by re-bidding the account.
Jacob Krakauer, identifying himself as an insurance broker with Brown and Brown, told the board he reviewed numbers on the meeting agenda and said the district’s stop-loss premium and prescription costs had increased substantially since Brown and Brown last served as the district broker three years ago. He said his firm would take the district’s coverage requests to multiple markets and estimated potential savings of “a minimum of a half a million dollars to a million dollars” if the district re-solicited the stop-loss and pharmacy contracts and optimized plan design.
Angela Lawler, president of the Hillside Education Association, asked whether exploring alternative brokers or markets before Jan. 1 would jeopardize employee coverage. Krakauer said there would be no impact on members’ coverage if the district explored the market and that proposals could be returned in time to secure coverage for Jan. 1. He recommended at least auditing the current consultant and bringing the stop-loss market proposals back quickly.
Superintendent Glover and the board did not announce any immediate procurement changes during the public meeting; Krakauer’s remarks were delivered as public comment and the board said it would take the information under advisement.
Why it matters: Health-plan and prescription costs are major district budget drivers; potential savings in re-bidding these contracts could materially reduce district expenditures ahead of an expected flat or reduced state-aid environment.
Follow-up: The board may determine whether to re-open procurement, audit the current consultant’s work or solicit competitive proposals during budget planning.
