Actuary Warns School Health Fund Could Run a Deficit by Late 2020s; Recommends Higher Base Contribution and CPI Indexing
A Segal Group actuary told the Senate Education Committee that Arkansas' school employee health insurance fund, while currently well-resourced, faces projected deficits by 2028–2029 without funding changes; he recommended raising the base contribution and indexing increases to medical CPI. Key questions from legislators focused on pharmacy rebates and utilization trends.
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Patrick Klein, an actuary with the Segal Group, told the Senate Education Committee that Arkansas' public-school health insurance fund currently holds about $250 million in assets but is projected to move into a structural deficit in the late 2020s unless funding or cost trends change. "The trajectory of the fund in 2025 and beyond is in a negative position," Klein said, citing Milliman's cost projections and a medical cost trend he described as roughly 6 percent versus a long-term target medical CPI of 4 percent.
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