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Originally published Wednesday, February 8, 2012 at 3:46 PM

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End the sweetheart deals, overhaul public school health benefits

Lawmakers watching every penny can find savings and equity in proposals to consolidate the management and purchase of health-insurance coverage for hundreds of Washington school districts.

Seattle Times Editorial

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OVERHAUL of the health-insurance system for Washington school employees is overdue and should be a priority for the 2012 Legislature. The billion-dollar program is indeed broken.

Taxpayers and school-district employees stand to gain from creation of a state board to oversee a statewide risk pool for K-12 public-school employees' health benefits.

The current labyrinth has 295 school districts and nine educational service districts negotiating with individual unions for private insurance plans. Expensive administrative inefficiencies are obvious, but the system offers little transparency for taxpayers, scant opportunity for oversight and vast differences in coverage and benefits.

The legislative impediments in Olympia virtually make the point. The Washington Education Association and Premera Blue Cross have had a business partnership for the past 50 years that resists scrutiny or challenge. The entities refused to cooperate with an expansive review ordered by the Legislature last year.

Taxpayers and lawmakers do not have the patience or cash to further indulge sweetheart deals fueled by public dollars.

Last year, state Auditor Brian Sonntag produced a performance review that estimated annual savings of $90 million with coherent management of the K-12 employee health-care system. The current pottage of pools, plans and insurance companies keeps prices high for some and the process confusing.

Sonntag's review opened the door for a recent study by the state Health Care Authority, which pointed toward a consolidated purchasing system among public-school employees.

The current system covers 100,000 employees with significant inequities in cost and coverage between teachers and classified employees, and unmarried individuals and families. The new approach would create a benchmark plan and shift the cost of richer benefits to employees. Likewise, they would receive the savings of a less-expensive choice.

An oversight board made up of equal numbers of state, school district, employee representatives, and those with product expertise would manage the new system. A similar template is working in Oregon, and saving money.

The current system can price families out of coverage, while letting individuals skate by with no premiums. The current program is purposefully murky with management fees and little or no information about true overhead costs and what is paid for. Cozy in the extreme.

State Sen. Steve Hobbs, D-Lake Stevens, has fought the good fight for SB 6442, which remains in play. Over in the House, HB 2724 has not budged. Hobbs represents the legislative middle ground, which is behind this reform in both houses.

Taxpayers need protection, and school employees with dependents need coverage. These reforms would provide both.

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