Alaska school districts are responsible for buying their own private insurance plans for staff, which are often expensive for districts and employees, both. But two bills working their way through the legislature would allow school districts and other state employee groups to opt into the state’s health care plan, which proponents say could save them money and help with staff retention.
The Kenai Peninsula Borough School District spends about 16% of its budget on health insurance for employees, or about $22 million a year. Superintendent Clayton Holland said it’s a cost that gets passed along to employees and is a major factor in the district’s struggles to recruit and retain teachers.
“People will come here, and if there’s a significant part of their paycheck that’s going to healthcare, it’s hard to keep them here, if there are options that might have better healthcare, or are less expensive,” he said.
That phenomenon is compounded by stagnant education funding from the state. The Base Student Allocation — the amount of money per student the state provides to districts — hasn’t meaningfully increased since 2017, and is a major topic in the legislature this session.
“People can leave the state now, and teach, and potentially make more money and pay a lot less for healthcare,” Holland said. “So it impacts us, for both recruitment and that retention piece.”
A House bill sponsored by Homer Republican Rep. Sarah Vance, and a companion Senate bill from Palmer Republican Sen. Shelley Hughes, would offer districts the option to address those woes by opting in to the state’s health care plan — currently used by state employees.
Holland has been a supporter of both bills, and submitted letters of support for each. He also testified this week before the House Labor and Commerce Committee, while they heard Vance’s version of the bill.
Each district would have the choice of opting into the state plan or sticking with private coverage for all employees. Holland said ultimately, whether the Kenai district opts in will depend on collective bargaining with the staff associations. He said the legislature is projecting that the state plan would be a savings for the district, but he’s still waiting on more data to know for sure.
But Holland is supportive of having more options for healthcare.
“The district pays 85% percent of healthcare costs, then our employees pick up the other 15%,” he said. “So there’s still a significant cost for employees, so anything we can do to potentially bring that down, for employees and for the district, we’re interested in.”
Vance’s bill remains in the House Labor and Commerce Committee. The bill on the Senate side is currently being held in Senate Education.
This story was supported by the Alaska Center for Excellence in Journalism's Legislative Reporter Exchange Program.
