Deal’s Proposal to Cut School Worker Health Care Won’t Save State Much
(APN) ATLANTA — Despite media reports to the contrary, a proposal by Gov. Nathan Deal to cut health benefits for thousands of school bus drivers and cafeteria workers–who are for part-time, non-certified school district workers–is not projected to save the State of Georgia 103 million dollars.
If part-time, non-certified school employees lost their benefits, the State Health Benefit Plan (SHBP) would save only 2.6 million dollars, according to the Georgia Department of Community Health (DCH), which administers the Plan.
School districts would save an additional 79 million by not having to pay benefits for the employees who would no longer receive insurance, but that is not savings that would accrue to the State.
So far, the Legislative committees of purview have not been supportive of the proposal.
Some reports have said the State would be the one saving money, while others have not specified what entity would recoup the purported 103 million dollars.
The Atlanta Journal-Constitution appears to have helped start the confusion in an at least one article, including one on February 09, 2015, referencing “Deal’s proposal to save $103 million by discontinuing state subsidies for health insurance for about 11,500 part-time school staffers.” The Times-Herald of Newnan is one of several sources that reported the number as well; the Times-Herald cited the AJC.
In more recent reports, the AJC appears to have back-tracked on the 103 million dollar figure.
“The governor’s budget office said it would save about $81 million, down from $103 million state officials had earlier stated. DCH officials said it would save even less,” the AJC reported on February 10, 2015.
The 81 million dollars figure appears to be an intermingling of the 2.6 million dollar savings to the SHBP with the 79 million savings to school districts.
“The Department of Community Health said it would only save the state $2.7 million, while administration officials and lawmakers put the savings at $81 million,” the AJC reported on yesterday, February 25, 2015.
Source A says one thing; source B says another; we report, you decide? No. Gov. Deal isn’t entitled to his facts. There’s a factual explanation for the two different figures, one that readers are capable of understanding.
2.6 million dollars is a drop in the bucket of SHBP’s deficit, and is only 2.5 percent of purported savings of 103 million dollars.
“When lawmakers are debating whether to take away health benefits from these workers, the value of the savings is a really important point,” Tim Sweeney, Health Policy Director for the Georgia Budget and Policy Institute, told Atlanta Progressive News.
It appears the initial confusion regarding the purported 103 million stems from a conflation of two separate recommendations in the section of the Governor’s budget dealing with the SHBP.
One of those recommendations is to cut the insurance for certain workers; the other deals with an unrelated reduction in employer contribution rates.
On page 137, they read as follows:
- Delay the implementation of the scheduled increase of the employer contribution rate for non- certificated school service employees from $596.20 per member per month to $746.20 per member per month, deferring the collection of an estimated $102,825,000 in revenue for the SHBP.
- Effective January 1, 2016, eliminate SHBP coverage for non-certificated public school employees, as defined in OCGA §20-2-910, who work, on average, fewer than 30 hours per week.
Number 11 requires a bit of background to understand.
State agencies and school districts are required to pay into the SHBP as employers.
Prior to the last recession, the State had been paying 280 million dollars annually directly into the plan on behalf of school districts. But over the course of the recession, that amount was deeply reduced and then eliminated altogether.
The legislature created a schedule of increases to the amount that school districts are required to pay into the SHBP, but Gov. Deal’s budget proposes delaying the increase that was set to go into effect this year. That is what recommendation 11 is about.
Delaying the increase would save school districts 103 million dollars, which is where that pesky figure comes from. However, the delay would cost the SHBP that same amount, because it is money that would otherwise go into the fund.
So rather than helping to close the SHBP’s 135 million dollar shortfall, this recommendation does the exact opposite.
Recommendation 12 is the one that proposes to eliminate benefits for bus drivers and cafeteria workers, which, again, would only save the State 2.6 million dollars.
School districts would save 79 million dollars by not having to pay into the fund for the workers whose benefits will be cut, but, again, that’s only because they’re having to step up where the State has backed out.
Gov. Deal has framed this as an issue of fairness, saying that because other part-time state employees do not receive benefits, therefore bus drivers and cafeteria workers shouldn’t have them either.
“This should not be a race to the bottom,” Alan Lee, Deputy Director of the American Federation of State, County, and Municipal Employees (AFSCME), told APN.
“It’s unfair that any state workers go without health benefits. Anyone who works hard should have healthcare just like bus drivers and cafeteria workers. It’s ironic the same Governor who turned away funding from the Affordable Care Act is now trying to eliminate health insurance for even more working people,” Lee said.
“It’s nothing more than sophisticated racism and sexism. Most of those bus drivers are people of color and women. They are the working poor and they are transporting our most precious cargo: children.”
The budget is currently under review by the House Appropriations Committee.