Lower Healthcare Costs Allow LCPS to Reduce Insurance Rates

 

In an era when healthcare costs are rising and many workers must pay more dollars for fewer benefits year after year, Loudoun County Public Schools has managed to reverse those trends. Employees and taxpayers alike are benefitting.

 

Through an aggressive strategy to manage healthcare costs, the 12,000-employee school division has been able to reduce employee premiums by 5 to 10 percent for healthcare benefits in 2020. Employees also will benefit from six premium ‘holidays’ – pay periods when no health-insurance premiums are deducted from employee paychecks. The LCPS staff recommendations for these actions were accepted by the Loudoun County School Board at its regular meeting on Tuesday, Sept. 24.

 

Dr. Eric Williams, superintendent for the division in Northern Virginia, said, “We are very proud of the academic achievements of our students, and we are also proud of our ability to achieve results like this through the effective management of Loudoun County Public Schools’ business operations. I commend both staff members and School Board members for their work on our health insurance plan. These cost savings deliver real benefits to our employees, effectively increasing their compensation, and they allow us to return unused funding to Loudoun County taxpayers.”

 

Over the five years that Williams has been superintendent, the district has recovered from a healthcare-reserve deficit of approximately $13 million, and potentially will return millions of budgeted healthcare dollars to the county government at the end of fiscal year 2020 next June. With School Board support and approval, those savings have been achieved through a three-tiered strategy that includes wellness promotions, education on good healthcare buying habits, and plan changes such as the introduction of a high-deductible coverage option.

 

The strategy’s wellness programs promote healthy living through weight management, healthy eating and fitness. Offerings include free access to the Naturally Slim program, an online weight-management system that helps users learn to eat healthier, more nutritious diets; a Community Supported Agriculture (CSA) program that connects participants with fresh local produce suppliers; and healthy cooking programs, to help employees learn how to prepare healthy, nutritious meals.

 

Equally important, employee engagement and education efforts encourage and promote comparison shopping for services by employees. A monthly E-magazine reinforces and reminds employees about wellness programs and benefit offerings as well as promoting best practices and effective consumerism.

 

Finally, the school administration has focused on insurance-plan design changes such as the introduction of a high-deductible health plan with a health savings account, better negotiated contract terms and conditions with health care providers, and enrollment in medical and pharmacy management programs focused on specific services or medications. Among them, LCPS enrolled in a Diabetic Management Program with ExpressScripts, a national pharmacy-benefit management organization, to help better manage the costs for diabetic medications.

 

Evidence that the program is working extends beyond the financial benefits. Hope Hanes, an art teacher at Sanders Corner Elementary School in Ashburn, reports that getting a FitBit and starting a beekeeping operation helped improve her overall wellness.

 

“Between the maintenance of our acreage, gardens and the apiary, I get lots of exercise!” Hanes said. “Weekly inspections of the hives involve about 2 hours of intermittent weightlifting since each box weighs 30-50 pounds and must be moved a few times. Add in the push-mowing, weed-whacking and general yard work, and I easily exceed 10,000 steps per day.

 

“This lifestyle shift is much more sustainable for me because I feel more productive than if I were to just go to a gym for a workout,” Hanes said.

 

The cost improvements have been achieved even as the school system has grown, according to Sharon Willoughby, LCPS’ assistant superintendent for Business and Financial Services.

 

“While national healthcare costs have been growing at approximately 6 percent or more annually, LCPS has constrained growth to about 5.5 percent per year,” Willoughby said. “Importantly, that growth rate includes the additional expenses of about 22 percent more employees and their dependents than five years ago. We think that’s pretty remarkable, and are focused on doing what we can to maintain that efficiency into the future.”