Windham, NH 03087

WEA Contract Concerns #4

The following letter was sent to the Windham School Board on Sept. 2, 2015.

To the Windham School Board:

In my letter last week I outlined the potential huge costs associated with the looming Obamacare Cadillac tax which will take effect in 2018. The school board has a responsibility to the taxpayers to mitigate the affects of that tax while at the same time offer contract terms which are acceptable to the Windham Education Association (WEA.)

Employers in the private sector are adjusting their healthcare and other benefits to avoid the Obamacare Cadillac tax. Latest statistics show that less than 3% of private employers anticipate having to pay the tax. Governments, including state, local and local school districts will be hit disproportionately due to their “Rolls Royce Bentley” health plans. The Windham School District pays 94% of the WEA health insurance premium costs, while the average private sector employers pay 72%. The district is clearly out of balance with current realities.

I believe it is time for the WSB and the WEA to rethink the way teachers are compensated. It makes no sense for the district to continue to offer the current “Bentley” health and dental plan and pay for ever increasing health insurance premiums, especially when those premium dollars would be subject to the 40% Obamacare tax.

Young professionals in general do not tap into their health insurance benefits; usually only utilizing an annual check up, dental cleanings and an occasional prescription. The starting salary for our teachers is about $37,000, and the current cost of a WEA single person health plan with other health benefits (dental, FSA, etc.) exceeds the Obamacare threshold of $10,200 (for single person coverage).

Many districts are encouraging teachers to choose a lower cost health plan by paying a higher percentage of low cost plans (as high as 85%-90%) and a lower percentage for the higher cost plans (typically 70-75%). Some other districts are paying teachers a higher stipend for not taking the health insurance plan.

My proposal would be to do both. Scale back the district’s current “Bentley” health insurance plan with a “simple sedan;” and pay higher stipends for not taking the WSD health plan. The money saved in health premiums and avoidance of the Obamacare tax could be shared between WEA employees and the district. Taxpayers could enjoy a more stable and predictable tax rate.

A young single teacher may willingly give up the Bentley health plan in order to get a higher initial salary enabling them to pay other expenses like car loans, student loans and housing. The teachers under age 27, may also choose to tap into their parents’ health plan in order to receive the stipend for not taking the health insurance. More teachers with significant others may chose their partner’s health plan and raise their take home pay by qualifying for the no health insurance stipend.

For the district, the combination of fewer employees on the health insurance plan and a lower overall cost health plan could help stabilize the tax rate and move more of the taxpayers’ dollars into the classroom where it belongs.

Eileen Mashimo