New Mexico Public School Insurance
Like any large organization that looks at the rising cost of insurance premiums and at the rising cost of health care in general, the teachers and administrators of the public school system in New Mexico decided to use their strength in numbers to get affordable insurance. Public school insurance coverage began in 1986 when the state legislature created the New Mexico Public School Insurance Association. The group included public school districts, charter schools and post-secondary educational institutions. The entity was created not to fund its’ own coverage but to act as a purchasing agent for the group. Through the organization, member schools can offer employee benefits and risk coverage. The lone exception in involvement was the Albuquerque school district.
The association is overseen by an 11-member board that monitors the rules and regulations and provides administration for the day-to-day operations. These board members answer to the teachers, principals and other ancillary professions that make up membership. The group includes over 30,000 educational employees and their dependents. The purchasing ability of such a large bloc of consumers has allowed the entity to negotiate more reasonable premiums and benefits than individual districts would be able to. A smaller group would be more vulnerable to the ups and downs of claims, but the size of the group makes claims more predictable and allows them to keep premiums at a reasonable cost.
The members share the disability, medical, dental and vision costs. One-third of the total cost of the funds are covered by association payroll deductions. Compared to the cost of other conventional insurance plans, this should represent a considerable savings to the group as a whole.
The medical plans are usually self-insured. This means the group is caretaker for the design of the plan and scale of the contributions. These rates cover the revenue for claims the group incurs. Like any insurance concern if the claims go up, so must the premiums. That is why less than 10% of the contributions go to overhead.
The association covers 82 charter schools, 23 other educational districts, and 4 self-pay groups. Each group can choose which coverage they want or need. The choices include basic life, accidental death & dismemberment, voluntary life, disability, dental, vision and two medical plans. Property, liability, workers’ compensation and student accident coverage are just some of the risk coverages that are included.
Public school insurance has worked well for the educational community in New Mexico. When you consider the rising costs of health care and the premiums that go with it, it is no wonder that groups like the one in New Mexico are finding it wise to find strength in numbers. Should the health care system continue to become more expensive, more groups like this one will surely band together.
Visit Public School Insurance Indiana for more information or visit our blog at http://51weeks.com/public-school-insurance/.