Texas School District Seeks To Exit TRS ActiveCare

Once enrolled on the TRS ActiveCare health plan, school districts are forever prohibited from leaving. There are no exceptions permitted. Or are there?

By Bill Rusteberg

Texas House Bill 1842, passed in the 84th Texas Legislature, permits public school districts to become Districts of Innovation and to obtain exemption from certain provisions of the Texas Education Code.

For example, once enrolled on the TRS ActiveCare health plan, school districts are forever prohibited from leaving. There are no exceptions permitted. Or are there?

One Texas school district wishing to exit the TRS ActiveCare program has seized this opportunity by declaring their district a District of Innovation for this sole purpose:

s3.amazonaws.com/scschoolfiles/1444/risd_dist_of_innovation-local_innovplan.pdf

Will other TRS ActiveCare district follow? Quite possibly since we know of others wanting to leave, including the El Paso Independent School District.  (El Paso ISD Votes To Leave TRS ActiveCare)

With the upcoming biennial session of the Texas legislature about to begin in January 2019, we expect to see bills similar to the ones introduced at the last session that would allow districts to move out of the TRS ActiveCare program. However, unlike the last time, any chance for success necessarily requires an “R” rather than a “D” following the name of the introducing legislator.

Some small districts are fearful that should others be allowed to exit the program rates would necessarily rise leaving them few options in the market. They point to the large TRS ActiveCare pool as the best safe harbor for their health insurance needs. However they fail to realize that even small districts join even larger pools than the TRS ActiveCare program through risk transfer techniques.

Two Texas school districts of less than 1,000 employee lives is a good example. These two districts have formed a risk pool cooperative with good success since 1999. Seven years ago they moved to Reference Based Pricing which has produced significant savings while improving benefits at the same time. (Write RiskManager@RiskMangers.us for details). Surrounding TRS ActiveCare districts view this success as proof viable alternatives exist in a market they are forbidden to enter.

The cost of health care in Texas has reach a tipping point. Cost shifting strategies have failed. Secretive managed care contracts crafted in smoke filled back rooms turbocharge ever rising health care costs cloaked in co-pays and deductibles leaving consumers clueless and careless to actual costs.

This upcoming Texas biennial session must address health care costs. But Has Texas Lost It’s Cajones?

Let’s hope not………………………………

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