The TRS ActiveCare health insurance program for Texas public school districts has enjoyed stable rates and comprehensive coverage since 2003. Approximately 87% of Texas public school districts have joined the program. Most recently the El Paso Independent School District (+8,000 employees) joined effective January 1, 2011 (http://blog.riskmanagers.us/?p=4824).
A brief review of the TRS ActiveCare financials (TRS 2009 CAFR ActiveCare) indicates an erosion of plan assets. Most recent paid claim experience shows a loss ratio of 98.7%. Last year the trustees of the program raised premium but offset some of the increase by dipping into plan reserves. It does not appear they will have that luxury this year.
A 98.7% loss ratio deserves a rate increase. With ObamaCare mandates in play, and +$20 billion state budget deficit to be addressed in the current legislative session, what will the trustees do this year to ensure the continued solvency of the TRS ActiveCare plan? And where is the money to come from?
Rates for plan year 2011-2012 should be announced in March.
