St. Paul’s teachers union offered Tuesday to delay its plan to switch health insurers — a move that has threatened to put a $4 million hit on the district’s budget.
But the proposal comes at a cost: The district must agree to boost individual and family benefits to reflect the savings that members could have received next year, or about $1.5 million total in 2019-20, Nick Faber, the union’s president, said Tuesday.
Superintendent Joe Gothard and Board Chairwoman Zuki Ellis had asked the St. Paul Federation of Educators (SPFE) to put off until 2021 its proposed move in January from the district’s current insurer, HealthPartners, to the state-run Public Employees Insurance Program (PEIP).
A switch next year would come in the middle of the district’s two-year contract with HealthPartners, triggering a $4 million penalty and putting employees from other unions at the risk of exorbitant premium increases.
SPFE officials presented the compromise offer to district leaders during a meeting Tuesday afternoon.
They requested a written response by the end of the week, according to a letter signed by Faber and Sylvia Perez, union director of nonlicensed personnel.
Federation members voted this spring to exercise their right to move to the state-run plan because of the potential for immediate savings and greater stability in health care costs.
The union’s offer Tuesday calls for the district to increase teacher benefits from $800 to $855 for single coverage and from $1,100 to $1,270 for family coverage. Educational assistants would see employer contributions rise from $635 to $740 for single coverage and $1,295 to $1,465 for family coverage.
The projected $1.5 million total cost would cover the fiscal year that runs from July 1 to June 30, 2020, Faber said.
The federation has come under fire for putting the district at risk of the $4 million termination fee. The union argues that while it notified the district in March that it was weighing a health care switch, the district did not share concerns about a potential $4 million penalty until it posted an FAQ online while SPFE members were voting on the proposal at the end of April.
Laurin Cathey, the district’s human resources director, said that the union never told the district when members would be voting.
Since then, federation efforts to persuade HealthPartners to waive the fee or reduce the penalty have been unsuccessful.