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Fairbanks borough officials appeal to lawmakers to stop insurance bill

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Posted: Friday, February 7, 2014 12:00 am

JUNEAU — While the state of Alaska’s health care plan costs have gone up 31 percent during the past three years, the Fairbanks North Star Borough School District’s health plan costs have gone up 17 percent and the Fairbanks North Star Borough’s plan dropped 4 percent.

That’s why on Thursday borough officials made an appeal to the Interior delegation to stop Senate Bill 90, which would force the Fairbanks North Star Borough School District to join the state’s insurance plan.

Senate Bill 90’s pitch is that combining each school district’s health plans will pool health insurance rates and, through economies of scale, save money for everyone.

Borough Human Resources Manager Sallie Stuvek told the Interior delegation at a lunch Thursday that just doesn’t pencil out for the borough.

“With a scheme like that there’s going to be winners and losers,” she said. “The borough has a well-managed plan, and they’re more likely to pay more under SB 90.”

Stuvek explained that unlike other municipalities, it self-insures by combining the health plans of borough and school district employees. The borough then “aggressively” managed its health plans by negotiating with health providers and with unions to keep rates down.

“If we actually thought it would save our taxpayers money, we would be in support of that, but our research has shown it will cost us,” she said.

Sen. John Coghill, R-North Pole, called the borough’s situation “a pretty good setup.”

Senate Bill 90 is in the Senate Finance Committee, which Sen. Pete Kelly, R-Fairbanks, co-chairs. Kelly attended the borough’s meeting and said he liked what he was hearing from the borough but had a warning about education.

“We want this to work; if it doesn’t, we’re not going to do it,” he said. “What I would like you all to consider, and you guys have done a good job, but our big driver down here is the cost of education. … I encourage you to keep doing this, but we need some more innovation from you.”

Borough Mayor Luke Hopkins responded that the problem of health care costs doesn’t rest with the borough’s policies, it rests with the state’s.

“The state of Alaska has to sharpen their pencils,” he said. “Lean on them from the Legislature to the administration.”

Senate Bill 90 was introduced late in last year’s session by Sen. Mike Dunleavy, R-Mat-Su, and was fast-tracked until it stalled in the Senate Finance Committee. The bill has not received more action this year, but the committee requested additional money to study the bill’s impacts earlier this week.

Contact staff writer Matt Buxton 

at 459-7544. Follow him on Twitter: @FDNMpolitics.  

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