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School Board's health care reserve drying up

January 23, 2002

School Board's health care reserve drying up



By TARA REILLY

tarar@herald-mail.com

The Washington County Board of Education has been told its health care reserve might be in the red by the end of the school year.

Chris South, the board's director of finance, told the School Board Tuesday morning that the $650,948 reserve could be depleted and in the negative, depending on the amount of the claims that the board must pay out by the end of the year.

He told the Washington County Board of Commissioners Tuesday afternoon that the reserve could end up $300,000 in the red.

The Board of Education is self-insured, which means that health insurance claims are paid by money contributed by employees and the School Board.

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The School Board uses the reserves to pay for claims when the claims exceed the amount the board has budgeted for health care, school officials have said.

Last fiscal year, the board had proposed budgeting $2 million for health insurance, but budget cuts knocked the amount down to $250,000.

The amount budgeted for reserves varies and is based on past experience with claims paid, school officials have said.

This is not the first time the School Board has had concerns about its health reserve.

In the last half of the 2001 school year, the board paid out $960,000 in claims, which put the reserve $254,000 in the red to start this school year, South said. Employee and board contributions toward the reserve have replenished the reserve to its current amount.

"That could be wiped out very quickly if we have the same type of year that we had last year," South said.

School officials have said the highest claims usually are paid in the last half of the school year.

The County Commissioners said last summer that the School Board could ask the county for help if the reserve got too low.

"They told us if we're in trouble they will try to help us out, and I'm holding them to that," School Board member Doris Nipps said.

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