No change to K-3 poverty class size reduction vs No change to National Board Certification Bonuses vs

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1 There is $0 gap impact f the cnference budget vs current budget assumptins unless smene can quantify the admin pain f the K-12 health benefits bill. Belw is the cnference budget summary. Seattle Public Schls Impact f Cnference Budget N change t K-3 pverty class size reductin vs N change t ALE vs N change t Natinal Bard Certificatin Bnuses vs N change t Readiness T Learn, Navigatin 101, and Washingtn Reading Crps vs N change t Running Start maximum cmbined enrlled FTE vs The Levy Base Inflatr is nt changed fr 2013 levy cllectin. Pensin, Medical and Medical Retiree subsidy rates are the same as current budget develpment assumptins. MSOCS are the same as current budget develpment assumptins. $2M funding is prvided netime fr 3 2 schls fr Urban Schl Turnarund. N Apprtinment payment shift. N LEA payment shift r LEA reductin. $5.8M is allcated statewide fr Teacher & Principal Evaluatin System $250K is allcated statewide fr nline curriculum library. Alternative early retirement ptin will nt be ffered fr new hires n r after May 1, Belw is an excerpt frm 2ESB 6378 (c) Members wh first becme emplyed by an emplyer in an eligible psitin n r after May 1, 2013, are nt eligible fr the alternate

2 early retirement prvisins f (a) r (b) f this subsectin. Any member wh first becmes emplyed by an emplyer in an eligible psitin n r after May 1, 2013, and has cmpleted at least thirty service credit years and has attained age fifty-five shall be eligible t retire and t receive a retirement allwance cmputed accrding t the prvisins f RCW , except that a member retiring pursuant t this subsectin shall have the retirement allwance reduced by five percent per year t reflect the difference in the number f years between age at retirement and the attainment f age sixtyfive. HB2824 passed. This bill repeals the statutry requirement t prvide funding in specified annual amunts fr I-728 (Student Achievement Prgram) and remves statutry references t I-728 and prvides that any funding previusly dedicated t I-728 frm excess lttery funds and the Educatin Legacy Trust Accunt ges tward supprt f the cmmn schls (Basic Ed Frmula). Ghsting f unfunded I-728 in the levy base calculatin is nt eliminated, see HB2824 excerpt belw. HB2824 Sectin 1.3 Nthing in this act alters r amends the elements included in the schl district levy base set frth in RCW

3 In RCW (ii) Fr levy cllectins in calendar years 2011 thrugh 2017, the difference between the allcatin rate the district wuld have received in the prir schl year using the Initiative 728 rate and the allcatin rate the district received in the prir schl year pursuant t RCW 28A multiplied by the full-time equivalent student enrllment used t calculate the Initiative 728 allcatin fr the prir schl year; and SB5940 passed. Belw is WSSDA s summary f K-12 Health Benefits Bill SB5940. Nn-cmpliance penalties are highlighted. Legislature passes K-12 health benefits bill Here are the main cmpnents, as passed the Legislature tday: All emplyees in pling arrangements wh chse medical benefit cverage must pay a minimum premium, subject t cllective bargaining. Emplyees wh chse a richer benefit plan must pay higher premiums. Schl districts that ffer medical, visin and dental benefits are required t: 1. Offer a high deductible health plan ptin with a health savings accunt; 2. Make prgress tward emplyee premiums in which the full family cverage is nt mre than three times the premium fr an emplyee purchasing single cverage fr the same cverage plan (with ne exceptin); and 3. Offer at least ne health benefit plan in which the emplyee share f the premium cst fr a full-time emplyee des nt exceed the share f premium cst paid by a state emplyee. 4. In additin, schl districts must use an pen cmpetitive prcess t purchase services, except where an pen prcess wuld cmprmise cst-effective purchasing; and 5. Make prgress n prmting health care innvatins and cst savings, including significantly reducing administrative csts. Reprting n health benefits infrmatin is expanded frm current law, and failure t reprt wuld trigger penalties, described at the end f this summary. Schl districts and their benefit prviders wuld be required t annually reprt infrmatin and data t Office f the Insurance Cmmissiner (OIC) fr the prir calendar year. Elements include: Prgress tward greater affrdability fr full family cverage, health care cst savings, and significantly reduced administrative csts; Offering a high deductible health plan ptin with a health savings accunt; A plan summary, which wuld include: The financial plan structure and verall perfrmance f each plan, including ttal premium expenses, ttal claims expenses, claims reserves, and plan administratin expenses, including brker fees. A descriptin f the plan s use f innvative health plan features; Data t help external audiences understand emplyee health benefit plan cverage and csts, including the ttal number f emplyees and, fr each emplyee, the emplyee s

4 FTE status, types f cverage r benefits received, number f cvered dependents, the number f eligible dependents, the amunt f the district s cntributin t premium, additinal premium csts paid thrugh the emplyee s payrll deductin, and the age and sex f the emplyee and each dependent. Data t help districts mre effectively and cmpetitively manage and prcure health insurance plans fr emplyees. Infrmatin must include: a summary f the benefit packages ffered t each grup f district emplyees, including cvered benefits, emplyee deductibles, c-insurance and c-payments, the number f emplyees and their dependents in each benefit package; aggregated emplyee and dependent demgraphic infrmatin, including age band and gender, by insurance tier and by benefit packages; ttal claim payments by benefit package, including premiums paid, inpatient facility claims paid, utpatient facility claims paid, physician claims paid, pharmacy claims paid, capitatin amunts paid; and ther claims paid; ttal premiums paid by benefit package; a listing f large claims (mre than $100,000), including the amunt paid, the member enrllment status, and the primary diagnsis A descriptin f hw districts are reducing administrative csts, imprving custmer service, reducing the differential plan premium rates between emplyees nly and family health benefit premiums, and prtecting cverage fr part-time K-12 emplyees. All f the schl district and benefit prvider data and infrmatin will be cmpiled by the OIC, wh will submit a reprt t the Gvernr, the Legislature, and the Health Care Authrity n an annual basis by December 1, beginning in The reprt will include a summary f each schl district s health insurance benefit plans and each district s aggregated financial data and ther submitted infrmatin as described abve. OIC may adpt rules t meet the reprting requirements. The OIC is required t cnsult with schl district representatives n the reprting. By June 1, 2015, the state Health Care Authrity must reprt t the Gvernr, Legislature and the Jint Legislative Audit and Review Cmmittee (JLARC) infrmatin, based n tw years f schl district reprts n health benefits. HCA will establish a specific target t reach the gal f greater equity between full family cverage and emplyee nly cverage n the same benefit plan. HCA will cnsider the apprpriateness f the 3 t 1 rati r alternatives. HCA will als study and reprt the advantages and disadvantages f: Whether better prgress n legislative gals culd be best achieved thrugh cnslidatin f schl district health insurance purchasing thrugh a single, cnslidated schl emplyee health benefits purchasing plan; Whether better prgress wuld be achieved by using the PEBB, and if that wuld be preferable t creating a separate system; Whether certificated r classified emplyees, as separate grups, wuld be better served by purchasing health insurance thrugh a single cnslidated schl emplyee benefits plan r participatin in PEBB; and

5 An analysis f the implicatins f varius ptins n csts t the state and schl emplyees, impacts fr existing purchasing prgrams, and a prpsed timeline fr implementatin. By December 31, 2015, JLARC must review the schl district reprts submitted by OIC, and make its wn reprt n the prgress schl districts and their benefit prviders are making in achieving legislative gals f transparency, equity, and affrdability. JLARC is als directed t review and make recmmendatins n the value f alternative health benefit purchasing systems fr K-12 schl emplyees. The Legislature is directed t take all steps necessary t implement the recmmendatins f JLARC unless the Legislature adpts alternative strategies t meet its gals during the 2016 sessin. The bill als includes an incentive fr schl districts t cmply with the requirements. In Sectin 7(4)(a), JLARC is authrized in the schl year t determine which schl districts have met the legislative gals and requirements f the act and will rank rder them frm highest t lwest in terms f their perfrmance. The cmmittee shall allcate perfrmance grants t the highest perfrming districts frm a perfrmance fund f $5 millin apprpriated fr this purpse. Perfrmance grants wuld be used t reduce emplyee health insurance cpayments and deductibles, with the gal f the grant t have a meaningful impact in the district. Hwever, if JLARC determines that districts and their benefit prvides have nt made adequate prgress, in the judgment f the cmmittee, then the reprt t the Legislature must cntain advantages, disadvantages and recmmendatins n: Why mre prgress wasn t made; What legislative r agency actins wuld help remve barriers t imprvement; Whether schl district health insurance purchasing shuld be thrugh a single cnslidated schl emplyee health benefits purchasing plan r thrugh the PEBB; and Whether certificated r classified emplyees, as separate grups, wuld be better served by purchasing health insurance thrugh a single cnslidated schl emplyee health benefits purchasing plan r thrugh participatin in PEBB. Regarding the penalties, if the OIC determines that a schl district has failed t cmply with the reprting requirements fr tw reprting perids, the OSPI is required t limit the schl district s authrity t ffer health benefits t emplyees nly thrugh the state PEBB system. If the nncmpliance in reprting is caused by the benefit prvider, the OIC may take enfrcement actins under Title 48 f the Revised Cde f Washingtn. The data reprting requirements apply t schl districts that are self-insured. Failure t cmply wuld result in a lss f self-insured status. Lawmakers in bth chambers said they expected the bill wuld require sme adjustments ver the next few years as schl districts wrk with their prviders and emplyees t mdify plans and cmply with the reprting requirements. That said, prpnents said the bill ffered a psitive step frward t meeting the legislative gals f transparency, equity, affrdability, and savings fr health benefits prvided t schl emplyees. WSSDA will be wrking with districts and ther educatin rganizatins t help explain the bill and legislative expectatins, as well as identify cncerns and areas fr imprvement fr the 2013 sessin.