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tcramer@postindependent.com
The Roaring Fork School Board voted unanimously on Wednesday to terminate its self-insurance health care plan, Think Health, effective Dec. 31.
The move follows significant financial losses under the self-insured model, raising concerns about its long-term sustainability. Beginning Jan. 1, the district will return to the Colorado Employer Benefit Trust (CEBT), a managed insurance plan that offers employee benefits to public institutions throughout Colorado, which the district had previously utilized.
The district faced significant challenges after implementing the self-insurance plan in July 2023. Noel Cruse, vice president of benefits for Segal Consultants, was brought in to provide a financial analysis and guide the board’s decision. Cruse highlighted the unpredictability of the self-insured model, especially for a group the size of Roaring Fork’s, with about 670 employees.
“A group of 670 people can be highly volatile,” Cruse said. “Larger groups can absorb spikes in claims more easily, but smaller groups can quickly experience significant financial losses when a few large claims come in.”
Cruse went on to explain that since the self-insurance plan began, the district had already incurred substantial financial losses. For the 2024-2025 plan year alone, the district was projected to lose $2.3 million, and if the district continued with the self-insurance model through June 2025, losses could rise to $5.5 million, with an additional $3.2 million in projected losses over the next six months.
“We did multiple different projections on this, just because of how sensitive it is,” Cruse said. “We can even push that loss up a little bit more, and that’s not to be a scare tactic. I just want to be realistic with you.”
District leaders recommended returning to CEBT as a way to mitigate financial risk and stabilize costs, even though the transition would result in an additional $1.2 million in premiums for the second half of the 2024-2025 school year. By switching back to CEBT, the district will transfer financial risk away from itself and avoid the unpredictability of the self-insured model.
Cruse also discussed the transition process and explained there would be a six-month run-out period for claims incurred before the switch on Jan. 1.
“If a member has a claim that they went out of network and they never submitted that claim in the plan at that point, after whatever the period is, all said, it’s not required to pay that claim,” Cruse said. However, in-network claims already in the system will continue to be processed.
Looking ahead, Cruse noted that CEBT has projected a rate increase of about 10% for the 2025-2026 school year, though there are options to mitigate those increases.
“It would look somewhere in the area of a 10% rate increase,” RFSD Chief Financial Officer Christy Chicoine siad. “They also added into the quote additional options that could significantly mitigate that if we moved to a higher deductible that might still be reasonable to employees.”
The board members discussed the financial burden of continuing with the self-insurance model. A district representative outlined the strain that the district was already under.
The district has already experienced $2.3 million in losses under the current self-insurance plan. Projections indicate that if the plan continues through June, an additional $3.2 million in losses could occur. To manage the administrative burden of the self-insurance model, the district would likely need to hire more staff, further increasing costs. Even with stop-loss insurance in place, the district faces significant additional expenses and cannot avoid further financial losses.
Superintendent Anna Cole echoed the need for a cautious approach.
“Our priorities right now were to mitigate the risk for our district,” Cole said. “This is not a space that we should be innovative in right now.”
The board’s decision to terminate the self-insurance plan and return to CEBT reflects the district’s focus on reducing financial risk and ensuring long-term stability. By moving back to CEBT, the district expects to save approximately $600,000 compared to continuing with the self-insurance model through June 2025.
District leadership is preparing for the transition, with open enrollment for employees set to begin soon. Leaders are also working on a revised budget proposal, expected to be presented in December, which will address the additional costs of the transition and outline a path for stabilizing the district’s finances as it heads into the 2025-2026 school year.
“We are really assessing what we can deliver in terms of managing health insurance as a small district, and that we then develop plans and can execute them effectively and responsibly so that we mitigate risk for our district,” Cole said.
As the Roaring Fork School District moves forward with its health insurance changes, district leaders remain committed to ensuring the process is smooth for employees and that the district’s finances are protected in the long term.
“The decisions we make as a district are, and must continue to be, centered on student success and our need to attract and retain highly qualified educators,” Board President Kathryn Kuhlenberg said in a news release from the district. “We are grateful for the representative employee leadership teams of Certified, Classified and Administrative Interest Based Bargaining who worked hard to represent employee concerns, interests, and priorities through this recommendation.”
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