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NEW HEALTH-CARE CONTRACT ENABLES SCHOOL SYSTEM TO AVOID MORE THAN $23 MILLION IN FUTURE COSTS

Anne Arundel County Public Schools will save more than $23 million in future health-care costs under a new contract approved by the Board of Education.

The four-year, $20.3 million contract with CareFirst approved by the Board at its September 11, 2013, meeting contains a renegotiation of the current agreement that will save $5.9 million this fiscal year. It also decreases dental administrative fees and stabilizes administrative fees for medical and vision plans for the school system through December 31, 2017.

“This is another in a series of efforts on the part of our school system to, where possible, seize opportunities to reduce costs and fees throughout our operation,” Chief Operating Officer Alex L. Szachnowicz said. “It is our responsibility to demonstrate to the public that we are prudent stewards of the resources provided to us. In the health-care field alone, where costs continue to rise, we have now avoided or saved more than $70 million in potential cost increases since 2008. That is a clear demonstration that we are diligently carrying out our responsibilities.”

In addition to the $23 million cost avoidance in the new contract, initiatives undertaken by the school system or approved by the Board of Education and employee bargaining units to avoid or save costs include:

  • $2 million through a 2008 renegotiation and extension of the contract with CareFirst.
  • $1.2 million through a 2011 renegotiation of the contract with CareFirst.
  • $30 million through new negotiated agreements and plan redesigns with all four employee bargaining units approved in 2011.
  • $10.8 million through approval of a new 2012 prescription drug contract. Anne Arundel County government piggybacked on that contract to save an additional $6.8 million.
  • $5 million over the next five years through a 2013 audit that removed ineligible dependents from employee benefit plans.