Self Insurance Realizes Dental Plan Savings

This year's budget includes a new account for the District's newly established self-insured dental plan. The first year's results suggest that establishment of the self-insured plan, which replaces a plan underwritten by a major dental insurance carrier, will save somewhere between $100,000 and $200,000 per year. This year's savings will be placed in the self-insurance reserve. Actuaries recommend that when you self-insure, you should maintain sufficient reserves to protect yourself against fluctuations in usage. Once we have adequate reserves, the savings would most likely be used to reduce the premium cost resulting in savings to the district and to employees.

Replacement of our old plan with a self-insured plan resulted from an outside study that looked at our insurance operations. The savings realized from this study, and implementation of its recommendations, paid for the cost of the study many times over. This is an example of the benefits of the District's adoption in 2005 of a practice of regularly studying how we do business and where we can improve. Other studies have also led to major improvements that have led to cost controls or other savings. The cost of outside studies are booked to the school board's budget, because they are part of the public accountability function. We select study topics in consultation with the superintendent and the executive staff. Sometimes, the study topic is selected because there is a concern that a department, or part of our operations, seem to need improvement. Sometimes the study topic is selected because we receive expressions of concern that seem to warrant review with an independent eye. Sometimes the consultant comes back and tells us, this is working really well. Keep up the good work. Usually, we get good advice on how we can do things better.

Another reason for using independent expertise in this fashion is that sometimes we feel that we have to defend doing things just as they have been done in the past. Using outside expertise from time to time is a great way to develop support for making needed change. Also, it avoids having board members try to micromanage operations and operational change. Instead of saying that a constituent is complaining about bus service, or insurance costs, for example, we can work with the Superintendent to identify areas that would benefit from review. Instead of implementing a board member's individual idea of how things ought to be changed, based on a brainstorm that he got some evening over a beer, we foster a cycle of continuous improvement, using outside expertise and the good ideas of our employees.

The independent review concept was a pledge that was made to the voters back in 2003 when the previous operating referendum was passed. The Board promised regular outside reviews of our operations to assure that we were implementing efficiencies. The cost of these reviews has been relatively small, and the savings and efficiencies implemented as a result, have paid for the cost many times over.