Bill would open state health plan to schools

LANSING, Mich. - Schools and local government units would be allowed to enroll their employees in the state government health insurance program under legislation proposed by state Rep. Cindy Denby, R-Handy Township, the Lansing State Journal reported.

While the local units would still pay the full cost of employee insurance under House Bill 4181, they might be able to attract better rates by joining the state pool, according to the Journal.

The state purchases health coverage from Blue Cross Blue Shield of Michigan and administers the plan through the state Civil Service Commission, the Journal reported. It was unclear how much it would cost to expand that system to include large numbers of school and municipal employees.

A spokesman for the Michigan Education Special Services Association, a third-party administrator that already sells Blue Cross insurance plans to a majority of Michigan school districts, questioned any potential savings and said it might be less expensive for local municipalities to purchase insurance directly from Blue Cross Blue Shield, rather than through the state.

Gary Fralick, director of communications and government relations for MESSA, an affiliate of the Michigan Education Association, told the Journal, "Probably a more effective option for public employers would be to approach the Blues directly."

Fralick told the Journal that the association does not view the proposal as a threat to MESSA, saying it welcomes competition "as long as it's a level and fair playing field."

Government leaders told the Journal that they would support the plan as long as it remains voluntary. Whether any individual school or municipality would save money depends on the type of plan and level of coverage it offers employees, according to the Journal.

Lansing State Journal, "Bill would let schools, governments join state's health plan," Feb. 19, 2009

Mackinac Center for Public Policy, Michigan Votes, "2009: House Bill 4181," Feb. 6, 2009

Michigan Education Report, "Blue Cross and MESSA," Sept. 6, 2006