Eye on Insurance
The beginning of a new year seems to be a perfect time to celebrate the
success of a remarkable idea – the idea that brought about the WEA
Insurance Trust. And, perhaps signaling an auspicious alignment of numbers,
the start of year 2000 will see the Trust insuring more than 200,000 individuals.
The story of the Trust is a good, old-fashioned American yarn about long
odds and the dedication and resourcefulness of ordinary Midwestern folks.
Our tale starts 30 years ago. Fed up with its members having to pay too
much for benefits and getting too little in return, WEAC asked a group
of leaders to figure out a better way to deal with benefits. Then, as
now, budgets were tight. Negotiators at the bargaining table were often
forced to choose between an increase in salary or forgoing the increase
to put the money into benefits. The benefit plans offered to school employees
were paltry at best.
A gutsy solution
“WEAC’s practice at the time was to endorse an insurance company
to provide benefits to members in school districts,” said Jan Virlee,
current chairperson of the WEA Insurance Board. “It was obvious,
though, that no matter which insurance company was picked, there was little
assurance members would come out ahead. So, this group decided the only
way to have a say in benefits was to develop a WEAC-sponsored program
through a Trust.”
This was a gutsy solution, considering that it would require, at least
initially, finding an insurance company to insure and administer the benefit
plans and then require the insurer to return some of the profits to the
Trust. Why would any insurer agree to this?
“They were a convincing bunch of educators,” said Virlee with
bemusement. “They told the insurance company that without the cooperation
of WEAC members, it wouldn’t do much business in school districts.
It was an audacious claim, but it worked.”
After a few years, the Trust took an even bolder step. Unhappy with the
high operations costs members were paying to insurers of the Trust-sponsored
plans, the Trust took over the funding and administration of its plans.
30 years later
Today, 78% of all school districts eligible to participate are insured
by a Trust health insurance plan. Similarly, more than 70% of school districts
have chosen Trust dental and long term disability plans. More importantly,
the Trust has set the standard for many of the benefits available to public
school employees.
For example, individuals covered under Trust plans get more for their
money than from any other insurer.
The Trust generally returns around 93 cents of every premium dollar in
the form of benefits – a remarkably high number. The Trust also introduced
a long term disability (LTD) plan that replaces 90% of a disabled person’s
income. Before the Trust, most public school employees had no LTD coverage,
and the few LTD plans in existence replaced only 67% of income.
In addition, the Trust has raised the bar for exceptional customer service.
As the accompanying chart shows, the Trust is far below other insurers
in the number of complaints filed against it.
Finally, the Trust cares about its members. In recent years, the Trust
has developed an array of programs and services designed to improve the
health and well-being of its members. Such services include NurseLine,
which provides confidential access to qualified nurses 24 hours a day,
a maternity education and screening program, and StayWell (a health promotion
and disease management program). In 2000, the Trust will assess the effectiveness
of a tobacco cessation and a weight management study, and will launch
Care24, a confidential member assistance program.
Posted February 22, 2000