SHARON School board agrees to switch to another health-care group

School officials became dissatisfied with an insurance program after it experienced cash flow problems.
SHARON, Pa. -- The city school district is dropping out of the Western Pennsylvania Schools Health Care Consortium.
The school board, expressing dissatisfaction with the employee health-care group's recent performance, voted 8-0 Tuesday, with School Director Kathy Hall absent, to quit the consortium and join another self-insurance group.
By the same 8-0 margin, Sharon then decided to join the Midwestern Health Combine, a group that serves other school districts in Lawrence and Mercer counties, as of July 1, said Melvin Bandzak, Sharon City School Board president.
Midwestern will provide the same coverage that Sharon employees now have at what is expected to be a slightly lower premium, Bandzak said.
Premiums
Sharon is paying Western Pennsylvania Consortium about $2.78 million in insurance premiums this fiscal year, which ends June 30.
The premium includes about $681,000 Sharon had to come up with in February when the consortium experienced serious cash flow problems and assessed its 12 school district members a total of $4.6 million in extra premiums. Sharon had to borrow the money to cover its share of that special assessment.
Bandzak said Sharon learned of some financial problems in the consortium last fall and began asking questions but was assured that all was fine. However, "the bottom dropped out in February," he said, adding that Sharon thinks the district will be better served in a new program.
Blue Cross administration
The Midwestern Health Combine is administered through Blue Cross, which has a proven record of performance, Bandzak said.
Benefits provided through the consortium were generic, with all participating members offering the same coverage to their employees. Midwestern allows each district to tailor its own insurance package, Bandzak said.