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Ridgewood Sees Big Savings Switching Health Care Providers

Move to Horizon will save $1 million but won't impact this year's taxes, superintendent says.

For the second time in five years, school officials in Ridgewood have realized a big savings by switching health care providers.

According to Daniel Fishbein, the to the district has been cut in half with the jump from Cigna to Horizon Blue Cross Blue Shield.

The superintendent estimates it will save approximately $1 million with the move.

Because the $90 million 2012-2013 budget has already been passed and the tax levy set (at a flat 2 percent increase), the savings won't help out the taxpayer this year.

"It will most likely be reserved against future benefit premium increases," Fishbein said when asked how the money will be spent.

During the 2010-2011 budget year, a switch to Cigna saved about $1 million and helped the district mitigate what .

Dennis Martinez May 26, 2012 at 10:33 AM
This is nonsense. The original carrier was projecting a 20% rise in claims due to the continued poor claims experience. Claims jumped from $8.8 mm in 2011/12 to a projected $10.6 mm in 2012/13. The new carrier is using a lower expected actuarial claims number and the District is now suggesting that the difference between one carrier's estimate of expected claim costs and the new carrier's estimates result in a savings. Voodood economics? Yes. True savings- Give me a break. The basics of any self insured health care plan is simple. A certain portion of the 100% expected cost goes to projected claims ie. 85% and a certain portion to expenses and profit ie. 15%. All they are doing is lowering the expected claims costs and calling that a savings. At the end of the day (or year in this case) unless the plan design is changed, there will be no savings!
CPA May 26, 2012 at 11:59 AM
Horizon makes you jump through hoops to get all of the services your doctor recommends. MRI's require a 3rd party approval and they save money that way because of the delay of services and they point you to locations that offer it at a lower cost to them. They call it managed care. Dr. Fishbein is incorrect in his terminology unless it was reported incorrectly. You just can't put a reserve on the books if there is no substantiation behind the reserve. The new auditors should be able to direct the BOE in the correct reserve required. If you have details that support the number then hang it up on the balance sheet. If you don't you better not put up there.

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