New Hampshire Cities Struggle with SchoolCare Assessment Payments

Dover and Portsmouth are now the only two members out of 90 that have not settled their assessment bills with SchoolCare, a nonprofit insurance risk pool. Should an agreement not be reached by May 1, SchoolCare plans to halt claim payments, potentially making city school districts or individual employees personally liable for healthcare expenses.

Officials from both cities have reassured that employees will maintain their health coverage. SchoolCare is actively pursuing these payments to close a gap in reserves necessary to cover insurance claims for school employees and to reinforce their financial stability.

Lisa Duquette, the Executive Director of SchoolCare, explained the organization's function as a self-insured risk pool. Here, cities and schools collaborate to share financial risk, differing from traditional insurance models. Duquette stated, “Rather than purchasing commercial insurance, they combine their risks and purchase this coverage.”

New Hampshire Secretary of State David Scanlan endorsed this self-insurance model, which allows members to distribute the risk associated with health insurance provision. The assessments issued last fall totaled $30 million, with Dover and Portsmouth questioning their share in these ongoing financial obligations.

Duquette highlighted that SchoolCare, like many other health plans nationwide, faced unexpectedly high medical claims, leading to the need for assessments designed to restore reserves. The upcoming assessment period aims to ensure continued claim payments for over 20,000 public employees and their families.

Duquette also pointed out that SchoolCare's assessments impacted all 90 members; however, only Dover, assessed approximately $1.7 million, and Portsmouth, assessed about $1.57 million, have yet to agree to these payments. Portsmouth's proposed installment payment was rejected, as was Dover's undisclosed counteroffer.

The assessments are essential to bolster SchoolCare's reserves, particularly given post-pandemic claim surges. Scanlan underscored the importance of maintaining adequate reserve levels, highlighting that while HealthTrust managed similar challenges without assessments, SchoolCare’s reserves were insufficient. This financial strain underscores the members' liability for any claims, emphasizing the need for careful risk management within self-insured risk pools.