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Originally published Thursday, February 2, 2012 at 8:10 PM

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Consolidate health-care system? Bill splits school-worker unions

The proposal, which moved out of a state Senate committee Thursday, has drawn strong opposition from the state teachers union.

Seattle Times education reporter

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A bill working its way through the Legislature has triggered something of a bizarro world in Olympia, with liberals lambasting a government takeover of health care and two of the state's most powerful unions fighting each other.

The proposal seems mild enough, although complex: Senate Bill 6442 would repeal the current K-12 employee health-care system, in which each of the state's 295 school districts separately negotiate private insurance plans with individual unions. Instead, insurance for all would be controlled by a state board.

Supporters say the consolidation would save money and enable the system to more fairly serve all by making it easier for school support personnel such as janitors, lunchroom workers and bus drivers to add dependents to their plans.

But opponents contend costs would actually rise because the government would be less efficient than the private sector. In addition, they argue, the plan would lead to a reduction in benefits for some teachers and a transfer of collective-bargaining power from the local to state level.

The bill moved out of the Health and Long-Term Care Committee on Thursday afternoon. It's expected to move next to the Ways and Means Committee before getting a full vote in the Senate, where approval is expected. Passage in the House is less certain, but the legislation's sponsors are confident about its chances.

The bill's support in the Democrat-controlled Legislature comes despite strong opposition from one of that party's biggest allies, the state teachers union.

The union, called the Washington Education Association (WEA), believes the current health-care system is effective. That's not surprising, given that the union partners with a private insurance company, Premera Blue Cross, on a base plan that is used by 59 percent of employees. Union leaders also fear the new system would force them to pay more for the medical coverage they receive today.

"It will increase the costs to educators, reduce their benefits and increase state bureaucracy," WEA President Mary Lindquist said.

But the bill has strong support from another large union — the Public School Employees of Washington, which mainly represents school support workers. Those employees would benefit most from a section of the plan that would change insurance formulas to lower the cost for employees to add dependents to their plan.

"We have kind of a fight here between the classified and the certified education employees," state Sen. Steve Conway, D-South Tacoma, said in a hearing last week.

The push for consolidation of the K-12 employee health-care system is not a new one — it dates to at least the early 1990s.

The idea gained momentum last year when separate reports by the State Auditor's Office and the Health Care Authority found that consolidation could save the state as much as $90 million per year. The savings would come mainly from paring administrative costs involved in negotiations surrounding the 1,000 pools funding more than 200 different medical plans through 10 different insurance companies.

Opponents of the bill strongly dispute those reports. They argue the authors didn't consider several potential issues such as the loss of private-insurance tax revenue and the state's need to establish a reserve pool for its program. The opponents also note that the reports relied on limited data. That contention is doubtlessly true, but it's because the WEA and Premera Blue Cross wouldn't give the authors details about their widely-used plan.

The confusion surrounding potential savings is so great that both sides point to recent consolidation in Oregon as proof their side is right. A spokeswoman for that state's teachers union, which pushed the plan, did not return several phone messages.

The legislation's primary sponsor, state Sen. Steve Hobbs, said his plan would increase the number of school employees with health insurance. It would mostly benefit school support workers who can't afford the current costs to add dependents onto their coverage.

"I think that both sides need to look at this as an issue of fairness," said Hobbs, D-Lake Stevens. "If they really believe in helping the worker and defending the worker, they would go with the plan."

A spokeswoman for Seattle Public Schools said the district is studying the proposal but has not yet taken a position.

Brian M. Rosenthal: 206-464-3195 or brosenthal@seattletimes.com. On Twitter @brianmrosenthal.

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