PreferredOne supports district's transition to a self-funded health plan

From skeptic to champion, Richard Kreyer, Human Resources Director for St. Louis Park Schools, shares his district's journey to self-funded success

 
When it comes to employee health plans, the less drama, the better. That’s the message from Rick Kreyer, Director of Human Resources with St. Louis Park Schools.
 

Rick has a long history with Minnesota’s schools and health plans. Before joining St. Louis Park, he worked for districts in Minneapolis and St. Paul. He’s witnessed a lot of drama: breathtaking rate increases; moving from one plan to another—repeatedly; plans where claims weren’t paid for months (or plans that paid claims that shouldn’t have been paid). “It can be a roller coaster,” Rick said.

That ride came to a happy end in 2018 when Rick and a team from St. Louis Park schools took a calculated risk: self-funding the district’s health plan with PreferredOne.

The business case was compelling

Rick freely admits he was not a PreferredOne supporter. He hadn’t worked with the company and he certainly wanted no part of self-funding. When the district’s consultant introduced the concept, Rick envisioned disaster. But with more than 500 employees, the business case was compelling.

“Our consultant helped guide us through the ins and outs of self-funding,” he said. “And the people at PreferredOne got me and my team on board, as well as our union representatives. They earned our trust and confidence. The folks at PreferredOne are so human—very personal and real. They understood my reluctance and promised they would make it okay: and they did.”

“It turned out that self-funding went better than projected. Better financially, plus the transition to PreferredOne as our TPA was virtually flawless. Our staff adapted so smoothly: there was almost no disruption with their doctors or clinics.”

Terrified it wouldn’t work

“Still, that first year, I was terrified it wouldn’t work,” Rick said. “It turned out that self-funding went better than projected. Better financially, plus the transition to PreferredOne as our TPA was virtually flawless. Our staff adapted so smoothly: there was almost no disruption with their doctors or clinics. Between our account manager at PreferredOne and the customer service team, the transition exceeded our expectations.”

“You know,” Rick said, “it’s so disruptive to move a large group from one carrier to another. And the cycle of moving and not knowing what to expect year over year is exhausting. To find a solution and a partner to end that cycle has been wonderful.”

PreferredOne took away that fear

“I’d been with fully insured carriers my whole career. I worried about risks with self-funding. But PreferredOne took away that fear. It feels good to look under the hood and see how health insurance works. We understand our numbers and our data. We see where we can make an impact not only financially, but for our district’s overall health.”

“We’ve had mostly good years. There will be bad years and we’re prepared for that. Our reserves have increased each year. We see that we will be able to manage the spikes and valleys. That level of predictability feels good.”

Now the district decides when to adjust rates and by how much

Plus, Rick said, now the district decides when to adjust rates and by how much. “We’ve had several modest increases as we work toward our reserve goal. In a challenging year, we can reduce or even eliminate increases. That level of control and the confidence it gives our district is probably the biggest win.”

“PreferredOne is not an evil insurance company trying to make money off us. Instead, they are a careful and thoughtful partner to us. They treat our money as though it was their money.” “We’ve had mostly good years. There will be bad years and we’re prepared for that. Our reserves have increased each year. We see that we will be able to manage the spikes and valleys. That level of predictability feels good.”

“We are happy to put the drama behind us."

 

Support for self-funded district health plans

Self-funding a health plan requires planning and collaboration across many different groups. Educating leadership and staff, union representatives, board members and the broader community is vital.

Building knowledge and support

A starting point for many districts is the Self-Funded User Group (SFUG), a forum open to all districts regardless of their health plan vendor or consultant. The group meets monthly in Minneapolis. It provides a roadmap for those interested in learning about self-funding and continues to support plans with open conversations about ongoing challenges and opportunities. The group also presents workshops at Minnesota School Board Association (MSBA) annual leadership conferences.

Learn more about the Self-Funded User Group

To be added to the group’s distribution list or for additional information, contact:
Dennis Dahlman at 612.750.9780 or dennis@ddahlman.com
Thom Sturgeon at 612.508.6889 or thom@self-fundedusergroup.org

Participating School Districts

2021.05 - QRF - Exchange - Individual and Small Group.pdf (73.01 kb)

 

 


 
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