ITEM NUMBER: 8.F.
School Board Regular Meeting
- Meeting Date:
- 04/06/2026
- Prepared By:
- Amanda Heilman
Item Type:
Subject:
Approval of 2026-2027 Employee Health Insurance Plan and Renewal Rates
Background:
On February 12, 2026, the District received seven bids for Employee Group Health Insurance. In compliance with the Health Insurance Transparency Act (HITA), the bids were opened in the presence of a representative from the MTA (Mankato Teachers Association), the District’s largest bargaining group.
On March 18, 2026, the District Employee Insurance Committee convened to review the bids and discuss the merits of each proposal. Following this review, the Insurance Committee and administration recommend continuing with Blue Cross Blue Shield as the District’s third-party administrator and medical plan provider. In addition, the recommendation includes carving out the pharmacy benefit manager to Crumdale, which will utilize Express Scripts for pharmacy services.
This recommendation results in a 9% premium increase across all health insurance plans, which is consistent with the current medical trend of approximately 9%–12%. The pharmacy carve-out was evaluated for potential cost savings and is estimated to reduce prescription drug costs by approximately 29.5%, or $2.1 million in our self-insured plan.
Key Considerations:
PLAN SINGLE FAMILY
Basic + $1,759.00 $4,738.00
$750 CMM $1,414.00 $3,731.00
$3400 CDHP $1,196.00 $3,161.00
$6350 CDHP $ 952.00 $2,515.00
On March 18, 2026, the District Employee Insurance Committee convened to review the bids and discuss the merits of each proposal. Following this review, the Insurance Committee and administration recommend continuing with Blue Cross Blue Shield as the District’s third-party administrator and medical plan provider. In addition, the recommendation includes carving out the pharmacy benefit manager to Crumdale, which will utilize Express Scripts for pharmacy services.
This recommendation results in a 9% premium increase across all health insurance plans, which is consistent with the current medical trend of approximately 9%–12%. The pharmacy carve-out was evaluated for potential cost savings and is estimated to reduce prescription drug costs by approximately 29.5%, or $2.1 million in our self-insured plan.
Key Considerations:
- Health Premium Increase (2026-2027): Despite the positive claims trend, we are recommending a 9% increase in health insurance premiums for the 2026-2027 plan year. It is important to note that this increase is lower than the regional trend, reflecting our ongoing efforts to manage healthcare costs effectively.
- CDHP 3300 Deductible Adjustment: Due to an IRS mandate governing High Deductible Health Plans, a minor adjustment to the deductible for the CDHP 3300 plan is necessary. The deductible will increase to $3,400 for both self-only and family coverage to maintain our current family coverage structure and comply with federal regulations.
PLAN SINGLE FAMILY
Basic + $1,759.00 $4,738.00
$750 CMM $1,414.00 $3,731.00
$3400 CDHP $1,196.00 $3,161.00
$6350 CDHP $ 952.00 $2,515.00
Recommended Action:
Administration recommends the Board approve the following for the 2026-2027 plan year:
- The 9% increase in health insurance premiums.
- Carve out of the pharmacy benefit plan to Crumdale and Express Scripts
- The adjustment of the CDHP 3300 deductible to $3,400 for self-only and family coverage per federal regulations.