Ark. Senate Delays Vote on Teacher Ins. Bailout

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A proposed $35 million bailout of the public school teachers health-insurance program ran into resistance in the Arkansas Senate, which recently voted delay any decision on the measure.

Senators voted 18-15 to put off until March 31 the main vote on a mechanism to boost state contributions to teachers’ health insurance premiums. The bill does not authorize actual funding; it would allow the funding to be included in a separate appropriation bill, which would be subject to state spending priorities.

Sen. Bob Johnson, D-Morrilton, led a successful effort to block a vote on the enabling legislation.

The vote on the delay followed a 90-minute question-and-answer session about trouble with the health-insurance program.

In a special hearing on the Senate floor, officials told members that just 60 percent of nearly 40,000 eligible participants take part in the system, mainly because the state pays less than half of the premium—$131 of the $279 monthly payment—for a single teacher and just 20 percent of the premium for family coverage.

They said they feared a rapid exodus of young, healthy workers from the program in the years to come if the state does not increase its contribution to premiums.

Sen. Jimmy Jeffress, D-Crossett, said the program was on a “death spiral” and that “in two years, we won’t have a program” if the state does not pump $35 million into it. That would be the cost of increasing state contributions by $61 per month for each participant.

Jeffress, who is handling the House-approved bill in the Senate for sponsoring Rep. Denny Sumpter, D-West Memphis, said the bailout would be “a shot in the arm to preserve, protect and save the system.”

Jeffress said: “We tried last session to get a handle on it, but with all the issues, it got pushed aside and got lost in the mix.”

However, Johnson contended that the education community made a choice not to pursue higher state contributions to teachers’ insurance premiums and instead successfully sought to maximize teacher pay raises.

He labeled the bailout bill “a way to have your cake and eat it too” and accused education officials of trying to back lawmakers into a corner and make the current legislation a “quasi-litmus test on whether we support teachers or not.”

Sen. Dave Bisbee, R-Rogers, a member of the Senate Education Committee and co-chairman of the Joint Budget Committee, said, “probably, we got outsmarted.”

“But do we have any chance of having a viable teaching force without having an insurance program? I doubt it,” he said, even while acknowledging that some other state program would have to suffer if the state is to afford the $35 million cost.

Rich Nagel, executive director of the Arkansas Education Association, insisted that education officials were not trying to pull a fast one on lawmakers.

The teachers health insurance program started in 1979 and contributions came directly from the state until 1995, when contributions for teachers’ health insurance and retirement began to run through the Revenue Stabilization Act, which sets state spending priorities every two years, Nagel said.

“We knew there were problems, but we did not know this was in a death spiral until this session began,” he said.

Supporters of the enabling legislation said it was too important to put off a vote.

“This does not obligate us,” said Sen. Jim Argue, D-Little Rock, chairman of the Senate Education Committee, “but we need a direction from this chamber. Postponing this for two weeks would seriously hamper our opportunities. It needs and demands our attention for innumerable reasons. We will fail to recruit and retain the teachers we need in the classroom when that subsidy is not there.”

But Johnson said that, if the Senate passed the bill, teachers around the state would not distinguish between the enabling legislation and the actual $35 million appropriation to fund it and “we have created a situation that there is heightened expectation that this will be done.”

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