Sacramento City Unified agrees to restore Health Net for retirees 65 and older

The Sacramento City Unified School District, which this year agreed to restore Health Net for teachers and early retirees, will extend the health insurer option to retirees 65 and older on June 1.

The decision announced this week caps months of conflict over the district’s unilateral decision last year to eliminate Health Net as an insurer for about 2,100 individuals, mainly teachers and retirees.

The district and the Sacramento City Teachers Association agreed in February to restore Health Net for about 1,100 of those, including early retirees. That decision has now been expanded, allowing about 1,000 retirees who are 65 and older to return to Health Net.

“We are very encouraged that this is getting resolved,” said SCTA President Nikki Milevsky. “We wish that six months hadn’t been wasted on violating our contract. But it’s a very good sign that the board and superintendent have chosen to honor the contract. It’s a positive direction.”

District spokesman Gabe Ross said a collaborative process led to the memorandum of understanding signed late last week.

“We’ve been working closely with SCTA to make this process easier with a continued focus on providing the level of benefits that our retired employees deserve,” Ross said.

The district dropped Health Net last year in a bid to streamline insurance providers and save up to $8 million.

Last fall, SCTA filed an unfair labor practice claim with the state Public Employment Relations Board and later filed to force mediation.

Against that backdrop, the district worked with the teachers’ group to restore Health Net, which was spelled out in the SCTA contract but was eliminated without negotiations.

The latest announcement gives 65-and-older retirees the option to return to the former insurer or to remain with Kaiser or other Medigap plans chosen in open enrollment.

Milevsky said the SCTA is encouraging its members to return to Health Net, noting that the association views those benefits as superior to the “random” choices the district’s consultants recommended during open enrollment.

To ease the shift back to Health Net, the insurer lowered its costs to the district by 1.5 percent compared with 2014. Even so, the district has estimated that Health Net restoration means the district’s savings likely will be less than half of initial estimates.

Call The Bee’s Loretta Kalb, (916) 321-1073. Follow her on Twitter @LorettaSacBee.