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The House Committee on Public Education met on April 4, 2019, to take up a number of bills. This report covers only HJR 151 (Huberty), HB 4611 (Huberty), HB 3683 (Dutton), HB 2689 (Dean), and HB 2907 (Krause),

This report is intended to give you an overview and highlight of the discussions on the various topics the committee took up. It is not a verbatim transcript of the hearing but is based upon what was audible or understandable to the observer and the desire to get details out as quickly as possible with few errors or omissions.

 

HJR 151 (Huberty) – Proposing a constitutional amendment allowing increased distributions to the available school fund.

  • Current statute the GLO has the ability to transfer $300m to the ESF.
  • This will create a new funding source for schools. Could mean another $600m per year.

 

Rusty Martin, CIO at GLO – On

  • Huberty – This was a concept talked about early in session by Commissioner Bush. This bill gives the GLO authority if performance is better to direct funds to the ASF.
    • Martin – Correct, $300m per year is under the amount we would otherwise be able to release, so increasing the cap would make sense.
    • Huberty – How much more could be in the system if we had done this?
    • Martin – $350m per year, and as the fund grows that number will increase.

 

Kevin Ellis, self – On

  • Member of the State Board of Education but testifying for self.
  • Support increasing the cap.
  • Additional revenue stream might end up with the SBOE, if that happens the SBOE should have the same authority as the GLO to send those funds directly to the ASF.
  • SBOE and GLO work collaboratively to maximize ASF funding, looking to do this here.

 

Huberty closing comments

  • This is opening the possibility for the fund itself to be increased could be hundreds of millions in the education system.

HJR 151 left pending.

 

HB 4611 (Huberty) – Relating to certain distributions to the available school fund.

  • Enabling legislation for HJR 151.

 

HB 3683 (Dutton) – Relating to authorizing a dropout recovery competency-based educational program provided through a campus or campus program charter or open-enrollment charter school.

  • Almost 20% of 9th graders do not make it to 12th grade and could benefit from an option not currently provided.
  • Due to seat time laws, educators cannot implement innovative programs for engaging drop-out students.
  • Will allow districts to create calendars with flexibility in scheduling.

 

Timothy Mattison, Texas Charter Schools Association – For

  • Bill would help more than 25,000 students in charter drop-out schools.
  • Many drop-outs work, care for young children, relatives and do not have time to attend a traditional school.
  • Bernal – With these drop-out recovery schools do students have to attend every day?
    • Mattison – They can do half-day, but often with young parents they have to leave unexpectedly.
    • Bernal – Why is there a fiscal note? They are already coming to school so why is that there?
    • Huberty – Might be a funding issue, maybe TEA knows the answer.

 

Michelle Crompton-Harvey, Learn for Life Network – For

  • Dutton – Where is your program located?
    • Crompton-Harvey – In California, we also have schools in Flint, Michigan and in Ohio.
    • Dutton – Why did you move into Flint?
    • Crompton-Harvey – There was a need there for our kind of program.

 

Francis Barrones-Johnson, Triumph Public High Schools – For

  • Challenges faced by some students make it impossible to attend five days a week.

 

Scott Carothers, Triumph Public High Schools – For

  • Bill will help students.

 

Mike Meyer, Texas Education Agency – On

  • There is a fiscal note because a drop-out currently is not included in ADA and are not eligible for SFP.
  • Dutton – So we are saving money when they drop out?
    • Meyer – Our expenses are lower, yes.

HB 3683 left pending.

 

HB 2689 (Dean) – Relating to the designation of a cybersecurity coordinator by each school district.

  • A student’s personal information is highly prized on the black market because it does not have a history of credit or bank accounts attached to it.
  • Do not have information on the frequency of attacks on ISDs cybersecurity systems.
  • The bill will require districts to provide reports and information on any attempted attacks and cybersecurity measures taken.
  • Not an unfunded mandate, will not require additional FTEs. There is no fiscal note.
  • Quoted Sun Tzu from The Art of War, “know the enemy”.
  • Ashby – The attacks you alluded to were on the districts, not through TEA, correct?
    • Dean – Yes. This bill is trying to make sure the information is gathered on the district side and sent to the TEA.

 

Jennifer Burgland, Texas Computer Education Association – For

  • This is a very pressing issue, technology directors in school districts are worried about it.
  • Concern with language in the bill saying every “attempt” must be reported, there are attempts being made constantly that would make that impossible.
  • Bill should change “attempt” reporting requirements to requiring the report of any attacks that breached the firewall or other security systems.

 

Dean closing comments

  • Working on a CS that will change language from attempt to any attack that breached security systems and compromised personal information of students or employees.

 

HB 2097 (Krause) – Relating to a pilot program for the provision of health coverage for school district employees in certain school districts.

  • Institute a pilot program for Arlington ISD.
  • TRS active care is struggling to keep up with costs, Arlington pilot program will show if a regional approach is better.
  • Huberty – When did Arlington get into TRS active care?
    • Krause – Years ago, their costs were high, and they wanted a way to have coverage for all employees.
    • Huberty – So they got into TRS to lower costs, and you are arguing that they should now be able to leave because they are taking 100% out of the program. Question is why Arlington, there are other ISDs that would like to do this?
    • Krause – Right now Arlington takes out 109% of what it puts in, so if we do a pilot it should be one that is taking more out than it is putting in. If there was a mass exodus from the program it would implode.
  • VanDeaver – Arlington is taking more money than they are putting in, what makes them think another insurance company would give them a better rate?
    • Krause – Other witnesses can speak to that, they have been looking at this for years and feel they can benefit from a different system.

 

Bowie Hogg, Arlington Board of Trustees – For

  • This will control costs and give a model to the rest of the state for how to control costs.
  • TRS active care is unaffordable. Costs can be up to $27,000 per year out of pocket.
  • Huberty – There are multiple districts out there, why should we choose Arlington?
    • Hogg – Arlington ISD has put together a proposal and will work with vendors. Believe we are the ones who can show the rest of the state this can work.
  • Ashby – If we reduce the risk pool in TRS active care, inherently what will happen is premiums will rise for everyone else left, correct?
    • Hogg – No, Arlington is at 109% of claims cost, so TRS is paying out more in claims than they are collecting in premiums from Arlington. Also, since Arlington is such a small part of the total pool, there will not be much of an effect on TRS rates.
    • Ashby – Does the bill state that Arlington will not be allowed back in once they leave?
    • Hogg – Yes, we specifically put in the bill that we would not be able to come back for 10 years in order to address the adverse selection problem.
    • Ashby – I would be hard pressed to support it, but this is something we should look at and study. We need to take the statewide impact into consideration.
    • Hogg – We agree that a study is great, but part of the study is Arlington being out as a pilot. We are prepared to provide all data back to the state.
  • Huberty – I guarantee that if this got to the floor it would not just be Arlington.
    • Hogg – I think that speaks to how many districts are having problems with TRS active care. The 10% who are not currently in the program are not trying to get into it.

 

Katrina Daniel, Chief Healthcare Officer, TRS – On

  • Huberty – Help me understand what is going on
    • Daniel – Active care program has around 500k people. Some of the larger districts have decided to self-fund and stay out of active care. Large districts, especially in the north, DFW area, have gone into the program due to different costs in different parts of the state. TRS reduces volatility for smaller districts if they funded themselves.
    • Daniel – Healthcare costs have been increasing for everyone, but state contributions for active care have not changed since the program was created.
    • Daniel – Large districts that are not in active care have lower premiums than districts in active care. But that means that the member is paying less in premiums, in reality the districts are kicking in more than the minimum requirement. The employee premium is much less than the overall gross premium.
  • Huberty – Mr. Hogg testified that there is a $27,000 premium, are you aware of something like that in your plans?
    • Daniel – No, we have tiers of plan designs that families can choose from.
    • Huberty – We are hearing that Arlington is getting 109%, is that true?
    • Daniel – Yes, Arlington loss ratio has been 110-120%. TRS has been paying out more in claims to Arlington than they are paying in premiums. But in terms of offered plans I am not sure how they could find a lower premium.
  • Sanford – What is the system loss ratio?
    • Daniel – About 99%, which is right at break-even.

 

Scott Kale, Assistant Superintendent of Human Resources for Arlington ISD – For

  • There is a problem with affordability of TRS active care for employees.
  • Combining premiums, copays, and out-of-pocket costs for certain surgeries is too high.
  • Huberty – Tell me how are you thinking about insurance?
    • Kale – An employee carries health insurance to cover major situations,
    • Huberty – But isn’t the max out-of-pocket expense the max? So, if you are a long time cancer patient with millions in cost it is the some out-of-pocket as a simple surgery?
    • Kale – You would hope that you hit the max in those rare situations like cancer, not in relatively common situations like an Achilles tear.
  • Heard the question earlier that no insurance company would offer lower rates. For a risk pool of a certain size the size of the pool no longer matters, the make-up of the pool is what matters.
  • Requesting through this bill for the opportunity to model it for 12-18 months and come up with best practices.
  • Not asking to get back into TRS.
  • VanDeaver – Get back to the $27,000 cost, how does that cost change if the employee purchases a better plan?
    • Kale – There are some plans that have higher premiums and lower deductibles, but the majority of employees have migrated to those high-deductible plan because the premiums are too high on the other plans.
    • VanDeaver – But that is a personal choice the employee makes, and there might be other plans they can choose.
    • Kale – In both cases where you have high premiums or high out of pocket, it is unaffordable.
    • VanDeaver – This is an area where we can help teachers, I am trying to understand why this and why now.
    • Kale – We have been working on this for about two years and there has been no other initiatives to make a change. We have an opportunity to have a risk-free outcome that only has benefits, I do not see the risk to be candid.
  • Katrina Daniel, TRS – The out of pocket max referred to by Kale is $13,000 if you stay in-network, so it is much lower than the $27,000 number.
    • Kale – When you combine premiums and other costs with the $13,000 out of pocket is adds up to $27,000.
  • Ashby – This is one of the greatest issues facing teachers and increasing healthcare costs affect everyone. Appreciate Krause for bringing this forward, want to be careful about picking winners and losers. Typically, healthcare costs are higher in rural areas, and we need to be fair to everyone across the state.
  • Huberty – My concern with this is the same as Ashby’s. Respect every member to advocate on the behalf of their school district.
    • Kale – If we have success with this then other school districts can follow the model.
    • Huberty – I don’t care about that, you are doing this because you think you can reduce costs, otherwise you wouldn’t do it. There are presumably many other districts who would like to do the same. If you have a bad data set, is there something you are not sharing with us? You will have to provide that data with someone.
    • Kale – There are differences in costs between PPO, skinny network, etc. One-size does not fit all.
    • Huberty – Arlington got into TRS for a reason, no?
    • Kale – Healthcare costs have been rising and we are trying to find a solution.
    • Huberty – TRS doesn’t have a solution?
    • Kale – No, we have seen no evidence that they have a solution.
    • Daniel – We have some wellness initiatives. Healthcare is expensive, when we looked at districts outside of active care the real difference in what the district contributes above the minimum requirements.
    • Huberty – It is frustrating for us that Mrs. Daniel is speaking the truth as she knows it, and you are saying no. And you want out of a system?
    • Kale – Our approach is about addressing efficiencies and cost, there is a big philosophical difference.
  • Ashby – A deep dive into TRS active care is probably a great idea for an interim study, and maybe we want to move forward with some pilot programs. This is bigger than Arlington.
  • Huberty – I do not understand how a district can be pulling more out than they are putting in and they think they can get lower rates outside TRS. Mr. Kale’s view is that he can make suggestions to lower cost, but why would TRS not be doing that?
    • Daniel – TRS does have initiatives to contain costs, and due to the size of the program we can negotiate significant discounts.

 

Name, Arlington ISD – For

  • This is an action to offer change. Needs to happen now, we are trying to motivate that change through a pilot program.
  • Huberty – You can sense my frustration when I have two people saying two completely different things, I think we have a problem with people working together. I want Mrs. Daniel and people from Arlington to talk again. If you are pulling 120% out of the plan, how do you think you can reduce your costs?
    • Witness – We will be able to shop, right now when we go to providers it is theoretical, so they cannot tell us how we would fare in the market even when we provide them with data. We are a small part of the pool, so when we invest in health and wellness there is no return we see on that investment.
    • Huberty – When they retire where do they pull from?
    • Witness – TRS. We would love to stay in and change things, but the pool is so large it is hard to make changes.
  • Ashby – Is TRS active care a PPO or HMO product.
    • Witness – Would have to ask Mr. Kale.
    • Ashby – If we are going to look at stripping away active care there are some issues we will have to vet.

Jacqueline Robinnias, Arlington ISD – For

  • Putting family on middle tier would take away half of a teacher’s paycheck. Too expensive to afford insurance for the family.
  • Take home pay has decreased over the past 7 years due to insurance costs.
  • $1,300 per month for insurance is way too much for a teacher making only $3,500 per month.
  • VanDeaver –We want to help all the teachers in the state but must do it in a measured way because the cost of health care is skyrocketing, and we must be careful in our approach. Realize that doesn’t help you today or next month, but it is necessary.
    • Robinnias – Understand the frustrations, but we need to do this now because it is making such a huge dent in paychecks. Arlington would be a good place to start.

 

Krause closing comments

  • Brought this bill up to help Mr. Robinnias and other teachers like her.
  • We are not picking winners and losers, we are only picking winners and winners.
  • This will show if the regional approach works without doing anything to crazy.

HB 2097 left pending.