Alabama Teachers Receive Raise, But Offset by Insurance Increases

(Photo: AL.com)

(Photo: AL.com)

Alabama teachers have been given a 4% raise from the Alabama legislature after waiting eight years. But a big part of that extra money could be eaten up by higher insurance premiums.

This cost-of-living increase was the first raise teachers had been given since 2008, the year of the Great Recession. Still, the issue remains surrounding higher insurance premiums for the Public Education Employee’s Health Insurance Program (PEEHIP), reports Chris Davis for WHNT-TV.

In April, the PEEHIP board voted to increase premiums significantly and informed educators that the higher payments would begin in October 1, 2016. Superintendent of Madison City Schools Dr. Dee Fowler said she felt sorry for those in the education field, but she added that she understood insurance costs continue to rise.

This week, the Alabama Education Association (AEA), the state’s largest teachers union, filed a lawsuit against the insurance program charging it for a breach of the Open Meetings Act. The association noted that the insurance rate hikes were decided upon in a closed meeting and that the meeting was not announced publicly.

Fowler said she wanted a compromise that would not punish educators in the process.

“I would have liked the chance to say, ‘Here’s an alternative to what you’re planning,’” said Sheila Remington, president of the Alabama Education Association.

Tim Lockette, reporting for The Anniston Star, writes that the PEEHIP board voted for the increase while facing a $141 million budget deficit. AEA leaders explained that the new premiums will take roughly $80 per month from the average education employee’s paycheck.

Remington explained that the PEEHIP led teachers to believe health insurance premiums would be paid by the state this year. The April announcement, therefore, was a major surprise to many school employees.

For employees at the lower end of the salary scale, such as bus drivers, the increased premiums would virtually take away their entire pay raise. Remington added the 4% increase could have been a morale booster. Now, the boost has been compromised.

In past years, the state has contributed more money from the education budget to manage the insurance gap. Yancy said the PEEHIP board requested an increase of just $23 million which was not sufficient to cover the entire shortfall. Had it asked for more, it would have left insufficient funds for a teacher raise. The $23 million was granted by lawmakers.

PEEHIP Board Chairperson Sarah Swindle says the insurance program’s meeting was closed because it was a work session consisting solely of an informational activity for members.

“It was not a business meeting,” Swindle said. “We were told by our legal staff that we could not debate and we could not vote. We could not do a straw vote, either.”

But regardless of the result of the lawsuit, Deputy Director of Retirement Systems of Alabama Don Yancy says the insurance program will probably see an additional $80 million deficit next year due to rising health costs.

AEA’s attorney James Anderson pointed out that the association is not questioning the insurance premium jump but is addressing the process the program used to pass the increase, says the Associated Press.

Caitlyn Cline, reporting for WAKA-TV, said the AEA would like to go back to the starting point and be privy to the insurance program’s meetings and the matters discussed that concern teachers. The AEA members would like to be involved in an open gathering about the premium increase and have the opportunity to discuss ideas that would accommodate all parties.