Healthcare is Choking Our Kids Future: Teacher Strikes Highlight The Real Adversary -- Healthcare Profiteering

Teacher strikes often spotlight health benefits disputes. Yet, both teacher unions and school boards are missing the larger threat: a healthcare system run amok that undermines educational quality, leading to increased class sizes and reduced programs, harming students and our future. A solution exists, as demonstrated by Allegheny County's effective approach to managing healthcare costs (PDF) and numerous other school districts (see video case study below).

Healthcare’s Hyperinflation is Breaking US Schools

In a?TED talk , Bill Gates explored the broad effects of state budgeting on school funding, featuring insightful slides from his presentation. While focusing on data from California, Gates highlighted a widespread issue: only $3 million allocated for retiree benefits against a promised $62 billion, a discrepancy surpassing even that of automobile manufacturers.

The situation is dire now and will deteriorate further without sustainable solutions for education funding. Addressing this issue with temporary fixes is like applying a Band-Aid to an increasingly severe wound.

You might have observed the recurring cycle of education funding crises. For example, in Massachusetts, despite legislation to increase teacher salaries, educators didn't see any additional take home pay. All the extra funds intended for their pay were consumed by rising healthcare premiums.

Gates emphasized that the situation will deteriorate, making our aspirations for enhancing schools unattainable.

The GAO's projections extend to 2060, show how healthcare will steadily strangle other budgets . However, the future isn't needed to observe this effect; the slide below demonstrates how healthcare spending has already curtailed other state-level expenditures.

Examining the areas experiencing cuts reveals they?drive health outcomes more than clinical care . Echoing Winston Churchill, "Healthy citizens are the greatest asset any country can have." Our nation now faces a stagnant lifespan for the first time in history, with quality of life deteriorating significantly. A decade ago, mobility scooters were a rare sight, yet today, they are increasingly common.

A Local Case Study

Kevin O’Sullivan, a principal at a national accounting firm and former school board member near Philadelphia, analyzed his school's budget, highlighting the impact on property taxes, which have doubled in 15 years. All the increase aimed to support education but instead fed into healthcare waste , as detailed in his editorial letter. Despite these tax hikes, there's been no significant improvement in lifespans, and school programs have suffered cuts. Additionally, due to a 2% cap on property tax increases, healthcare costs are also undermining other municipal needs like infrastructure.

Let’s extrapolate the expense drivers in the budget. If salaries go up 2 percent per year, at $750,000, and healthcare goes up 15 percent each year, call it $1.5 million we are looking at an increase of $2.25 million per year, every year.

It has taken up $4 million more in expense on our budget. This $4 million obligation now threatens even the continuation of existing programs for our students, and hampers the ability to invest in new programs. We are paying more taxes and getting fewer services. This is not sustainable.

Teacher Unions Must Step Around to the Other Side of the Table

"The definition of insanity is doing the same thing over and over again and expecting different results." - Albert Einstein

Hyperinflation in healthcare costs is undermining education and depleting retirement savings. The traditional confrontations between school boards and teacher unions are outdated, as both seek quality education and fair teacher compensation. However, healthcare profiteering, price-gouging, fraud and administrative bloat pose the greatest threat to funding and salaries. With significant buying power, school districts, paying around $20,000 (or more) per staff member for health benefits, are beginning to collaborate with other community employers to amplify their influence.

Healthcare solutions exist, proven by models like Health Rosetta , which shows that a comprehensive approach can yield significant savings and improved outcomes. Examples include organizations that have successfully implemented these solutions, resulting in lower healthcare costs, reduced employee turnover, and enhanced educational support through saved funds. This collective approach not only benefits the organizations involved but also contributes positively to community welfare.

The takeaway is that everyday Americans, without being healthcare "experts," have found a solution. Here are the actions forward-thinking union leaders and school boards will adopt:

1. Host a dedicated session between union leaders and management to evaluate the historical and future impacts of healthcare costs, focusing on their effects on both educators and students to sharpen focus.
2. Establish mutual objectives independent of labor negotiations, utilizing proven health plan strategies that can be implemented at any time, not just during open enrollment periods or collective bargaining (the school district example in the video happened outside of collective bargaining yet has now banked/reinvested $10 million in savings -- a large sum for a small school district).
3. Highlight case studies demonstrating effective actions and results, comparing them to instances like Detroit's bankruptcy driven by healthcare costs, to underscore the importance of change for preventing stagnant wages due to rising healthcare expenses.
4. Leverage and implement tested models that make use of the substantial purchasing power most school districts possess. A school district with 1000 staff likely has a buying power of between $15 and $25 million -- a very substantial amount in almost any town.
5. Keep union members and the local community informed about progress to sustain engagement and momentum. [See this chapter on change management (PDF) outlining key steps for successful transformation.]

If union and school board leaders don't act, PTAs should step in to address healthcare costs. They can organize meetings to educate and motivate action from both unions and boards. High healthcare costs not only affect families with children but also stifle community economic growth. Over my lifetime, healthcare costs have skyrocketed by 274 times compared to an 8-fold increase in other consumer goods, without improved outcomes. This issue is too crucial to leave to so-called experts who've failed us for decades.

Those benefiting from the current system will resist change, while politicians may use healthcare as a divisive issue. However, proactive community members, regardless of political affiliation, must look beyond these tactics. The real challenge comes from those intent on maintaining the status quo, which compromises our future.

At the end of the day, teachers, unions and administrators have a choice between what those experience in the video below (the experience for teachers, firefighters, police officers and other school district, city and county staff) and more strikes that avoid getting at the underlying cause of school funding challenges.