Lawrence school board weighs health plan changes amid rising costs

Higher employee premiums, reduced coverage or a tighter school budget are the choices Lawrence school board members were weighing as medical costs for next school year climbed sharply. The district’s Fringe Benefits Committee recommended changes to the medical, dental and vision plans for 2026-2027 after fully insured medical premiums were projected to rise 32%.

The biggest change under review is a switch from a fully insured medical plan to a self-funded model with stop loss. Under that approach, the district would take on more of the direct risk for employees’ and dependents’ medical claims instead of paying a fixed premium to an insurer. A third-party administrator can still handle enrollment, claims processing and provider networks, but the financial exposure shifts to the employer. For USD 497, the question is whether to absorb more of the increase itself or ask employees to shoulder the difference through higher out-of-pocket costs.

That tradeoff matters far beyond the insurance line in the budget. School districts rely on health benefits to recruit and keep teachers, paraprofessionals and support staff, and administrators have said the district’s human resources work centers on recruiting, hiring, supporting and retaining qualified employees. If coverage gets leaner or more expensive, the pressure could show up in morale, hiring and retention at a time when classrooms and operations are already competing for limited dollars.

The Lawrence Board of Education was scheduled to take up the issue Monday at 6 p.m. at the Educational Support Center, 110 McDonald Drive. USD 497 says its regular board meetings are held on the second and fourth Mondays of each month, and the Certified Negotiations Fringe Benefits Committee meets at 4:45 p.m. in the ESC Collaboration Room unless otherwise announced.

The timing is especially important because the district has already moved on several labor issues this school year. On May 8, USD 497 and its unions reached tentative agreements for teachers and support staff. Earlier in the 2025-26 cycle, the board approved an $800 base salary increase for teachers and a 3.162% increase to the certified salary pool. It also approved a $1 hourly raise for education support professionals, lifting the lowest-paid ESP minimum hourly wage from $14.02 to $15.46. Any added health-care cost now would change the value of those wage gains for employees.

Douglas County has already taken a similar path. County commissioners approved a self-funded employee health care plan with UnitedHealthcare administrative services, effective June 1, after saying 2025 health care costs had exceeded budget by $300,000 and were still rising. For Lawrence schools, the same underlying pressure is now landing in a more sensitive place: staffing, compensation and what remains for classrooms after benefits are paid.