School officials plan Medicare education, audit and billing changes to rein in health-care costs

Lynchburg City Schools finance and facilities members heard a presentation on Tuesday from Heath Thomas of Mark 3 about steps to curb rising health-insurance costs.

Thomas told the committee the district has contracted quotes for a dependent-eligibility audit this summer to identify employees with outside coverage and reduce improper premium expense. "The first thing that we are looking at is we've got no pricing for a dependent eligibility audit," he said, adding the audit would inform whether a policy change is warranted.

The consultant reviewed the district's move to the HealthKeepers network effective Jan. 1, 2026, and said early signs show minimal complaints about access to physicians. He reiterated an earlier estimate of roughly $500,000 in potential savings from the network change. Thomas also said enrollment in the district's plan has fallen about 10% in the last 24 months, from nearly 1,400 employees in January 2024 to roughly 1,285 in February 2026, which has reduced premium revenue.

On Medicare, Thomas said federal Centers for Medicare & Medicaid Services rules require employers to offer the same group plan to active employees over 65 and bar financial incentives to encourage them to leave the plan. To help employees weigh options, the district will offer a voluntary, federally filed Medicare-education session during the fall open-enrollment period. "This would be a class where people could come in and optionally learn about Medicare and the benefits of it," Thomas said, adding there would be no sales and that one-on-one follow-up would be available for employees with individual prescription or IRMAA concerns.

Thomas said Anthem agreed to a flat monthly billing arrangement for 2027 to reduce volatility in self-funded premiums, and staff will receive utilization data and a fuller Anthem presentation before summer budget planning. He also said the district's health plan is scheduled to go out to bid in 2027 for an effective date of Jan. 1, 2028.

Committee members asked questions about timing, out-of-pocket prescription exposure under Medicare, and how Part B premiums compare with the district's employee-only contribution. Staff committed to include Medicare-education materials and training opportunities during the fall open-enrollment process and to arrange Anthem and HealthKeepers utilization briefings for the committee.

The committee did not take a formal vote on plan design changes at the meeting; the consultant's recommendations will feed into the summer renewal and the 2027 budgeting process.