The Humboldt Unified School District governing board voted 2-3 on March 27 against switching the district's employee health insurance from its current pooled provider to an alternate pooled plan presented as ASBATE/Asbate.

Board members said the decision followed extensive staff input, analysis by the district finance office and hours of questions about provider networks, deductibles and whether short-term district savings would shift cost burdens to employees.

Why it matters: The district's annual insurance purchase is its single largest recurring procurement. Finance staff said the Asbate quotes would have reduced the district's estimated 2026 cost by roughly $636,000 compared with the renewal presented by the district's current pooled provider, Kairos, but board members and employees raised concerns that some staff could face higher out-of-pocket costs under certain plan choices.

Finance director Mike Tannehill told the board the district currently has about 631 employees eligible for benefits and roughly 500 participants in district plans; he said 254 employees are on the district's most popular copay plan, and that the quoted Asbate options would lower the district's projected premium expense while, in some scenarios, raising deductibles or copays for employees. Tannehill said the district's estimate of the first-year savings if the board adopted Asbate was roughly $636,000 and that compounded differences in future years could be larger depending on pool rate movement.

Employees and union representatives had several opportunities to ask questions prior to the vote. The district circulated a short staff survey; Patricia Walker and district HR staff collected more than 200 responses in the two days before the meeting with 87.1% of respondents indicating preference for the Asbate option, according to Tannehill's presentation. Board members said the survey response was useful but not determinative.

Board members probing access and affordability raised these points:
- Network access: Some members said the provider lists the district received were hard to reconcile and noted that provider participation shifts yearly; the district encouraged employees to check directly with their providers. Tannehill said Asbate uses Aetna's network and Kairos uses UnitedHealthcare on the back end, and that apparent provider counts in the materials included duplicate listings and varying formats.
- Employee cost risk: Several board members noted that, depending on which plan an employee chooses, total out-of-pocket exposure could rise by several hundred to over a thousand dollars in some hypothetical scenarios. Board members asked whether that potential exposure would offset any district-wide salary increase the board could fund with savings; Tannehill said the cited savings would cover roughly half the cost of a 3% across-the-board pay increase, as an approximate ballpark.
- Timeline constraints: Board members asked whether more time for employee outreach and clearer provider lists could be obtained; Tannehill said renewal timelines and pool renewals limit the district's ability to get later extensions and that written rates were not always firm until March.

The motion to adopt Asbate was made and seconded; the vote failed 2-3. The board did not record individual roll-call votes in the public record beyond the tally presented at the meeting.

Board President Wolcott and other board members said they recognized the financial pressure to contain district costs but also felt a duty to avoid shifting unexpected costs onto lower-paid staff. Tannehill thanked the board and staff for their review and said the district will continue work to price coverage and to provide clearer provider information for employees during open enrollment.

Next steps: With the motion failed, the district will remain with its current pooled arrangements for the 2025-26 plan year while finance and HR continue outreach and planning for future renewals. Board members asked staff to continue to share provider lists and clearer, plan-level total-cost scenarios with employees and to quantify how any future savings could translate into salary dollars versus benefits.

Clarifying details: 631 employees eligible for district-sponsored coverage (approximate), roughly 500 participating at time of presentation; 254 employees on the district's most popular copay plan; a cited first-year savings estimate of about $636,000 comparing the two pooled-provider quotes; estimated employee total out-of-pocket differences varied by plan and case and were described during the meeting as between tens to several hundred dollars for many scenarios and up to roughly $1,980 in some high-use scenarios (as presented during discussion).