School board raises deductibles, specialist copays, and employee premium share in health plan renewal

On May 18 the School District of Rhinelander Board of Education made several changes to the district’s employee health insurance plan for the 2026-27 school year. The series of votes followed a lengthy discussion about how to manage projected cost increases while protecting both employees and the district’s budget. District administration proposed four changes to the self-insured health plan, and the board approved all but one. The plan covers roughly $8 million in annual costs — with the district shouldering approximately $7.6 million of that total.
The Situation
District superintendent Eric Burke and benefits consultant Ken Zastrow presented data showing the plan ran at a 108% loss ratio in the 2024-25 plan year, leaving it underfunded by roughly $600,000. The current 2025-26 plan year has also run over budget in recent months, though it remained in a slim surplus position through March, they reported.
With medical costs trending up roughly 8% annually and prescription drug costs rising at 11.5%, actuarial modeling projected a 21% increase — or about $1.667 million — would be needed to maintain the plan at its current design, the board members were told. The district had budgeted for a $1 million increase.
What Was Approved

The board voted to:
Increase the deductible on Plan One from $1,000 for a single individual/$2,000 for a family to $1,500 single/$3,000 family
Increase the specialist office copay from $25 to $60 in both plans
Raise the full-time employee premium cost share from 4.53% to 8% for both plans
The 8% premium share is projected to bring the district’s increased health insurance spending to approximately $1 million — in line with what was budgeted. At that rate, a single employee on Plan Two would see roughly a $54-$56 increase in their monthly premium contribution.
What Was Rejected
The administration’s proposal to increase the emergency room co-pay from $150 to $300 within both plans generated considerable discussion.
Board member Mike Roberts made an impassioned case against raising the ER co-pay, arguing the existing $150 co-pay was already a “deterrent” and that families facing a medical emergency shouldn’t be penalized further.
“I hate to put a family in a situation where it’s a Sunday and they have a child with an earache or something, and they’re weighing whether they’re going to spend an extra $150 to take them to the emergency room to get proper medication earlier or wait till Monday to try to get an office visit,” Roberts said. “To me that just seems excessive.”
Board member Ron Lueneburg, a retired police captain, argued in favor of all of the proposed changes, noting that school district employees enjoy a significantly richer benefits package than many of their peers in the area.
“I know the city and county do not have a plan like this,” he said, adding that he would love to have access to a plan with such favorable terms. He urged his fellow board members to be mindful of the considerable work the administration had put into developing its recommendations and to consider the fiscal responsibility owed to taxpayers.
Board member Duane Frey, a retired school administrator, echoed that sentiment, warning the board against incremental thinking at a moment of serious financial pressure. “We can nickel and dime this thing,” he said, “but this isn’t the time. We got some big money here.”
Ultimately, the panel chose to reject the administration’s proposal and keep the ER co-pay at $150. A compromise motion to raise it to $200 failed with only Frey and Lueneburg voting in favor.
Roberts also pushed back on the proposed specialist copay increase, noting that patients rarely seek out specialists on their own initiative.
“Families don’t decide if they want to see a specialist — they’re told if they want to see a specialist,” he said. “You don’t want a deterrent from taking your child to see a specialist.”
Looking Ahead
According to resolution explaining the administration’s proposal, the SDR plan is more generous than the plans offered to employees in comparable districts. “Benchmark data show that Rhinelander’s current health plan is significantly richer than most comparable school districts,” the resolution reads. “Our plan has an actuarial value of 97% compared to the 85% average among school districts, This has contributed significantly to our employee monthly premiums and out-of-pocket costs being substantially lower than those of other district plans. While this provides strong benefits for employees, it also means the district is covering a larger share of our overall health care costs than most peer districts.”
Even at the newly approved premium share, the district’s employee contribution rates would be slightly below the average for Wisconsin public school districts. The current deductible, even after the increase, remains below the statewide school district average of $3,000 single/$6,000 family.
With rising health care costs and significant usage of the district’s health insurance benefits, board members acknowledged the challenge is unlikely to go away.
“I think there’s a real possibility we’re going to be here at the same time next year, having the same discussion,” Lueneburg said.
The concern is compounded by uncertainty at the state level. The district’s finance director, Bob Thom, noted that a state funding bill that failed to pass last week would have provided the district approximately $227,000 in additional special education aid this year and potentially $500,000 more next year. Without it, the district may face a shortfall of several hundred thousand dollars in special ed funding — making next year’s budget picture even more difficult.
While local voters have been supportive of the district at the ballot box, approving operational referenda to exceed the levy limit in February 2016, November 2018, November 2022 and April 2025 (as well as a $26 million capital project referendum in 2024 to fund upgrades to the high school and middle school), Frey implored his colleagues to make decisions now so that the district can avoid putting another referendum before the voters in the near future.
“Over all the years we’ve been on the board, we’ve been, I think, as generous as we possibly can (with employee benefits), I really do,” he said. “We’re in a tough spot, and we have an obligation to our taxpayers not to exceed our budget if we can. We can’t go to another referendum in another year.”