A loophole in our state's insurance laws allow public schools and municipalities to participate in self-insurance pools. These pools collect millions in tax dollars, yet maintain immunity from regulation and oversight by the South Dakota Division of Insurance.
In March of 2017, my wife was badly injured by a student. She nearly died. Unbelievably, her worker's compensation claim is still being argued today and involves more than a dozen attorneys. Not unlike other districts in our state, our local choice for worker's compensation insurance is the Associated School Boards of South Dakota Protective Trust.
Unregulated insurance pools create great risk for taxpayers and promote a non-competitive marketplace for the private sector. Premiums for the ASB Trust are paid by districts using tax dollars. Large losses can be assessed to members, and excessive denials are dumped on the state's hard-working Department of Labor for resolution. A quick survey of law offices throughout the state reveals the unregulated pools are predictably denying too many claims.
School districts are allowing the abuse of teachers through this exploitation by the ASB Trust without support from the SDEA. Unbeknown to many, the SDEA does not represent members injured at work, regardless of the millions collected in premiums.
South Dakota needs to do much better to ensure our education funding is serving the children to which it is designated. This year's legislature must investigate all bureaucratic third parties embedded within our state's education dollars. Oversight and regulation of the state's insurance pools should be consistent with the private sector.
What may be considered illegal rebating by private insurers is openly marketed as "extending coverage to board members at no additional cost." Legislative scrutiny of free benefits extended to administration and boards by pools (illegal in the private sector) is a logical place to start.
Watertown, Jan. 4