Last week a “health holiday” was announced that eases the school district budget for FY 18. A lot of people were confused about what a health holiday actually is. Here’s my brief explanation.
The City of Newton is self-insured. The premiums that employees pay as well as the employer contribution toward health are held in a reserve fund to pay claims. When that reserve fund reaches a certain level the city takes a break from paying into the fund and a “health holiday” occurs.
So this isn’t new money or found money. The funds in question are money that the school department has earmarked for paying their contribution to employee health care and for NPS that’s $600,000+ per week. A two week health holiday means that $1.2 million that was set aside for health insurance premiums can now be spent on something else.