Teachers health trust tells providers it lacks money for past claims

The health insurance trust that covers thousands of Clark County teachers and their dependents does not have the money to cover claims made prior to July, according to a recent letter to medical providers.

“To be fully transparent, these claims are not currently funded,” the letter reads. “We are working tirelessly and evaluating any available option to resolve this situation.”

THT Health, formerly Teachers Health Trust, is a teacher-run nonprofit providing coverage to 18,000 educators and their families, totaling about 34,000 people. Described as a “self-funded health trust,” the plan debuted in 1983 and is overseen by the teachers union, Clark County Education Association. According to the union’s most recent collective bargaining agreement with the Clark County School District, a large portion of the trust’s funding comes from contributions made by the district on a weighted scale.

The letter, signed by THT Health’s CEO Tom Zumtobel, offers the latest glimpse into the bleak financial picture of a health trust that again has been circling the drain for months, and, according to a class-action lawsuit filed in 2017, is known for its “problems with non-payment.” Two years before the lawsuit, the trust was on the verge of failure before it got a roughly $10 million bailout.

“For the past year, the Teachers Health Trust has not met the expectations of our providers and our members, and for this, we wholeheartedly apologize,” the letter states. “Both you and our members deserve a better partner in health, and that is our sole mission for the upcoming year.”

To keep the trust afloat, according to the letter, THT Health has settled a portion of its debt with its “largest provider at a significant discount.” In addition, THT Health announced several changes last month as part of a deal with the school district and the teachers union.

Among those changes were a new administrator and two new insurance plans for Clark County teachers. The deal also included a $35 million advance from the school district in exchange for “more transparency” from the trust.

According to the letter sent this week, the millions in financial assistance from the district “was a prepayment of the September through November 2021 premium.”

The funds will not help reconcile past claims.

Records previously obtained by the Las Vegas Review-Journal showed that the nonprofit trust was $43 million in debt as of February. It is not known if that number has changed since then.

THT Health did not respond to a request for comment regarding the letter, which was sent to its providers as early as Tuesday.

A similar letter has not been sent to district employees. John Vellardita, executive director of the teachers union, said Thursday it wasn’t necessary because neither the union nor the health trust wants the backlogged claims to fall on the teachers.

“We’re going to make damn sure that people aren’t stuck with the bill,” he said.

Vellardita also noted that teachers have been aware for months of their health insurance provider’s financial situation.

“This is not a debt that happened overnight,” Vellardita said, later adding that he remains hopeful the trust will reconcile its current financial strain. “I am optimistic, but it all depends on whether or not there is a fair investment in these educators’ health plans, and that’s what we’re in discussions about with the school district.”

A spokesman for the school district deferred any questions to the union and THT Health.

Concerns of trouble ahead for the trust were first raised in December 2019 and again in March 2020, records show, with reports that medical expenses were coming in at 90 percent or more of income and outpacing an increased employer contribution from the district.

Around this time, Laura Penrod, an English teacher at Southwest Career and Technical Academy, said she was dropped as a patient by her dental office over non-payment by THT Health.

“It was the first dentist I ever liked, and I had to stop seeing him due to THT negligence in paying their bills on time,” she told the Review-Journal on Thursday.

More than a year has gone by since she last paid a visit to a dentist.

“Dental work is intimate,” Penrod said, “and I don’t trust just anyone.”

Contact Rio Lacanlale at rlacanlale@reviewjournal.com or 702-383-0381. Follow @riolacanlale on Twitter.