How rising healthcare costs are impacting schools on Long Island and across the country
High school students in the Jericho district, where about $21 million has been allocated for healthcare costs in the 2025-26 school year. Credit: Rick Kopstein
Rising healthcare costs are straining school district budgets and forcing educators to make difficult choices on Long Island and across the country.
In a nationwide survey, 98% of school district leaders said increased healthcare expenses are having a negative impact on spending plans, according to a report by AASA, also known as the School Superintendents Association, along with the Association of School Business Officials International.
Two out of three districts reported spending more than 10% of their budgets on employee insurance benefits during the last school year, according to the survey.
The increasing costs of prescription drugs, including specialty medications such as GLP-1 drugs, and more claims for expensive treatments were among the main drivers of higher premiums, the report found.
Local school leaders said in interviews Tuesday that they are feeling the pinch of high healthcare costs. Premiums for the state’s New York State Health Insurance Program, which covers many school employees, have risen steadily in recent years, they said.
School districts have seen annual increases of 10% or more in health insurance premium costs, said Bob Vecchio, executive director of the Nassau-Suffolk School Boards Association. Districts that cover their own employees’ healthcare costs instead of participating in NYSHIP also have experienced substantial cost increases, he said.
“It's a major concern from a budgetary standpoint,” he said.
In Jericho, healthcare costs “are going up regularly, and they are sometimes outpacing what our annual tax increases are, so that can be problematic," said Superintendent Robert Kravitz.
School districts in New York State are subject to a tax cap, which limits their annual property tax increases. Jericho's tax levy for the upcoming school year is about $121 million, with roughly $21 million allocated for healthcare costs, according to the district.
Jericho has not had to cut programs or staff, but Kravitz said officials need to find ways to keep costs under control, such as by routing buses in ways that are cost-efficient.
“Many people assume that schools have unlimited budgets and they can add clubs, they can add activities, they can add programs,” he said.
'Huge budget item'
More than half of districts in the national survey reported tapping reserve, or "rainy day" funds to cover premium increases, even though such funds are not intended to subsidize recurring costs such as health care, the report found.
Nearly half of districts cut costs by modifying employee benefits packages, the report found. Other strategies included delaying new hires, cutting back or postponing spending on instructional materials and technology, and offering less generous health plans for individuals and families.
The Kings Park district, like many others on Long Island, covers 80% of the cost of premiums for most employees, and the price of coverage for each family has risen to about $44,000 a year, said Superintendent Timothy Eagen.
That will add up to $18 million — or about 15% — out of next year’s $113 million spending plan, Eagen said.
“It's a huge budget item,” he said.
The district eliminated 4.7 staffing positions for the coming year for a variety of reasons, including rising costs and declining enrollment, Eagen said.
“At the end of the day, you have to be able to present your community with a balanced budget,” he said. “There's always fun and innovative things that come to your attention during the course of the year, and unfortunately, sometimes you just have to take a pass on something because you know you're not going to be able to afford it.”
Maura McDermott covers education. Since joining Newsday in 2012, she also has worked on the investigations team and covered real estate and the business of health care.
