Prices at four of the six state universities are up for athletes' secondary insurance
PIERRE — South Dakota's state universities will pay about $207,000 more for secondary insurance coverage of their student athletes in the coming year, rather than about $741,000 more.
The South Dakota Board of Regents voted Thursday to keep the Dissinger Reed firm and accept its price of $825,612.
The six universities paid Dissinger Reed a total $618,460 in premiums in 2013 for their athlete policies.
The initial quote from Dissinger Reed for 2014 was $1,359,299.
The regents asked their staff to see if a better price could be found.
Dissinger Reed came up with a new claims administrator and a new policy carrier that allowed for the $825,612 price.
Two of the campuses, University of South Dakota and South Dakota School of Mines and Technology, will pay less under the new plan. The other four will pay more.
The staff found another company, Cypress Risk Management, that was willing to provide a quote of $781,200 but for only five of the universities, excluding the University of South Dakota.
The staff's recommendation was that the regents should stick with Dissinger Reed.
"The good news is they came down from the original. The really bad news is they went up from last year," regent Terry Baloun of Highmore said.
Athletic directors sent notices to all of the coaches once the agreement was reached, Northern State University president Jim Smith said.
Smith said secondary insurance in a group format is cheaper than athletes adding a rider to their personal insurance.
Less than 50 athletes opted out of the coverage last year throughout the universities system, according to Kayla Bastian, the regents assistant director of human resources.
Bastian said three other insurers were approached about price quotes for the universities and one wouldn't even bid because South Dakota's claims history was so volatile.
"It just didn't seem right there's no break for a deductible," regent Randy Morris, of Spearfish, said.
Regent executive director Jack Warner said a no-deductible policy isn't sustainable. He said premiums would turn "very high" as the claims history catches up.
South Dakota needs a plan to manage deductibles, Warner said.
Morris asked whether the regents could impose a deductible. "I'm worried. If there's no deductible, everybody goes to the doctor," Morris said.
Sheila Gestring, vice president for finance at USD, said USD's athletic programs operate under a $3,000 deductible and pre-approval of medical visits is required.
She said most athletes have private primary insurance that covers up to the $3,000.
Stacy Krusemark said Dakota State University is charging $100 per athlete this fall and probably will increase the amount in 2015. He is DSU's vice president of business and administrative services.
USD's cost for the secondary insurance will decrease under the new coverage to $82,612 from $90,950.
South Dakota School of Mines and Technology also decreases, from $67,410 to $53,000. Mines originally faced an increase to $85,272.
The other four universities face hefty amounts in the 2014 premiums, even with Dissinger Reed coming up with a better deal for each on the second try.
South Dakota State University paid $212,930 and goes to $350,000. SDSU originally faced $588,892 this year.
Northern State jumps from $99,510 to $150,000. NSU originally faced $292,118.
Black Hills State climbs from $93,000 to $115,000. BHSU originally faced $186,652.
Dakota State rises from $54,570 to $75,000. DSU originally faced $123,753.