By Steve Gunn
EAGgnews.org

PORTLAND, Maine – Health insurance has long been a profitable racket for the Maine Education Association, the state’s largest teachers union.

That’s because the union and Anthem Blue Cross/Blue Shield teamed up for years to monopolize the state’s public school health insurance industry.

MORE NEWS: From Classroom to Consulate Chef: Culinary Student Lands Dream Job at U.S. Embassy in Paris

But an appeals court judge recently upheld a new law forcing a union-owned insurance carrier to turn over health insurance claims history for individual districts, according to a report from Fosters.com. That will allow school districts to seek competitive bids from multiple insurance companies, escape the union monopoly and save millions of dollars in the process.

Here’s how the insurance racket has traditionally worked in Maine.

MEA Benefits Trust, a union-owned insurance carrier, purchased health insurance coverage from Anthem Blue Cross/Blue Shield, then repackaged and sold the coverage for an inflated price to most school districts throughout Maine, according to various officials.

Local union officials would push Benefits Trust insurance on local school boards during collective bargaining sessions. And Benefits Trust would block local school boards from seeking competitive bids from other insurance companies by refusing to turn over health insurance claim data for individual districts.

Asking an insurance company to bid for a school’s health insurance policy without knowing the district’s claims history would be like asking a contractor to bid on the demolition of a building without being told the size of the structure. It simply can’t be done.

By refusing to share claims history, Benefits Trust was perfectly aware that it was chasing away competition, and it liked it that way.

MORE NEWS: Know These Before Moving From Cyprus To The UK

And why not? Benefits Trust was able to build assets in the range of $80 million through insurance premiums paid by school districts and fees and rebates paid by Anthem Blue Cross/Blue Shield. The teachers union received an annual cut of MEA Benefits Trust profits, including nearly $1 million in 2010.

In short, the union and its pet insurance company raked in a lot of taxpayer money while students were shortchanged. When the state passed the law requiring insurers to turn over claims histories, the union filed a lawsuit to challenge it.

But the schools have prevailed in court and the union is the loser. Now public schools will have more opportunities to seek bids for insurance, save millions of dollars per year and spend the savings on student needs.

For once the unions lost and the kids won. Hooray for the appeals court judge in Maine.