Why can’t OEBB subsidize the rate the way OSBA and OEA ChoiceTrust did?
OEBB has no reserve of funds to subsidize rates. The statute that governs OEBB permits an administrative fee to be paid to cover operations costs. Those administrative fees covered operating costs in the first year of OEBB and allowed the Board to pay off the General Funds loan of $4.99 million. The OEA and OSBA Trusts build up trust funds that could be used to subsidize premiums over a number of years. The Board did; however, reduce the OEBB administrative fee from 1.6 percent to 0.95 percent to help reduce the costs of the overall increases.
