Rising healthcare costs are ‘crippling’ Georgia school systems

The cost of healthcare for Georgia school systems has risen “astronomically” over the past 16 years, experts say — forcing educators to make tough choices about the services they’re able to provide for students.

Fulton County, which approved a budget with a reported $57 million shortfall this year, budgeted $206 million for healthcare in its general fund next year. The DeKalb County School District plans to spend a total of $284 million for employee healthcare coverage.

In Baldwin County, a small school system in Milledgeville, employee benefits make up about one-third of its $56 million annual budget. Of $16.5 million in benefits, the school system must cover almost $10 million with local funding, said Superintendent Kristina Brooks.

“It’s significant,” she said. “The rising healthcare costs are crippling.”

The issue started in 2010, when the Great Recession led state lawmakers to cut funding for noncertified school employees, like bus drivers, cafeteria workers and secretaries. Suddenly, school systems had to pay the full employer contribution for those workers without any state funding.

In 2010, that was about $2,000 per employee per year. But it’s steadily risen since then, and now districts must pay more than $23,000 per employee per year, according to data collected by the Georgia Budget and Policy Institute. Between 2022 and 2026 alone, the cost of health insurance doubled.

“It has become astronomical and it has really become one of the biggest burdens that school districts have been dealing with,” said Ashley Young, at the Georgia Budget and Policy Institute.

Chief financial officers for Georgia school systems have cited rising healthcare costs as one of their biggest budget stressors in recent years.

For Cook in Baldwin County, the year-over-year increases meant having to dip into its emergency fund every year, and outsourcing work to contractors rather than in-house hires. The district uses third-party vendors for all of its custodians and cafeteria workers and many of its paraprofessionals. It’s a common approach in Georgia, Young said.

But the issue is not unique to the Peach State: Hundreds of school system leaders across the country said increasing healthcare costs are having a measurable impact on their budgets, according to a survey of more than 700 leaders by the AASA (the School Superintendents Association) and the Association of School Business Officials International. And almost all of them said that in the 2025-26 school year, healthcare costs made up 30% or more of their budgets.

Sasha Pudelski, the director of advocacy for the AASA, said she was surprised to see just how universal the pressure is for districts of all sizes. The superintendents cited rising prescription drug costs as one of the biggest drivers of the increase, and said they’ve resorted to things like delaying hiring, dipping into their reserves and pausing spending on curriculum and technology.

“This is having a profound impact,” she said, “and forcing superintendents to make tradeoffs which directly impact students.”