You not eligible to deduct premiums for health insurance if
either you or your spouse is eligible to participate in a
subsidized health plan maintained by any employer of either
you or your spouse. See Code section 162(l)(2)(B).

From your description of the situation, it doesn't look like
you'd be able to deduct your premiums.

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I am starting a new contract position (1099) and have a
question about medical premiums.

The setup:
My spouse works in the local school system and has access to
an excellent insurance plan. The problem is that she
doesn't make enough annually to pay for the plan, so it has
to be paid for out of pocket. That makes it substantially
more expensive unless since I am self-employed I can claim
it on my 1040.

To complicate matters, the school subsidizes the cost of the
plan, but only to the tune of 5%. I have not yet determined
if this can be changed (if they'll offer it at cost instead
of subsidizing it), but I am looking in to it as I am under
the belief that a subsidized plan's premiums can be claimed
as my self-employed insurance costs, correct??

My alternative is a less attractive plan through my employer
of record. That would be pre-tax dollars for me, but the
copayments etc are MUCH higher.

Any advice is appreciated!

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