Patrick Torn Over Labor Role's in Muni-Health Reform Plan
July 6, 2011
By Michael Norton
STATE HOUSE, BOSTON, JULY 6, 2011…..Facing lobbying on both sides of the issue, from unions and business groups, Gov. Deval Patrick told the News Service Wednesday he is torn over whether the role laid out for labor in municipal health insurance reform legislation on his desk is adequate.
In a brief interview with the News Service, following a mid-afternoon meeting with House Speaker Robert DeLeo that focused on the reform proposal, Patrick said he wasn’t sure yet whether he’d sign off on the reform plan or propose an amendment to make it more to his liking.
“It’s a really good bill and I’m really not decided yet about what I want to do,” Patrick said. “It achieves the savings. It does have a role for labor. I think trying to sort out whether that role is meaningful enough from labor’s point of view without jeopardizing any of the ease or speed of achieving the savings is a question I’m trying to turn over.”
Patrick said he’d been talking to “a lot of people” about the muni-health reform, including DeLeo.
Municipal officials, saying surging health care costs are preventing investments in other areas and consuming local budgets, have pushed hard this year for enhanced authority to control and shift insurance costs. They say reforms will save $100 million this year, with savings compounded in future years.
The $30.6 billion fiscal 2012 budget approved by the House and Senate Friday and sent to Patrick’s desk includes the muni-health reform proposal. Under the Legislature’s plan, cities and towns would have the option to make unilateral health plan design changes after an expedited 30-day bargaining window as long as 25 percent of the achieved savings are redirected back to employees.
Three Senate Democrats last Friday railed against the reform proposal, saying it trampled on collective bargaining rights. Calling the plan "a direct attack on the middle class," Sen. Marc Pacheco (D-Taunton) urged Patrick to revise or veto the reform plan before signing the fiscal 2012 budget blueprint.
Fifteen labor groups indicated Friday they were disappointed with the Legislature’s plan and planned to seek changes “to protect retirees and people who are very sick” and to protect labor’s voice in the process. The Public Employees’ Coalition on Municipal Health Insurance, which includes unions representing teachers, firefighters, police and other municipal workers, indicated it planned to lobby Patrick for a bill that achieves savings for municipalities “while still being fair to public employees and retirees.”
A coalition of business and civic groups on Wednesday urged Patrick to sign the reform without amendments and “meet his commitment to provide cities and towns with the tools they need to save jobs, control costs, and deliver vital public services, while preserving labor’s significant role in the process.”
“Municipal employees will continue to receive excellent health care, which at a minimum will be the same that state workers receive, and they will retain greater bargaining power than afforded state employees,” the business and civic groups said in a statement. “The Legislature’s plan will achieve real savings within the next fiscal year, while preserving generous benefits for retirees and employees and ensuring labor a meaningful seat at the table.”
The statement was signed by Associated Industries of Massachusetts, The Boston Foundation, the Boston Municipal Research Bureau, the Greater Boston Chamber of Commerce, the Massachusetts Business Roundtable, the Massachusetts High Tech Council, the Massachusetts Taxpayers Foundation, the Massachusetts Business Alliance for Education and Stand for Children.
The legislative proposal was reached after labor groups ripped the House in April for voting to strip workers of collective bargaining rights, comparing the plan to those advanced in other states, including Wisconsin where political leaders eliminated fundamental and long-held negotiating powers of labor unions.
Legislators insisted throughout the process of developing a reform plan that they were seeking a balance that preserved a voice at the bargaining table for labor without giving unions the ability to effectively veto changes. Reform critics say planned savings will be effectuated by shifting costs to employees.
The Legislature’s plan allows municipalities to present to a public employee committee a proposal for plan design changes, including increases in co-payments and deductibles, or to suggest transferring of employees into the state's Group Insurance Commission.
The city or town would have 30 days to negotiate the changes with the committee - comprised of one member from each collective bargaining unit and a retiree representative - as well as proposals to offset the impact of higher employee costs with programs such as health reimbursement accounts.
If a majority of the employee committee does not agree to the management offer after 30 days, a three-person panel, including one independent arbiter, would be authorized to implement the plan design changes, but would be given 10 days to decide how to share up to 25 percent of the achieved savings with subscribers, including retirees, low-income subscribers and large health care utilizers.
Co-payment and deductible levels would not be allowed to exceed those of the most-subscribed health plan in the GIC for each employee group, under the terms of the agreement, but increases beyond that level could still be pursued through traditional collective bargaining.
According to officials, the most subscribed plan for active employees in the GIC is currently the Navigator plan, offered through Tufts Health Plan, carrying deductibles of $250 for individuals and $750 for families.
The final agreement dropped a Senate-approved provision that would have required cities and towns to offer the same premium cost split for retirees as current employees. Supporters of that provision said it would protect retirees living on fixed incomes while critics claim it could wipe out the savings envisioned by the bill’s architects. The plan on Patrick’s desk puts a two-year moratorium on increases to retiree premium contribution ratios for municipalities that impose plan design changes.
Also under the proposal, all eligible municipal retirees would also be required to enroll in Medicare, an idea that has generated little controversy, but which has become hung up in recent months in the larger debate over deciding who pays the tab for rising municipal health premiums.
While he had sought mandatory participation by cities and towns in muni-health reform efforts, Patrick on Wednesday appeared resigned to the local option nature preferred by the Legislature. “We’re past that,” he said. “The reason I wanted mandatory is I’m tired of excuses. You know what I mean?”