Public sector unions were counting on the Senate to slow down the push on Beacon Hill for health care givebacks, but it doesn’t look like that’s going to happen. Senate leaders unveiled a municipal health reform proposal today that gives unions a seat at the bargaining table for just 30 days and a slightly larger share of any cost savings, but not much more.
Union leaders have been saying all along that they are ready and willing to negotiate health care benefit reductions that will save municipalities money. All they want is to retain their collective bargaining rights.
The Senate proposal gives the unions what they asked for, but only for 30 days. After that, if no agreement on savings is reached, the municipality can unilaterally place its employees in the state’s Group Insurance Commission or a self-designed plan that matches the median benefits provided by the commission. Senate officials say their plan would save municipalities an estimated $100 million.
Most cities and towns collectively bargain health care benefits with each of their unions, but with costs rising quickly municipal officials want more direct control over the benefits they offer their workers. The Group Insurance Commission has become the benchmark in the debate. The commission designs the health plans it offers and sets the copays, deductibles, and premiums that all state and some municipal workers pay. The cost of the commission’s health plans are generally lower than those offered by municipalities.
Senate President Therese Murray has said she wants unions to have a seat at the bargaining table as municipalities work to rein in health care costs, but ultimately the Senate plan is not that different from the House’s.
The House plan lets municipalities unilaterally set copays, deductibles, and other charges as long as the costs do not exceed those of the Group Insurance Commission’s most popular plan. The Senate proposal requires a municipality to negotiate health plan changes with its unions for 30 days, but after that the municipality can unilaterally implement the changes it wants as long as their cost doesn’t exceed the median cost of the Group Insurance Commission’s plans.
“We have slightly different benchmarks, but both the House and Senate versions would use the Group Insurance Commission as their standard,” said Sen. Katherine Clark of Melrose, a key architect of the Senate plan.
Geoffrey Beckwith, executive director of the Massachusetts Municipal Association, was all smiles after the Senate Ways and Means Committee unveiled its budget proposal, which contained the municipal health reform package. “The communities do have plan design authority under this plan,” he said.
Where the House and Senate proposals differ is on how much of the health care savings should flow back to union members to mitigate higher copayments and other charges. The House proposal would send as much as 20 percent of the savings back to union members in the first year, while the Senate proposal would return as much as a third. Statewide savings estimates under both plans are in the $100 million range.
The Senate proposal also creates a Municipal Health Insurance Review Panel. If a municipality and its unions can’t agree on health plan changes within 30 days, the debate would shift to the review panel, which would consist of three members, one appointed by the unions, one by the municipality, and one selected jointly by both parties from a list developed by the executive office of administration and finance. If the unions and the municipality cannot agree on the third member, he or she would be selected by the secretary of administration and finance.
The review panel would review the municipality’s proposal. If it calls for obtaining coverage through the Group Insurance Commission or matches the commission’s cost structure, the proposal would take effect immediately. Otherwise the proposal could be sent back to the parties for further review. The review panel would also be charged with approving the municipality’s estimate of cost savings and apportioning up to a third of those savings to union members to mitigate their rising health care costs.
Both the House and Senate proposals are voluntary, meaning communities can choose to take advantage of the new bargaining tools or not.
Beckwith said he expected union challenges to the Senate proposal when it comes up for debate next week, but he said momentum appears to be on the side of municipalities seeking the tools needed to address rising health care costs. “This is an issue that’s not going to go away,” he said. “The House set the tone. The speaker set the tone.”