Statement of the MMA endorsing the House’s municipal health insurance reform proposal

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For immediate release – For more information, contact Geoff Beckwith or Patricia Mikes at (617) 426-7272

On behalf of local officials across the state, the Massachusetts Municipal Association (MMA) strongly and fully endorses the municipal health insurance reform proposal included in the House Ways and Means Committee budget, which was released today. We commend Speaker Robert DeLeo, Ways and Means Chair Brian Dempsey, Vice Chairs Stephen Kulik and Marty Walz, the members of the Ways and Means Committee, and the speaker’s leadership team for recognizing the need for reform and proposing a plan that offers powerful relief for local taxpayers and all communities.

The plan proposed by the speaker and the House Ways and Means Committee offers real reform for cities, towns and taxpayers. The measure would give cities and towns the same power the state has to implement necessary changes in municipal health insurance plans, saving local taxpayers up to $100 million in avoided costs.

Communities are in fiscal crisis, and municipal health insurance reform offers meaningful relief that taxpayers deserve. Skyrocketing health insurance costs are forcing cuts in essential municipal and school services, and forcing the elimination of teachers, firefighters, police officers and other key employees from local budgets. Communities will use this reform to provide relief for local taxpayers, protect essential services, and preserve thousands of municipal jobs.

Under the bill, municipalities would be able to modernize the design of their employee health plans outside of collective bargaining, with a guarantee that all municipal and school employees would still have health plans that are the same as or better than what state employees receive, meaning no city or town could use this authority to implement higher co-pays or deductibles than the state.

Communities would also have the power to join the Group Insurance Commission outside of collective bargaining if they demonstrate that joining the GIC would provide greater financial relief than making plan design changes on their own.

Ten percent of the savings or costs avoided in the first year would be set aside to fund a health reimbursement account that would be structured based on an agreement between municipalities and their unions.

Cities and towns would still negotiate any change in the employee-employer premium share, giving municipal unions more bargaining authority over health insurance than state employee unions. Any co-pays or deductibles higher than the GIC plans would have to be approved in collective bargaining.

The bill simply gives plan design parity and options to cities and towns.

Municipal employees would benefit from the legislation in three ways: union jobs would be protected, employee premiums would be lower, and communities would establish health reimbursement accounts to offset a portion of the costs for those employees who are heavy users of the health care system.

The legislation proposed by Speaker DeLeo, Chair Dempsey and the House Ways and Means Committee saves taxpayers money, preserves essential local services, protects municipal union jobs, guarantees equity with state employee health benefits, and still leaves municipal unions with more bargaining power than state unions.

This is a balanced, meaningful, fair and transparent reform that would allow cities and towns to save $100 million in avoided health insurance costs.

The MMA strongly endorses this measure, and asks the full House to embrace it wholeheartedly.