The House Ways and Means Committee, chaired by Haverhill’s Brian Dempsey, released their version of the FY12 Budget this week, and it contained some real good news for municipalities throughout Massachusetts. The Dempsey budget did not change the local aid number recommended by the Governor, leaving unrestricted local aid, Chapter 70, and the Special Education Circuit Breaker funded at the same level as recommended by Governor Patrick. Nobody likes being cut, and the overall local aid cut statewide over the past three plus years is about 38%, but Chairman Dempsey and Speaker Deleo have made a real effort to spare local aid in this budget proposal. And they have recommended real municipal health care reform. An MMA summary of the Ways and Means proposal gives a flavor for the real scope of this initiative. And it is real good.
As drafted, municipalities that accept the new law 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 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 new 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.
The push-back from labor has been fierce, with labor leaders camping out at the Speakers Office, and the head of the Firefighters Union threatening retribution in November 2012. From the Globe.
Outraged union leaders said they would work to oust legislators who vote for the plan.
“The only thing that this budget does is silence the voice of working families,’’ said Edward Kelly, president of the Professional Fire Fighters of Massachusetts. “But those voices won’t be silent in November 2012.’’
In advance of full House consideration the lobbying has been fierce, with union locals, including Police, Fire, and Teachers, making multiple calls to their Reps to try to defeat this provision on the floor. Rep. Marty Walsh has filed an amendment dealing with this provision that has labor support, but so far I have not seen a copy that would give details. The full House vote is a real test of the strength of the labor unions in Massachusetts. They have been able to hold off badly needed reform in the Legislature for years, and this success has cost their members dearly, with job losses caused by the lack of reform coming directly at their expense. Collective bargaining in this area has simply failed to work, as labor, for the most part, has just said no to increased cost sharing in the health care arena. Even though this bill has a way to go it is already having impacts, as Mayor Menino just announced a comprehensive health care settlement with all of his unions that will save Boston taxpayers millions of dollars.And while the unions are trumpeting this as a sign that collective bargaining can work in the health care area it appears to have taken the real threat posed by the legislative reform effort to bring this about.
As a Mayor I have negotiated two major health care deals through Section 19 bargaining, as well as 30 plus individual contracts through the bargaining process. I do believe that bargaining can work, but for some reason it just has not been successful, statewide, as a tool to bring more balance to municipal health care costs. The House has taken a huge, and vital, step in the right direction with Chairman Dempsey’s proposal. It favors property taxpayers while still providing OUTSTANDING health care to municipal employees, and allows municipal managers to utilize savings to protect union jobs and municipal services. Great job by Chairman Dempsey and Speaker Deleo.