Massachusetts Unions Shape Compromise For State’s Municipal Health Insurance Law

Massachusetts Unions Shape Compromise For State's Municipal Health Insurance Law

Toner

The new municipal health insurance law signed by Mass. Gov. Deval Patrick in July represents a compromise forged during very challenging fiscal times. The process was difficult and sometimes contentious, but it never devolved into an angry ideological standoff like those seen in so many other states and in Washington, D.C.

In Massachusetts, municipal health insurance benefits are negotiated separately in every city and town, while state employees’ benefits are all in one big pool called the Group Insurance Commission. In the face of escalating health care costs and declining revenues, municipal officials have for several years sought the unilateral right to make plan design changes or to move municipal employees into the GIC.

A coalition of public employee unions proposed an alternative in March. We recommended that municipalities have the right to make some cost-shifting changes as long as three principles were honored:

    –The right to an expedited form of collective bargaining with a fair mechanism for resolving disputes.

    –Protection for retirees.

    –Relief for employees and retirees who have exceptionally high health care costs.

In the end, both sides got some of what they wanted. The projected savings for municipalities is $100 million a year.

Municipalities now have the authority to increase co-payments and deductibles to bring down premium costs. However, they cannot impose higher co-payments and deductibles than are paid by state employees, including legislators themselves.

We retained the right to bargain over some details of the plans and over the premium splits, but the bargaining must occur quickly and within a tighter box. Three-member panels will resolve disputes.

We won some new protections for retirees, but for a shorter period of time than we had sought.

Although heavy users of health care will ultimately pay more under this law, we won a requirement that up to 25 percent of the first-year savings be used to reimburse those with very high out-of-pocket costs.

The lessons learned from this multi-year process are important. For employers and political leaders, a key point is this: Don’t demonize the employees and their unions. Our governor said publicly, “Unions are not the problem.” By making that statement and agreeing to include us in the process from the start, he turned down the heat and enabled the discussions to proceed. It helped that his secretary of labor and workforce development, Joanne Goldstein, is a genuine advocate for working people and had credibility on both sides of the issue as she shepherded the bill through to final passage.

In Massachusetts, as in other states, there has been some gratuitous union bashing in the media, but most of our political leaders are smart enough to recognize that the majority of voters support the right of employees to form unions to advocate on their behalf. It helps that unions, by boosting compensation for the middle class, shore up our faltering the economy and reduce inequality.

A key lesson for the unions is this: Even if our members didn’t cause this fiscal crisis, the crisis is upon us, and we have to be part of the solution. Instead of blindly saying “no” to all proposed changes, we looked at the numbers and acknowledged that municipal health care costs were indeed a problem. We defended our principles while being able to offer solutions. In the end, neither the unions nor the municipalities got everything they wanted. That’s what genuine negotiations look like.

Paul Toner is president of the Massachusetts Teachers Association. The MTA, a state affiliate of the National Education Association, was a member of the Public Employees’ Coalition on Municipal Health Insurance, which advocated for a balanced solution to the rapidly rising costs of municipal health insurance.

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