MTA's position on Speaker DiMasi's GIC proposal

Speaker of the House Sal DiMasi announced December 8 that he plans to file a bill that would amend the recently passed Group Insurance Commission law by allowing municipalities to unilaterally require employees to receive their health insurance through the GIC without union approval.

The MTA strongly opposes this proposal and will continue to defend the new law as it currently exists.

Background

Recognizing the need to contain and possibly reduce the cost of health insurance for cities and towns, the MTA began working in the fall of 2005 with the Municipal Health Insurance Working Group. The working group, made up of organizations and individuals representing public employees, retirees, cities and towns, legislators and the state Group Insurance Commission, met for 18 months to develop a proposal that would allow, but not require, teachers and other municipal employees to receive their health insurance through the GIC.

That bill was approved by the Legislature and signed by Governor Deval Patrick on July 25, 2007, and is now Chapter 67 of the Acts of 2007. Under this law, municipalities and school districts seeking to enter the GIC may do so on October 1 of each year after negotiating the change and upon approval by public employee unions and retirees representing 70 percent of those affected. The MTA fully supports the law as enacted. Our position is explained in greater detail below.

DiMasi’s plan strikes a blow at the heart of employees’ fundamental collective bargaining rights.

Collective bargaining is the mechanism through which ordinary workers have meaningful input in what their economic lives will look like. Denying employees the right to have any say over their health insurance plans is an attack on the rights and interests of working people in this Commonwealth.

Health care benefits are a key component of overall compensation.

Health care benefits are part of an overall compensation package that has been negotiated over many decades. Allowing municipalities to make unilateral decisions about what health insurance plan to use could cost some employees thousands of dollars per year in increased co-payments and deductibles. Many employees have given up salary increases and other benefits in order to retain good health care benefits.

The new law is fair and is working.

Chapter 67 establishes a process involving all the stakeholders in determining whether entering the GIC makes sense. This process includes conducting in-depth analyses of the costs and benefits of the GIC health plans versus those currently offered. After much study and negotiation, 24 cities, towns and regional school districts have now joined the GIC, including several large communities such as Springfield and Quincy.

DiMasi’s plan is unnecessary.

The speaker’s proposal implies that municipal leaders across the state are seeking to enter the GIC and the local unions are resisting unreasonably. That is not the case. According to health insurance analysts at Boston Benefits Partners, the GIC issue has not even been raised in hundreds of communities – the vast majority of the state’s 351 cities and towns. That may well be because they believe that their own plans are adequate, or that competition from the GIC has forced their current insurance providers to lower rates.

In the overwhelming majority of instances where a municipality or regional school district has seriously pursued entering the GIC, the local unions have agreed after negotiating the specific terms. Public employees have rejected entering the GIC in only one community where a plan was fully negotiated and brought to them for a vote.

Why target employees?

The speaker fails to mention that in some instances municipal leaders have resisted going into the GIC, not the unions. In North Adams, for example, all of the public employee unions have asked to bargain over entering the GIC, while the mayor has refused to even discuss the issue.

The GIC could not accommodate a huge influx of municipal employees.

The GIC has been very supportive of incorporating municipal employees into the system. That said, the agency has said that it would be a bureaucratic nightmare to extend the service to a large number of municipal employees at the same time. Proceeding at a measured pace, as the bill envisions, will result in a smoother transition.