Bellicose Bumpkin

Kevin Cook drew my attention to this Globe article about the skyrocketing costs for the generous health care benefits that cities and towns provide their employees. The article characterizes municipal plans as far more generous than those in the private sector. Lack of political will at the state and local levels have contributed to the problem.

Issues covered in the article:

• Lifetime benefits given to employees, elected officials with short service time
• State law that requires towns to cover retirees and towns that don’t force retirees onto Medicare at age 65 – continuing to provide cadillac healthcare plans instead.
• Doubling of municipal healthcare costs from 2001 to 2008
• Prop 2 1/2 caps on taxes means that health care cost increases eat up all revenue increases. This means closed fire/police stations, reduced library hours, etc.
• Overly generous benefits that insure a family will always choose the public health plan of one spouse over the private plan of the other.
• Prop 2 1/2 override efforts are partially spurred by health care cost increases – overrides that are short term solutions.
• Benefits for current and future retirees are an unfunded liability is in the hundreds of millions for some cities – $600M for Brockton and $5.7B for Boston
• Elected officials in some towns also get health care benefits: “Six former city councilors are insured by Everett, plus 12 current ones. In Kingston, 10 part-time elected officials receive town-subsidized health coverage, including four Planning Board members, three Health Board members, and a sewer commissioner, all of whom typically attend two meetings a month.”
• Municipal health care plans are far more generous than private sector ones on average. Lower co-pays, lower employee contribution percentages, and greater benefits.
• State law that subjects benefits to collective bargaining
• Lack of local political will – “Communities, under a state law passed in 1991, can force employees to enroll with Medicare, but only if the change is approved by the city council or town meeting. In some places, that has proven politically difficult, given the clout of active and retired municipal workers.”
• Overly generous pensions that allow police, firefighters, and teachers to retire before age 65. This makes them ineligible for Medicare even if the town had the political will to compel them to use it.