Battle Rages Over Municipal Health Care

Municipal Leaders Demand Control

JANUARY 2011 VOICE: Within days of the November election, a coalition of mayors and the Mass. Municipal Association were back on Beacon Hill in an attempt to rally support to grant local officials complete control over health insurance plan design.

Spearheading the charge for local control is Boston Mayor Thomas Menino, who announced a Boston home rule petition that would create a city-run group insurance commission. Other communities would prefer a model in which the mayor or town manager would have direct authority over the local insurance plan, without the need to negotiate changes in plan design.

"Plan design" does not just refer to selecting the type of insurance coverage and specifics to be covered, but also the setting of copayments and deductibles. While the premium contribution split would still be set by either collective or coalition bargaining, allowing local officials to gain complete control to set out-of-pocket costs is troubling.

Local officials have long argued that in order to control the ever-rising cost of health care they must be granted the ability to make changes to insurance plans without having to negotiate the changes.

Joining Menino's call for plan design control are Mayors Joseph Curtatone (Somerville), Robert Dolan (Melrose), Kim Driscoll (Salem), Mark Hawke (Gardner) and William Scanlon (Beverly) among others.

Our Boston members do enjoy a positive relationship with Mayor Menino. While there is a clear difference of opinion over health care governance, those differences are not made to be personal.

"Unfortunately, we continue to have problems in places like Somerville and Salem where the mayors have unfairly targeted retirees to shoulder the budget burden. Not only has Somerville greatly increased insurance costs on retirees, but Mayor Curtatone blocked the COLA in 2010," said Association President Ralph White. "Some of these mayors and other local officials seem to pride themselves in joining an anti-retiree crusade. There is just no need of it."


Menino's plan, which has been discussed in the past, would allow Boston to establish its own "mini-GIC". Modeled after the state's Group Insurance Commission, the local version would create a municipal commission to oversee and establish its health insurance policies.

Under the proposal, Boston's health insurance plans would no longer be subject to collective bargaining. Plan design would be established by the commission, on which there would be a retiree and labor representation. However, the mayor would control the majority of the seats on the commission.

The Group Insurance Commission, which was created in the 1950s, is highly regarded and credited with helping to keep the state's insurance costs relatively low. Now insuring over 300,000 people, the 15-member state GIC employs a professional staff and a variety of specialized consultants to help manage the state's insurance plans.

Despite the presence of several local insurance collaboratives, only the Mass Interlocal Insurance Association (MIIA) is currently equipped with a full-time insurance staff. MIIA is a sister organization to the MMA, insuring over 100 local communities and over 20,000 people.

"Other than Boston with nearly 35,000 enrollees, I can't see many municipalities with the ability to successfully manage their own mini-GIC. A lot of work goes into it, well beyond simply establishing a commission," explained Association Legislative Liaison Shawn Duhamel. "Beyond the traditional collective bargaining, we still feel strongly that the answer rests with negotiating insurance benefits through the Public Employee Committee under coalition bargaining."

As we have reported, PECs are comprised of a retiree and labor representatives, who negotiate over health insurance benefits and contributions with municipal officials as a coalition. A vote of 70% of the PEC is needed to affect any change in insurance coverage or rates.

Under coalition bargaining, also known as Section 19, a PEC and local government can also agree to join the state GIC or other insurance group.