Retiree Healthcare Siege Continues

MTF Report Misleading

OCTOBER 1, 2014: Last week, the Mass. Taxpayers Foundation (MTF) released its latest report on municipal retiree health insurance. As expected the report finds that the cost of municipal health insurance plans is unsustainable, and as such, benefit reductions are called for. Click here to view the report.

Unfortunately, the MTF report has drawn undue attention from the Boston media. Just last Saturday the Boston Herald editorialized (see "The Retiree Dilemma") on the subject, largely echoing the MTF recommendations.

We believe this typical MTF report uses selective data to produce results that reflect their agenda – a flawed methodology that most reputable professional research entities would not utilize in trying to compile an objective analysis.

Specifically, limiting the use of property tax levy in the 10 "poorest" communities as the focal point for the report's findings is not really an objective measuring stick.  State aid and other revenues, generally doubling the property tax levy, must be included in the equation to objectively analyze a community's ability to pay.

In addition to poor methodology, the report intentionally neglects to state the $250M in heath care savings that resulted from the Governor and legislature passing municipal Health Care Reform in 2011. Ironically, the report omits the City of Fall River from its findings and the Health Care Reform savings to the taxpayer in that city was over $8M in FY14 and a total of $12.104 million since FY13!!

Further, several of the communities profiled by the latest MTF report have not enacted the reforms already passed by the Legislature over the past five years. Simply put, the tools are already available for municipalities to gain control over local healthcare costs.

Four of the profiled communities have reported a collective savings of $16.468 million as a result of instituting municipal insurance reforms. However, the MTF fails to mention this data in their report.

  • Amherst $1.683 million
  • Chelsea $1.405 million
  • Fall River $12.104 million (FY12-14)
  • Fitchburg $1.190 million

We understand that further health care reforms will have to be discussed, but shifting even more costs on public retirees and employees is not the solution. And taking health coverage away from non-Medicare eligible retirees is definitely not the way to go!

Our Association remains committed to working with the legislature, policy makers and the incoming administrations to resolve these important issues.