THIS STORY HAS BEEN FORMATTED FOR EASY PRINTING

Officials give up on cutting health perks

Public employee unions defeat legislative effort

By Sean P. Murphy
Globe Staff / June 25, 2010

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The state’s public employee unions won a major victory this week when the Legislature abandoned efforts to allow cities and towns to trim generous health care benefits enjoyed by thousands of municipal employees, retirees, and elected officials.

The decision by lawmakers not to address the issue in next year’s budget means the Legislature will almost certainly not act on it this year, setting the stage for mayors and other municipal officials to take their case directly to voters in a ballot initiative for 2012.

“There are many mayors who feel strongly that there is such a desperate need to solve this problem that a ballot initiative is the right way to go,’’ said Mayor Thomas Ambrosino of Revere. “But I would hope before that we can try to negotiation a solution.’’

But one of the Legislature’s key leaders yesterday predicted it will be next year before the lawmakers next take it up.

“It’s very much a live issue, because it is so important,’’ Representative Charles A. Murphy, a Burlington Democrat who chairs the House Ways and Means Committee, said in an interview. In the end, he said, lawmakers simply ran out of time.

“Everybody on both sides of the issue acknowledges that the costs are an issue we have to address,’’ he said. “The trick is finding the middle ground.’’

Such a compromise over so-called plan design proved elusive during months of closed-door negotiations among mayors and union representatives.

Meanwhile, several measures intended to address health insurance costs in the House either stalled in committee or were deemed too controversial to be included in a broader bill covering a panoply of municipal issues.

The state Senate voted, 20-17, last month to add an amendment to the budget that would allow municipalities to shift, without negotiations with unions, some of the cost of health insurance to municipal employees, retirees, and elected officials.

The amendment came under harsh criticism from both sides, with municipal officials saying it was too weak and unions saying it went too far.

It was that amendment that was dropped by Wednesday evening, when Murphy and his Senate counterparts met in a final session to reconcile the Senate and House versions of the budget.

Public employee unions had passionately opposed that amendment and other measures that would have substantially removed health care benefits from the collective bargaining process.

“To do away with collective bargaining is a pretty big bridge to cross; I don’t see a Democratic Legislature or a Democratic governor doing it,’’ said Robert B. McCarthy, president of the Professional Firefighters of Massachusetts.

The Massachusetts Municipal Association, which represents mayors and other officials across the state, made control over health care benefits its highest priority on Beacon Hill, saying it would save cities and towns $100 million.

The Globe reported in February that health care costs added more than $1 billion to municipal budgets from 2001 to 2008. The plans provided to municipal employees, retirees, and elected officials are often unusually generous compared with the private sector, with cities and towns paying as much as 87 percent of premiums, while requiring as little as $5 in copayments.

In Somerville, Mayor Joseph A. Curtatone said yesterday that the city budgeted $42.4 million for health care benefits in the fiscal year beginning July 1.

That represents 24 percent of Somerville’s total budget, more than the police and fire budgets combined. Ten years ago, the city’s health care costs totaled $12.4 million, or about 9 percent of the budget.

“It is astounding that we haven’t had any action from the Legislature,’’ Curtatone said.

Unions in many cities and towns have agreed to marginally reduce the percentage of premiums their members pay, though it is not uncommon for cities to pay upwards of 80 percent.

Where the unions have been more unyielding is in plan design, the schedule of copayments and deductibles that come directly out of their members’ pockets for medical appointments, emergency room treatments, and prescription drugs. Municipal officials want to raise copayments and deductibles to reduce overall premium costs.

Pete DeVito, president of the 140-member Framingham firefighters’ union, said members have already agreed to cut the town’s share of premiums from 90 to 87 percent, but said that allowing town officials to boost copayments and deductibles was “too drastic.’’

Yesterday, Charles D. Baker, the Republican nominee for governor, criticized the lack of action, saying Governor Deval Patrick should have made it a higher priority.

“I would have literally gone around Massachusetts holding events with municipal officials to make the case for reform and to fight for it,’’ Baker said. “Where was the focus, the urgency, the drive to make this happen? It just wasn’t there.’’

Kimberly Haberlin, a spokeswoman for the governor, responded that Patrick “urged both sides of the plan design debate — cities and towns and unions — to work together to develop a compromise.’’

“He is disappointed a consensus agreement was not reached,’’ Haberlin said.

Sean Murphy can be reached at smurphy@globe.com.

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