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Menino, unions in health accord

City workers will pay $70m more; labor preserves bargaining rights

Mayor Thomas M. Menino said he used every “resource available to try to achieve municipal health care reform.’’ Mayor Thomas M. Menino said he used every “resource available to try to achieve municipal health care reform.’’
By Andrew Ryan
Globe Staff / April 15, 2011

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Boston’s labor leaders signed an unprecedented agreement with Mayor Thomas M. Menino yesterday that will require municipal workers to pay $70 million more for their health insurance over the next four years and deliver substantial savings to the city as early as June.

The deal marked the first time that all of Boston’s unions banded together to negotiate benefits. But perhaps more important, it signaled that the push by local governments to shift substantially more health insurance costs to public employees may be all but a fait accompli in Massachusetts.

Union bosses who have sparred with Menino for years sat with him at a table at City Hall yesterday morning and signed the tentative contract, which requires a few pro forma steps before it is finalized. Employees will see insurance premiums rise 2 1/2 percent and their copayments increase significantly at the doctor’s office, pharmacy, and emergency room.

But unions also scored what they see as a critical victory: Health insurance remained a part of collective bargaining at a time of mounting pressure to remove premiums and copayments from the negotiating table.

“We really wanted to demonstrate that unions are not the problem, that we can be part of the solution,’’ said Jennifer Springer of the American Federation of State, County, and Municipal Employees, a lead negotiator for the union coalition. “I would hope that the folks at the State House will look at this and see that we don’t have to take away collective bargaining.’’

The deal took shape in a flurry of meetings over the last six weeks, as several dozen union leaders quietly crammed into a conference room at City Hall and hammered out details. Labor chiefs came to the table under intense pressure from Menino and Governor Deval Patrick, amid a broader national struggle over government spending that flared in places like Wisconsin, where new laws have hobbled unions.

In Boston, most details of the agreement had been finalized by Wednesday, when labor leaders got a fresh reminder of what would be at stake if they had second thoughts. House Speaker Robert A. DeLeo unveiled a proposal that would strip public employees of most rights to bargain over health care, giving mayors and town councils authority to set copayments and deductibles.

The Menino administration described the pact yesterday as a four-year “transition agreement’’ that will immediately cut government costs until Massachusetts enacts broader municipal health insurance overhaul. It represented a victory for the mayor, who has led an effort by municipal leaders to get public employees to pay more of their health care costs.

A caveat in the deal will keep Menino’s agreement linked to the statewide effort: If the State House fails to pass a new public employee health insurance law by the end of 2011, Boston’s agreement with its unions will be nullified.

“For more than five years, I have been using every resource available to try to achieve municipal health care reform,’’ Menino said in a statement. “As health care costs continue to rise and crowd out resources for other municipal services, this agreement will help provide the tools we need to keep teachers in classrooms, police on the streets, and our neighborhoods vibrant.’’

Labor leaders did not describe the deal as a transition to bigger cuts. They instead used the agreement as ammunition against what they see as draconian proposals on Beacon Hill.

“The mayor of the largest, most hard-to-manage city in the Commonwealth struck a deal on health insurance through collective bargaining,’’ said Tim Sullivan, a spokesman for the AFL-CIO of Massachusetts. “He just had to negotiate. All he did was use the budget realities that cities and towns face as leverage in the negotiations, and he was able to get an agreement and get a deal in the largest, most labor-dense city in the Commonwealth.’’

Yesterday, about nine union leaders, furious about DeLeo’s plan to cut collective bargaining rights for municipal workers, showed up unannounced at the speaker’s State House office and asked for a meeting to plead their case. They waited for more than 40 minutes.

“They’re laughing at us,’’ one of the leaders fumed, as he railed about DeLeo’s plan on his cellphone in a hallway outside the office. The speaker finally granted them a meeting, which lasted about 7 minutes, but the union leaders did not appear to succeed.

Around the same time, union leaders and Menino signed a deal at City Hall.

The agreement will kick in this June, when health insurance premiums for most city workers and some retirees will increase by 1 1/4 percent, raising the employee contribution to 16 1/4 percent. The hike will save Boston roughly $4.5 million over the next fiscal year, when the city’s health insurance costs had been projected to hit $315 million.

In summer 2012, premiums for most city workers will again increase by 1 1/4 percent. At the same time, copayments for most of the city’s health plans will also increase. The price of a doctor’s office visit will jump to $15 from $10. The cost of a specialist will rise to $25 from $10. Charges for the most basic prescriptions will double, to $10, and emergency room copayments will more than triple, to $100.

When the deal expires in 2015, one last rate hike will affect retirees on Medicare, whose premium will rise by 1 percent, saving the city another $400,000 over the next year.

The accord must be ratified by the unions, but it is not expected to face opposition. The Boston Teachers Union, the city’s largest collective bargaining unit with roughly 8,000 active employees, has already approved the deal, according to its president, Richard Stutman.

The Boston City Council must also authorize the pact, but there again, no hiccups are expected. Yesterday’s agreement actually allows councilors to avoid taking a tough vote in an election year on another Menino proposal that would have removed premiums and copayments from the negotiating table.

“Health care costs are a back breaker,’’ Council President Stephen J. Murphy said yesterday. “I think the unions saw what was going to go down on Beacon Hill. We want to continue in the spirit of collective bargaining. This does that.’’

Michael Levenson of the Globe staff contributed to this report. Andrew Ryan can be reached at acryan@globe.com.