Menino to file bill to weaken unions' hand in city health negotiations

Frustrated with stalled efforts on Beacon Hill to empower city and town administrators to design health plans for their workers, Boston Mayor Thomas Menino announced Wednesday morning that he intends to file legislation to establish a local version of the state's Group Insurance Commission, a plan that would reduce labor union influence on health care negotiations.

“If it’s good for the state, it’s good for Boston,” Menino said at a Suffolk University forum, flanked by Salem Mayor Kim Driscoll and Melrose Mayor Rob Dolan.

Menino, who recently put his muscle behind Gov. Deval Patrick’s reelection effort, said Boston spends $300 million a year – and climbing – on health care costs for city workers, greater than the budget for the city’s police department, and that Beacon Hill has failed for too long to produce a plan to alleviate cost increases. Patrick has opposed giving city and town leaders unilateral control over health care plans, arguing that unions should have a voice in the process.

The mayor’s proposal would only apply to Boston and would require City Council approval.

Unions have rejected calls by municipal officials for unilateral plan design authority, saying that health care benefits should be negotiated through collective bargaining, and that adjustments to co-pays and deductibles fall on the backs of workers, especially in tough times.

“The unions are working very hard on this problem too,” said Ann Clarke, executive director of the Massachusetts Teachers Association. “The problems on our side of the table are very difficult to deal with as well. It’s a very personal issue.” Clark wondered whether the mayor’s would include “meaningful” participation for unions.

“There has to be give and take here,” Menino said. “We’re heading for a collision out there.” Without action, he said, “There’s going to be a catastrophe in local government.”

Lt. Gov. Tim Murray said Menino’s plan is “absolutely” a viable solution and he said the mayor’s efforts would be “critical” to solving the dicey issue.

“We think that people have a right to have a voice at the table and we are open and willing to compromise,” Murray told reporters. “What we have said no to is universal decision making by a CEO to issues on health insurance. We need to make changes and make some improvements.”

“We are willing to have discussions about plan design and issues like that with the idea that everybody has a voice and a vote, like they do with GIC,” Murray continued. “I had some conversations yesterday with at least one mayor and people internally about how do we move that discussion.”

Menino said his proposal would ensure that unions have a say in their health care benefit, noting unions have a seat on the board of the state Group Insurance Commission, which sets co-pays, deductibles and the benefit structure for 300,000 state workers and dependents. However, his proposal would prevent unions from unilaterally blocking changes to health plan design.

Boston officials said the mayor’s proposal would hew closely to the GIC, giving a voice to retirees, labor, the teachers union, and the city officials who oversee health benefits. Menino said the plan should satisfy Patrick’s demand that unions get a “seat at the table” but would strengthen municipal officials’ bargaining position.

Patrick has touted his administration’s 2007 push to permit cities and towns to join the state GIC, but only about 20 of the 351 municipalities in Massachusetts have garnered enough union support to join. City and town officials say the threshold for union support – 70 percent – has proven too cumbersome. Murray said Wednesday that the administration intends to move ahead with plans to lower that threshold to 50 percent of local union members.

If the Legislature fails to act on his plan, which has yet to be drafted, Menino said he would get behind efforts to put a plan design question on the ballot in 2012. City and town leaders say they would need action by March to ensure that savings would be realized in next year’s budgets.

Driscoll said union inflexibility on changes to health care plans forced unnecessary layoffs this fiscal year and prevented savings in her city of 42,000 residents. She said she had proposed raising worker co-pays to $20 from $5 this fiscal year, a move she said would have reduced health care premiums and saved $1 million.

“All eight collective bargaining units turned us down,” she said, noting that health costs consume 10 percent of the city’s $130 million budget.

National health reform, she added, would likely worsen the problem because it prohibits health plans to charge co-pays for routine primary care visits.

The state Senate attempted to find a middle ground during budget negotiations in June, but a proposal narrowly approved in that branch and criticized by both unions and municipal officials was dropped during talks with the House.

Municipal officials sought a signal from the Patrick administration on municipal health care cost control efforts on Tuesday but received no specifics. At Wednesday’s forum, Mayors Menino, Dolan and Driscoll spoke aggressively about inaction in the State House.

“There’s a pigheaded attitude on Beacon Hill and to be honest, amongst some mayors and big labor,” Dolan said, adding, “There’s too much boutique, special interest legislation that takes care of smaller groups.”

Menino said Massachusetts was “very fortunate” to escape “revolutions” that took place in other state and local governments during last week’s elections.

“We don’t have that yet,” he said. “We’re close to it.”