House Speaker Andy Dillon made a personal appearance at the Grand Valley Metro Council’s headquarters last month.
The Redford Democrat talked with council members for two hours about his proposal to reform health insurance coverage for state, county and municipal employees and retirees, asking their input.
“We are making the tough calls and we are negotiating in good faith with our bargaining units. Don’t do anything that messes that up,” said GVMC Executive Director Don Stypula of his main message to Dillon at that meeting.
Dillon wants to consolidate insurance coverage for virtually all public employees and retirees in Michigan, an effort that would be managed by an appointed board. A House fiscal analysis of his proposal revealed that annual savings would range from $565 million to $870 million. Dillon recently introduced his bill in the state House.
“The bill we’re seeing is elegant in its simplicity. It leaves a lot of the decision-making up to the board,” said Grand Rapids Mayor George Heartwell, who was sworn in as a member last week after serving on the council in 2004 and 2005.
Stypula pointed out that the Democratic caucus has to side with Dillon for his bill to get to the Republican-led state Senate, and that may not be an easy task. Many of the public-employee labor unions are suspicious of a statewide insurance pool and have traditionally supported Democrats in state elections. So caucus members may not want to go out on a political limb for him.
“Next year is an election year. How they position themselves is very, very important,” said Stypula.
The Center for Michigan, an independent nonprofit organization that describes itself as a think- and-do tank, found that insurance pools in other states have saved taxpayer dollars. In seven states used for cost-comparison purposes, taxpayers spent an average of $6,435 per enrollee for coverage, while Michigan taxpayers paid $9,386 per year for each employee and retiree covered in 2008.
The center also found that enrollees in most other states paid a higher percentage of their premiums than in Michigan. While state employees and retirees pay 10 percent here, those in California pay 16 percent, 20 in North Carolina, and 25 in Georgia.
The center’s researchers John Bebow and Scott Rasmussen admitted their report was not an “apples-to-apples” comparison because it didn’t delve into the benefits as their assignment was to examine costs.
“Through that lens, it is clear that taxpayers in pooling states are paying less than Michigan pays for its state workers’ benefits. In that respect, Michigan is arguably not cost-competitive with the pooling states examined,” wrote Bebow in the report.
The Metro Council applauded Dillon for his leadership and also asked to be included in any discussions regarding his reform effort.
Under Dillon’s proposal, 13 political appointees would be named to a board that would manage the insurance pool. A director and staff would choose the best plans for consideration and then submit them to the board for review.
“I don’t know whether I’d want to be on the board or run away from the board,” said Stypula. “It will be a lot of work.”