Cynical Synapse

Wed, 02 Sep 2009

Dillon’s Public Employee Healthcare Plan—Tilting at Windmills?

Filed under: Budget, Business, Economy, Government, Michigan, Politics — cynicalsynapse @ 11:27 pm

Andy Dillon (D-Redford Twp), Speaker of Michigan's House of Representatives.

Don’t get me wrong. Michigan House Speaker Andy Dillon’s proposal for public employee healthcare pooling warrants due dilligence and more than careful consideration. Problem is, it’s not relevant to the current budget crisis. Any savings to be realized are at least a year down the road, if not more. Although the idea’s been around for a while, the introduction of a bill by Dillon (D-Redford Twp) now is, at best, poor timing. We’re not hearing anything on budget negotitions from the State House or Governor’s office.

Speaker Dillon claims his plan will save Michigan $900 million a year, but there are plenty of skeptics, including fellow Democrats. But even if the plan doesn’t save as advertised, it’s still a move in the righ direction.

A recent study concluded Michigan pays more for health insurance than nearby states for public employees. Here are the details.

What the bill would do:

  • Allow the state to develop a selection of plans for public employees
  • Create a pool into which all public employees pay a premium to fund the program
  • Establish a 13 member board to represent unions, employees, and the state
  • Increase employee shares of high-end plans

What the bill would not do:

  • Pre-empt existing collective bargaining agreements
  • Impose specific health care plans or pick insurance companies
  • Eliminate union’s ability to negotiate terms of health care
  • Determine the cost of the program

Dillon claims the plan will save big money by emphasizing wellness and prevention programs.

Not surprisingly, school administrators support Dillon’s proposal while unions—particulary the Michigan Education Associaton (MEA)—opppose the plan. The MEA cooked the numbers to justify their own over-priced insurance plan, the Michigan Education Special Services Association (MESSA). An affiliate of MEA, MESSA currently covers the majority of Michigan’s teachers. If Vicksburg’s case is representative, MESSA’s costs of $14,898 for family coverage are 15% higher than the private sector’s midwest average of $13,255.

If Dillon’s plan does nothing more than save $1,000 per head in insurance costs, it will be well worth it. Never mind his claim for nearly a billion in savings.

%d bloggers like this: