22 Aug 2014
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Council Votes for State's Municipal Healthcare Reform

Employee unions were absent as eight councilors agreed to new process for negotiating health insurance benefits.

Council Votes for State's Municipal Healthcare Reform

The voted Wednesday night to accept the state's new municipal health insurance law for negotiating health care benefits for the city's 1,500 employees plus retirees.

None of the eight employee unions showed up to oppose or support the change. Last month when the council first took up the issue, the presidents of the police, fire and teachers unions asked for more time to study the proposed changes and educate their members.

The council, over the objection of Mayor Kimberley Driscoll, agreed to the delay until last night. That was one day after the council elections.

The state enacted the new law last July to allow cities like Salem to have more leverage in negotiating with employee unions on co-pays and deductibles. The mayor said Salem might save 5 percent or about $600,000 a year under the new law.

The city, which pays 73 percent of the employees' premiums, spends about $11 million a year on healthcare insurance.

The new state law includes an option for communities to join the state's Group Insurance Commission, if they can save at least 5 percent in health care expenses over their own plans.

The new law also provides for an expedited bargaining process. Over the next few months the mayor will convene a committee, called the Public Employees Committee, made up of representatives of each city union, plus a representative of retired workers. The committee would have 30 days to negotiate changes in the health plan with the administration.

In the timeline the mayor outlined, that 30-day period will probably occur in December and January.

If this committee and the administration cannot reach an agreement, the issue would go to a three-member panel made up of one member appointed by the unions, one by the city and one by the Secretary of Administration and Finance from a pool of three candidates agreed to by the two sides.

This committee would have 10 days to issue a ruling.

The only question raised by the council in its debate was a provision that bars any change in contributions by retirees until 2014. City Finance Director Richard Viscay said the city has never considered increasing the contributions for retirees from the current plan.

The mayor, confident that the measure would pass, did not attend the council meeting.

Most of the councilors had conflicts in voting on the new law because they participate in the city's health insurance or have immediate family members who are participants in the program. Under a rarely used law, called the Rule of Necessity, the conflicts were waived after each member disclosed the specifics of his conflicts.

Of the eight councilors on hand last night, only Councilor-at-Large Joan Lovely and Ward 6 Councilor Paul Prevey did not have a conflict. Councilor-at-Large Arthur Sargent recused himself from the debate. Absent were Ward 5 Councilor John Ronan and Ward 7 Councilor Joe O'Keefe.

Ward 3 Councilor Jean Pelletier noted that he would have a conflict only until Dec. 31 when his current term expires. He was not reelected Tuesday.

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