House panel approves hard cap for public employee health care

Capitol building

The state House Oversight, Reform, and Ethics Committee today passed legislation that would limit how much public employers can pay for employee health care.

Under House Bill 4572, public employers could pay up to $5,000 for single coverage, $10,000 for two-person coverage, and $15,000 for family coverage.

MEA opposes the bill because local units of government, including schools and universities, should decide through collective bargaining how to manage health care costs. The bill offers a one-size-fits-all approach to employee health care, without regard for regional differences in costs or availability of physicians or health care facilities.

Under this plan, working families would bear a disproportionate share of future medical care costs increases. If, for example, an employee group of fewer than 1,000 employees experienced one or two expensive medical problems such as a case of leukemia or a premature baby, the out-of-pocket costs for insurance could rise from $3,000 to nearly $7,000 or more in just two years, making coverage unaffordable to thousands of public employees.

The bill, along with Senate Joint Resolution C, now goes to the full House. Contact your state representative NOW to ask the following questions:

  • Does the hard cap deal equitably with public employees at various salary levels?
  • Will a public employee earning $30,000 a year pay the same for their health care as a public employee with a $60,000 salary?
  • Does the hard cap discriminate against public employees in different geographic areas?
  • Does the hard cap discriminate against public employees of different ages?
  • Does the hard cap discriminate against female public employees?
  • Is the hard cap legal?
  • Does the hard cap prevent local control?
  • Will the hard cap cost public employers more money than the current health plans they offer? How much?
  • How much will it cost public employers to implement the state government-mandated hard cap?
  • Does a hard cap prevent creative savings at the local level?
  • How much will it cost the state to implement and oversee the hard cap?
  • Will the hard cap force Michigan to lose $100 million in federal transportation dollars?