Growing Concern: Premium Freeze Expiring

JANUARY 2014 VOICE: An issue of great concern to the Association is the end of the legal moratorium on increasing retiree and survivor health insurance contribution rates.

Within the Municipal Insurance Reform law (Chapter 69, Acts of 2011), our Association was able to secure language that has prohibited many cities and towns from increasing contribution rates on retirees and survivors over the past three years. The moratorium applies to any community that fully implements the provisions of Chapter 69.

Working with labor, the Association won the protection in the law over the objections of the Mass. Municipal Association. However, the freeze expires as of July 1, 2014 – in just six months!

“The idea here was to prevent cities and towns from balancing their budgets on the backs of retirees by increasing premiums, along with much higher copayments and deductibles,” says Association General Counsel Bill Rehrey. “We have a big concern that some communities will once again view retiree insurance premiums as a source of quick savings. This has not been a problem with state retirees, whose premium contribution percentages are grandfathered with their retirement date.”

“Whether we find relief for local retirees through H59 or our stand-alone bill (S1221, see page 9), we really need to find a way to protect our local retirees and survivors. It is blatantly unfair to expect retirees on fixed incomes to suddenly shoulder a larger burden when it comes to their healthcare costs,” says Association’s Shawn Duhamel. “We’ll be working with our friends in labor and the legislature over the coming months to find a way to avert this pending crisis.”