RETIREE HEALTHCARE REFORM BILL ON HOLD

Legislative Focus On Taxes & Transportation

APRIL 4, 2013: While concern over potential sweeping changes in retiree healthcare benefits grows amongst active employees, legislative action on Governor Patrick’s H59 now appears to be on a slow track.

Early this year Patrick filed H59, which closely mirrors the report filed by the Special Commission on Retiree Healthcare, which would make significant changes to eligibility standards and healthcare contributions of future retirees. The bill contains a July 1, 2013 implementation date, which led many observes, including our Association, to believe the proposal was on the legislative fast track for passage late this spring or in early summer.

But following the Governor’s filing of a transportation and education plan that would see $1.9 billion a year in new taxes, the focus on Beacon Hill has shifted to more immediate pressing matters. This past week, House Speaker Robert DeLeo and Senate President Therese Murray filed a joint House/Senate plan that raises $500 million in new tax revenue to be earmarked strictly for transportation needs.

That legislation is now before the House, where it will be hotly debated next week before moving to the Senate. The House is then expected to take up the FY14 Budget later this month, after releasing its budget draft on April 10.

“As we’ve said over the past few weeks, the focus right now is on the statewide issues of taxes, transportation and education funding. These are complex issues that have a very wide impact on not only our residents, but the overall state economy,” said Association President Ralph White. “Until these issues and the FY14 Budget are settled, the focus is going to remain on this core agenda and rightly so. With the future of the Commonwealth at stake, it is important that the right decisions be made.

“We’re at the beginning of a two-year session, so there is plenty of time to focus on healthcare and other issues of particular importance to public retirees.”

H59 is now before the Joint Committee on Public Service, which is chaired by Senator William Brownsberger and Representative Aaron Michlewitz. The Committee has not yet set its 2013 Public Hearing schedule; however, observers now believe that H59 will likely be heard in the early fall.

Public Service Committee members, like all rank and file legislators, have been inundated with calls, letters and emails from panicked active employees, who fear their health insurance benefits might be in jeopardy under the provisions of H59.

To be clear, all current retirees and survivors are exempt from H59 and will continue to receive full health insurance benefits. Also, most active employees close to retirement age are exempted as well (Click Here For More Information On Exemptions). The bill does change eligibility requirements and creates prorated insurance contributions for those active employees who are not exempt and all new hires.

“There is a valid concern among some active employees, who started in public service later in life and will have less than twenty years of service when and if this bill becomes law. No one should have the rug pulled out from under them and be denied insurance benefits,” explains Legislative Liaison Shawn Duhamel. “I can tell you that we are hearing from Legislators who agree that the reforms must be fair. They are going to take their time with H59 and make sure this reform is done the right way.

“We do encourage active employees to keep a close eye on the bill and continue to use our website as a resource for news. But there is no reason for anyone to panic and hastily retire at this time.”

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