Should Unions Have The Right To Refuse Health Insurance Plan Changes?

Over the past decade, the cost of health insurance has soared across the board. For cities and towns, the expenses are especially crushing. According to a statistic from the Massachusetts Municipal Association, health care costs have risen over 150 percent for municipalities over the past decade.

Towns and cities want the power to reduce these costs. Currently, many states have laws that require collective bargaining agreements when potential changes in benefits are proposed. Therefore, public employees have been largely exempt from cost-cutting trends that pass more of the health care costs onto the consumer. By contrast, they have no deductibles or co-payments for major medical procedures. Meanwhile, in some states, their office visits cost only five dollars.

Due to the recession, cities and towns across the country have been forced to cut back. One of the most obvious areas for cost cutting is in their benefit packages. However, labor unions have the right to veto any potential changes–and they have typically taken advantage of their veto power. Most of the time, the unions refuse any proposed changes.

For their part, the municipal unions argue that the generous health benefits are part of their agreement. Historically, government workers have agreed to receive lower salaries than they could get as private sector employees–in exchange for a more comprehensive health insurance plan with lower out-of-pocket costs. When health care costs were relatively lower, this was a good deal for municipal governments. However, the situation has changed over the past several years.

Meanwhile, municipalities are forced to cut back in other areas. In order to eliminate budget shortfalls, they have to lay off employees and cut essential services. Layoffs hurt the economy in the long run. At the same time, taxpayers must pay more when they can ill afford to do so.

What can be done? In Massachusetts, state employees have exempted themselves from the collective bargaining mandate.

Yamileth Medina is an up and coming expert on Health Insurance and Healthcare Reform. She aims to help people realize that they can find a quality health insurance plan right now. Yamileth lives in Miami, FL.

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