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LANSING UPDATE

From: Ellen Hoekstra
Legislative Update
January 20, 2010

Senate Republicans "Reform" Plan Targets Public Employees

In mid January, Senate Republicans issued what they term to be a reform plan. Among other things, it would mandate a 5% pay cut and 20% share of health premiums for all public employees unless they contribute to a Health Savings Account (HSA). Bills to implement the proposed health care changes have already been introduced as SB 1074 and SB 1075 and SJR P by Senator Mark Jansen (R-Grand Rapids) and Senator Jud Gilbert (R-Algonac). Although the legislation does not affect retirees, if it were enacted, it would obviously create a precedent for similar cost-sharing. The proposals also would require school districts to competitively bid custodial, transportation, and food support services.

To implement this plan, the Senate established a new seven-member panel, the Reforms and Restructuring Committee, to be chaired by Senate Majority Leader Mike Bishop (R-Rochester), with Senator Jud Gilbert (R-Algonac) as vice chair and Senator Minority Leader Mike Prusi (D-Ishpeming) as Minority Vice Chair. Other members include Senators Tom George (R-Texas Twp.), Wayne Kuipers (R-Holland), Deb Cherry (D-Burton) and Tupac Hunter (D-Detroit). For more details about these proposals, you can go to www.senate.michigan.gov/gop/reforms

House Legislation to Mandate Health Plans in Subcommittee Stage

Chairperson Pam Byrnes (D-Chelsea) appointed five subcommittees of the Public Employee Health Care Reform Committee, the special committee set up with the sole mission of reviewing HB 5345, introduced by House Speaker Andy Dillon. This legislation would require all public employee and retiree health plans to be selected from what is expected to be a small number approved by a newly created state panel.

Rep. Harold Haugh (D-Roseville) chairs the subcommittee that covers retiree health care. He chose to take his subcommittee to his district and created a panel of advisors that included legal, investment and labor expertise. His subcommittee met twice and will probably have one more session before issuing its report. When we learn the outcome of this subcommittee, we will let you know.

In the meantime, we would remind you again that right now, details of your health care are finalized by a 12 member panel on which nearly all of the members have a background in public education and two are retired school employees. By contrast, the 13 member board under HB 5345 would have only one school employee member and one retiree -- but the retiree could be a retired state employee, legislator, or local government retirant. Please let your state representative know that the current system works better for school retirees than would HB 5345, so they should vote NO on HB 5345!

Move Back to Dual Plan Apparently Smooth

The move back from the single "Medicare Advantage" plan appears to have happened fairly smoothly. Most members received their new Medicare cards prior to January 1, thanks to the good preparation of staff at the Office of Retirement Services (ORS). The vast majority of Medicare eligible members have elected to participate in "Living Well."

By: Ellen Hoekstra
Capitol Services, Inc.
January 20, 2010