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Get the torches and pitchforks!

OK, this issue gets me mad enough to riot in the street.  I read Runaway health costs are rocking municipal budgets in today's Boston Globe.  If you live in Massachusetts, you have to read this article.  It describes how our municipal employees are getting extraordinary health care benefits.  Many employees get lifetime health care for themselves and their families after working as few as six years.  Some towns don't force their retirees onto Medicare at age 65, carrying their health care costs on town books instead.

The combination of longer lifespans, skyrocketing health care costs, and these generous benefits are driving up the share of municipal budgets that are taken up with health care.  The average town surveyed by the Globe has had their health care costs grow from 8% of the budget to 14% in the past decade.

Now, anyone running a business or buying their own health insurance knows that costs have gone up.  You can't blame the cities and towns of Massachusetts for the overall rising costs of health care.  But, municipalities in Massachusetts are constrained in increasing property taxes under Proposition 2 1/2.  Cities and towns have had to learn how to live with constrained budgets which is, overall, a good thing.  However, one thing that hasn't been wrung from budgets are overaly generous health care benefits.  These health benefits are forcing cities and towns to cut essential services like police, fire, and education.

I can see the point of having generous health care benefits for municipal employees during employment.  These jobs are generally not high-paying positions.  Generous health care benefits can be a nice perk.  I can even understand why someone should have some continuation of benefits as part of a severance package if they leave under certain circumstances.  But, these should be limited and in line with the time of service.  A very long serving employee who is let go through no fault of their own deserves some severance.  But, not for life!

And, what's the justification for continuing to cover retirees on the municipalities books beyond age 65?  That's what Medicare is for, and we all pay for it already.  Instead, these retirees are getting gold-plated benefits at the expense of hiring other employees like teachers.

Even worse, some towns have huge unfunded liabilities for health care.  The total for Boston is $5.7B!  How do they fix problems of this size without raising taxes (very limited opportunity for this under Proposition 2 1/2) or continuing to cut essential services like police, fire, education, libraries, trash collection, etc.

The worst example: The widow of a Lynn police officer who retired on disability in his 30s in 1953 is still receiving city-subsidized insurance - 57 years later.  This police officer couldn't have had more than about 15 years of service.  But, his widow gets health insurance for 57 years!  Wow!

What to do about it:

  • Pass a new state law that limits retirement benefits for municipal workers to something proportional to time served.
  • Other than severance benefits proportional to time served, no continuing health care benefits should be allowed for municipal employees who leave their job before retirement age.
  • Require municipal retirees to go on Medicare at age 65.
  • Void all elements of current collective bargaining agreements that contravene these measures.

This might be seen as draconian by some, but the State has an interest in regulating this.  First of all, the State provides local aid to cities and towns.  That money will get consumed by overly generous health care benefits unless regulations like these are in place.  Second, the State will end up bailing out cities or towns that go broke under the yoke of these benefits.  Therefore, they have an interest in cutting this waste.  And, third, it may take forever for each city and town to wrestle with these issues on their own.

I'm going to send a note to the Governor's office and to my state senator and representative about this.  Find out who yours are here.  I'm also going to find out how much my town, Bedford, is paying for these types of benefits and whether we require retirees to go on Medicare at 65.  I urge you all to do the same.

Thank goodness the Boston Globe is still in business.  Who else is going to do this type of local investigative reporting?

This one is worth rioting in the streets over!


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