The GIC & MA Cities & Towns, Part III
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Pretty interesting article in my local paper recently. Turns out that the bid the town of Swampscott got from BC/BS of MA and the Mass. Municipal Association through the so-called MIIA Trust was the lowest in years. Maybe decades. In fact, the proposed increase in health insurance premiums for the town of Swampscott through MIIA in FY 2009 (starting in July, 2008) was…ZERO. That’s right — the big goose egg. That, of course, is really good news for my hometown — which can use all the financial help it can get these days.
Now here’s the rub. Swampscott was one of a handful of towns in Massachusetts last fall to pursue the coalition bargaining option for enrolling in the state of Massachusetts’ Group Insurance Commission (GIC) made available under a new state law last spring. For a time, it appeared the town would, in fact, convert the GIC for FY 2009 — because the savings were huge. In the end, the local labor unions wouldn’t agree to do it, arguing they didn’t have enough time to study all the ramifications of moving.
Some towns, though, did move — including a couple that have the same small-town obstacles to staying in the health insurance game on their own that affect places like Swampscott.
So why did Swampscott get a zero percent increase? Maybe they deserved it. But just maybe the mere presence of the GIC as a viable alternative gave them an option they hadn’t had before — and pressured MIIA to sharpen its pencil and come in with a “best offer.” Wouldn’t it be ironic if the mere availability of the GIC option was enough to create the kind of competitive pressure at the city and town level that hadn’t been there before — thereby saving towns money without requiring them to move?
As a fellow Swampscott resident, I was carefully watching the evolution of the town’s decision on its workers’ health care future. Good to see that a fellow resident with a stake in health care far greater than mine is vigilant about the town’s costs in this area as well. Certainly competition breeds the best deals and, being on GIC through my wife, I thought that would be a fairly good plan to select. Looks like the town’s fathers (and mothers) had a bit more on the ball then me. Now if they can just figure out how to maintain the school system quality without cost overruns, we’d nominate them for sainthood…or at least the local government of the year.
Bosstown - Thanks for signing on from my hometown. While I think it’s great the town’s getting a zero percent increase from MIIA for FY 2009, we should all remember that the town would have saved $1 MM if it had moved to the GIC. While the end result here is probably a good one, all things considered, small towns like Swampscott are still better off joining the big risk pool made available by the 200,000+ people covered by the GIC. And yes, the GIC has a terrific set of offerings. The notion that this choice would somehow be a step down for anyone is hard for me to believe.
As Johnny Carson used to say, “I did not know that!!!” Thank you for adding that tiny (??) point…of a mil!!