LANSING – It will still take concurrence from the Michigan Senate, but the House on Thursday signed off on a change to public employee health care cost sharing that would provide the options of both a hard dollar cap and 80/20 split.

But the chamber failed to win the two-thirds support required on SJR C , which would make those provisions apply to state civil service and public university employees.

Under SB 7 , which passed 56-52, the hard cap would come first and would be maintained at the $15,000 level for family coverage, $12,500 for an individual with children, $11,000 for an individual with a spouse and $5,500 for an individual. Employees would have to pay any premiums above those levels.

But if employers wanted to do the 80/20 cost sharing plan, where the employer would pay no more than 80 percent of their employees’ health insurance costs, they could vote to opt out of the dollar cap and into the 80/20 plan. That would take a two-thirds vote of the local governing body. But in a community where the mayor is both the chief administrator and chief executive, that person would also have to approve the change.

Only municipal and county governments, not schools, could opt out of either plan without penalty as long as the two-thirds threshold is met. School districts that simply don’t institute the cost-sharing measures would be docked 10 percent of their school aid payments.

The requirements would begin in January 2012 or after a collective bargaining agreement in place prior to the law expires.

Rep. Tom McMillin (R-Rochester Hills) said the bill now gives local governments the flexibility to reign in their health care costs.

“We certainly don’t want people falling into (emergency management),” he said. “We’re giving them the tools to manage their budget. All the other citizens and taxpayers have had to rein in their spending and tighten their belts.”

House Speaker Jase Bolger (R-Marshall) said, “With Senate Bill 7, we are ensuring that legislators, public employees and teachers can have quality health insurance policies while protecting their employers – the taxpayers of Michigan. The public should not be responsible for providing benefits that often are far greater than what they have available.”

But Rep. Lisa Brown (D-West Bloomfield) said the bill actually limits the options for local governments because it bans them from multiyear health care contracts and doesn’t address voluntary employee benefit associations (VEBAs) some governments have created with their employees.

Brown offered an amendment that would have let every public entity covered under the bill to opt out, but Republicans procedurally blocked that measure.

“Time and time again we heard the problems with a one-size-fits-all (solution),” said Rep. Timothy Bledsoe (D-Grosse Pointe). “This is a two-sizes-fits-all, but it’s not much of an improvement.”

Only one Democrat, Rep. Tim Melton (D-Auburn Hills), voted for the bill, but six Republicans split with their party to oppose it: Rep. Frank Foster (R-Pellston), Rep. Ken Goike (R-Ray Township), Rep. Ed McBroom (R-Vulcan), Rep. Margaret O’Brien (R-Portage), Rep. Peter Pettalia (R-Presque Isle) and Rep. Sharon Tyler (R-Niles).

Along with Senate concurrence on SB 7, which at the earliest would occur on July 13, the House failed to approve SJR C.

Rep. Mark Meadows (D-East Lansing) said that measure would override more than a hundred years of autonomy for public universities, the civil service and collective bargaining rights for State Police.

The constitutional amendment failed on a 61-47 vote with two Republicans absent. House Majority Floor Leader Jim Stamas (R-Midland) moved to reconsider the vote and then postponed the item for the day.

This story was provided by Gongwer News Service. To subscribe, click on Gongwer.Com

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