The future is here

From The Beacon, April 2011

For several years, municipal leaders have been up front and clear on the need to provide cities and towns with the tools and authority to control health insurance costs for municipal employees and retirees. Communities have demonstrated that local taxpayer costs were skyrocketing because localities were locked into plans that were no longer affordable, and noted that state government was controlling its own costs by increasing co-pays and deductibles on a routine basis, steps that municipal managers could not take under state law without first receiving approval from local unions.

In recent years, efforts to advance municipal health insurance reform have stalled on Beacon Hill, but the issue clearly has new momentum and the full attention of legislators and the governor. House Speaker Robert DeLeo has declared his strong support for meaningful reform and announced that the House would be acting within the next month, a major boost to the issue.

The sense of urgency is tangible in city and town halls, and it has spread to the State House. We certainly hope that the resulting reform legislation is powerful, flexible and meaningful, and that it gives communities the full authority they need. Without strong and workable legislation, communities and local taxpayers will continue to pay too much for health benefits, and too little on basic services.

Part of the impetus to act now is a result of the multi-year budget crisis caused by the Great Recession of 2008-2009. With declining state taxes, local aid cutbacks, and shrinking federal aid, there is no source of revenue to gloss over the mathematical mismatch between costs and affordability. There is a reason why our state and federal governments and private employers have increased the co-pays and deductibles in their health plans: the old plan designs became too expensive to sustain.

At the local level, communities have to wait until state law is amended to give them the same power to act. Facing a fourth consecutive year of local aid reductions, legislators are under great pressure to provide relief in key cost centers.

One of the great challenges of the American system of government is speed. The entire structure is based on a system of checks and balances that makes it very difficult to pass a law, and very easy to kill a proposal. This has been the genius of the Founding Fathers. With divided power, three branches of government, and an endless number of opinions, the system is designed to force consensus and require a critical mass of support in order to take action. The government is stable and rarely lurches from extreme to extreme.

The major benefit is that the issues are usually vetted for years leading up to the moment of passage, with all stakeholders engaged. But no system is perfect. The major drawbacks are that action is usually delayed until it’s almost too late, or it is too late, and the resulting compromise frequently addresses only a portion of the problem. Opponents of legislation can easily use the checks and balances that are the hallmark of our system to seek delays and drag issues out for years, even if that makes matters worse in the long run.

Well, cities and towns have been calling for action for years. Opponents can no longer say that this is an issue that can wait for some future day. That day has come. Indeed, we are late; communities could have saved as much as $100 million a year and avoided countless layoffs in the past several years if plan design reform had been enacted earlier.

This is a cautionary tale for all of us. There are many big issues confronting government at all levels: the massive deficit facing the federal government, skyrocketing Medicaid costs confronting every state government, and unsustainable pension and retirement systems at the municipal level. Many people will say that these are issues for the future, yet the longer we wait to address these vital matters, the harder the choices will be, and the chances are much greater that we will place a heavier-than-necessary burden on younger families and yet-unborn generations. In other words, the future is here.

As we work to pass strong and effective municipal health insurance reform today, we cannot afford to put off the rest of the big issues to another day.