Behind The Sound Bite: Municipal Health Plans
Health insurance costs are a major lightning rod in Massachusetts municipalities these days. The latest to create a stir in this debate is a report from the Massachusetts Taxpayers Foundation that found that municipal health plans cost 37 percent more than similar plans at private companies. Bob Carey, author of the report, told the Boston Globe that, “The issue is cost-sharing, and right now the cost-sharing of municipal employees is minuscule.’’ In this edition of Behind the Sound Bite, we decided to dig into the 22-page report to unearth the facts behind the headlines.
What was the methodology of the study?
The researchers compared the most popular health insurance plans of 14 cities and towns with two state Group Insurance Commission plans, the federal government’s Federal Employees Health Benefits Plan for Massachusetts employees and Massachusetts private employer-sponsored plans. The private employer figures are based on a survey done by the Associated Industries of Massachusetts.
What were the average annual premium costs for municipal plans?
Individual annual premiums ranged from $9,696 for a PPO plan in Peabody to $5,758 for an HMO plan in Worcester. In contrast, the average HMO plan for private employers costs an individual $5,436. On average, municipalities pay 39 percent more for individual plans and 37 percent more for family plans.
How much of the premium cost do municipalities pick up for their employees?
Cities and towns picked up an average of 74 percent of individual premiums, compared to the 71-percent employer share for private companies.
What about deductibles?
Deductibles are notably absent from all 14 of the municipal plans studied. Private employers, on the other hand, had an average deductible for an HMO plan of $914 for individuals and $1,897 for family coverage.
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