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Member, Beacon International Group, Ltd.
LANSING, Mich.—Michigan lawmakers have given final approval to legislation to cap how much public employers in the state will pay for health care plans covering their employees.
Under the measure, S.B. 7, health care premium contributions by public employers, such as local governments and school districts, would be capped at $5,500 for single coverage, $11,000 for individual and family coverage, and $15,000 for family coverage.
This cap would go into effect on Jan. 1, 2012, and be adjusted annually by the state treasurer to reflect changes in the medical care component in the Consumer Price Index. Alternatively, public employers could take an approach under which employees would be required to pay 20% of the health insurance premium, the same percentage that employees hired on or after April 1, 2010, are required to pay. Those hired before then pay 10% of the premium. Michigan Gov. Rick Snyder is expected to sign the bill. Effort to reduce costs The Wednesday move by Michigan lawmakers to make employees pay more for health care coverage is part of a broader drive by public entities—economically stressed as the recession has held down tax revenues—to try to reduce benefit costs. For example, New Jersey lawmakers earlier this year approved legislation boosting public employees’ pension and health care premiums, while the Atlanta City Council approved a measure increasing pension plan contributions for many city employees.