Capitol Chaos -- Friday, Dec. 4, 2009

Dillon Health Care Plan – Prescription for Disaster

HB 5345 update: Further study needed

Reports from five legislative work groups investigating different aspects of House Bill 5345, the proposed mandatory state-run health plan for public employees, are due Dec. 31.

The work groups, which consist of lawmakers who sit on the House panel considering the legislation, were created to “speed this process along,” Rep. Pam Byrnes, committee chair, told attendees of a Dec. 3 hearing on the bill.

The work groups are assigned to look at: administrative cost efficiencies; prescription drug purchasing; plan elements and op-out provisions; board composition and appointment; and retiree health care.

In other news from the Dec. 3 meeting of the House Public Employee Health Care Reform Committee:

·         It’s become apparent that some lawmakers, including Byrnes, lack important data – including health plan costs and information about how many employees receive health insurance benefits. At the hearing, they said they want public employers – and the unions that represent them – to provide more specific data and analysis.

·         Said Byrnes of the lack of information about health plan costs: “It’s very hard to critique something without having figures in front of us.”

·         Two lawyers, including one hired by the House of Representatives, testified that the bill does not violate the state Constitution as it relates to classified state employees or university workers. Gary Gordan, who works for the Dykema law firm, advised lawmakers to not prescribe limits to coverage or very specific benefits because that would be harder to defend. He suggested the state could offer a range of benefits and, by doing so, avoid any Constitutional challenges.

·         Howard Bunsis an accounting professor at Eastern Michigan University, questioned alleged savings of a state-run plan. Collective bargaining has led to cost savings at Eastern, he said, where faculty pay 15 percent of the cost of their health insurance. Any savings that result from a mandatory state plan, he said, will come from “more out of pocket costs for our members and less benefits.”

·         Adam Miller, who negotiates benefits for UAW members, said “this plan needs to be brought down to earth.” He said the proposal aims to squeeze cost savings out of public employees and doesn’t similarly hurt insurers, providers, or public employers. He also questioned why the legislation allows an opt-out when the bill is based on a premise that larger pools reduce costs.  Allowing public employers to opt out of the state plan if they can find a cheaper one will lead to cherry picking by insurers, Miller said.

The committee meets again Thursday, Dec. 10.

News of the Day

Education reform bills racing to the top of legislative agenda

Teacher tenure bill latest to pass Senate

After the Senate suspended its own rules to take a third vote and after much struggle, majority Republicans in the Senate were able to get the minimum 20 votes needed to pass SB 638. That means teacher effectiveness could become a factor in tenure hearings to determine whether a teacher is demoted or fired.

SB 638 is the latest education reform bill to pass the Senate in the Legislature’s attempt to put Michigan in the running for $400 million in “Race to the Top: money. States are required to enact major education reforms to receive the money.

Senate Education Chair Wayne Kuipers (R-Holland) said the tenure bill is a key piece of school reform. “It’s very difficult to get rid of a teacher. You ought to have a criteria that you use to determine whether a teacher is effective and if they don’t measure up to the criteria, the teacher is released.”

Democrats dispute that “Race to the Top” requires changes to tenure.

Education Reform Highlights

In addition to the teacher tenure bill, the follow education reform bills have passed the Senate:

• Failing schools – Districts with at least 25 percent of their students in the lowest achieving 5 percent of buildings in the state would be run by a CEO appointed by the state superintendent. For the bottom 5 percent only, the superintendent could take a series of steps, including appointing a building administrator.
• Charter schools – Current management companies or top administrators who operate charter schools with the highest rating under Michigan’s accreditation system in the preceding three years could be eligible to open new charter schools.
• Teacher accreditation – Anyone interested in teaching could obtain interim accreditation for three years. They must have a 2.75 grade point average while getting a bachelor’s degree and receive 12 hours of training in selected fields.
• Administrator certification – Newly hired superintendents and other administrators would need to follow a process for certification.

On the Horizon

While lawmakers work on education reforms pertaining to charter schools and teacher accreditation, the talk of changing the state law requiring schools to start after Labor Day has begun. The law was changed just a few years ago to help the tourism industry and the idea of turning back does not appeal to tourism lobbies.

House Education Committee Chair Rep. Tim Melton (D-Auburn Hills), sponsor of HB 5623, believes that the state has to give locals the flexibility to provide more instructional hours to compete for “Race to the Top” funds. According to Melton, eliminating the Labor Day start accomplishes that.

In other legislation, House Minority Floor Leader Dave Hildenbrand (R-Lowell) and Rep. David Agema (R-Grandville) introduced legislation requiring all public employees to pay 15 percent

of their health care premium. Hildebrand said, “This is a step to ensure that the public sector reflects what is going on in the private sector.”