Barre meets with unions on cost cuts
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Dave Krupa of Blue Cross and Blue Shield of Vermont explains changes to health care costs to Barre City employees Monday during a special council meeting in Barre's Alumni Hall. Stefan Hard/Times Argus |
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By David Delcore Times Argus Staff - Published: November 18, 2008
BARRE – Roughly two dozen city employees – including members of all four municipal labor unions – were told Monday night that the ax will fall if officials can't come up with a way to corral the spiraling cost of health insurance in the next 30 days.
Faced with what would be an unprecedented 34 percent increase in insurance premiums for Barre's 92 municipal employees, City Manager John Craig told those gathered in the second floor meeting room of Alumni Hall that there are difficult choices ahead and – if necessary – he is prepared to make them.
However, Craig stressed he would much prefer a meeting of the minds that would blunt the anticipated $375,000 increase recently quoted by Blue Cross Blue Shield of Vermont, saving jobs and still providing city employees with better-than-average benefits.
"I want to work with you employees," Craig said. "I'd like to come up with something that is not as catastrophic as, 'we're cutting this department and eliminating these positions.'"
That said, Craig freely acknowledged the city is contractually obligated to three of four local labor unions and if necessary will have find the money needed to fund the premium increases Blue Cross quoted for the two high-end plans specified in each of the contracts.
"That money will be from employees. It will be from reductions in staff," he warned. "I don't know any other way to do it … That's not a threat, that's just a reality."
According to Craig, the cost of employee health insurance currently accounts for nearly 12 percent of the city budget. That figure would jump to almost 17 percent based on the latest Blue Cross quotes, which – barring a change in plans, providers, or both – will go into effect Jan. 1.
With that deadline looming, Mayor Thomas Lauzon called Monday's special session – a two-hour question-and-answer period that was followed by a 30 minute closed-door meeting with employees and one union representative.
Following the private portion of the meeting Lauzon said he remained hopeful that his goals could be achieved in the condensed time frame the city has to make a decision on the health insurance front. Lauzon said his objectives did not include a 34 percent increase in insurance premiums.
"I want a number that's sustainable for the city. I want good benefits for our employees and I want to keep everyone employed," he said. "Absent some adjustment I don't see that happening."
Lauzon invited employees to participate on the "front-end" of discussions by designating representatives to a committee that he has proposed. That committee, he said, will weigh alternatives ranging from enrolling in a more affordable plan offered under the Blue Cross umbrella or rejoining the Vermont League of Cities and Towns Health Trust, which dropped Blue Cross for Cigna two years ago.
Employees who attended the session said they were willing to consider alternatives without sacrificing the benefits they bargained for in good faith.
"It makes sense to try and come up with something that's win-win if possible," said George Lovell, a union representative for the American Federation of State, County and Municipal Employees.
However, Lovell, whose union represents employees of the city's police and public works departments, said any discussions that occur in coming weeks should not be misconstrued as a willingness to renegotiate existing contracts. What's more, he said, employees were keenly interested in maintaining quality insurance.
"We're certainly interested in looking at alternatives, but we're not interested in jumping on board a race to the bottom in terms of health care," he said.
It was Lovell, who eventually suggested that Monday's meeting be closed to the public and that subsequent discussions on the subject – including a 6 p.m. meeting next Monday – occur in private.
Lauzon said whatever it took to bring all the parties to the table quickly, given the short time frame the city is working under, was fine with him.
"If you want to close the meetings, we close the meetings," he said. "I'm willing to be as accommodating as possible."
During the open portion of Monday's meeting employees were told by officials from Blue Cross that the sharp spike in the city's projected annual premium was largely a function of the high-end plans that it offers and abnormally high usage the city has experienced of late.
"It's not a story that the consumer likes to hear, but you do have a very rich plan," said David Krupa of Blue Cross.
According to Krupa, that may help explain why Barre's municipal employees were roughly twice as likely to seek inpatient care as other Blue Cross customers last year and the numbers seeking outpatient care were also "substantially higher" in Barre.
"If you have a zero co-pay there is no reason for you to think twice about going to the doctor as opposed to using the (Blue Cross' 24-hour) 'nurse line,'" he said.
That said, employees were told that only a handful of them were responsible for approximately 40 percent of the claims last year.
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