By Dani Uribe
The need to cut costs has resulted in Gov. Rick Snyder signing a bill that will now require many public employees from schools and local governments to pay more of their health insurance than they did before. The final version of the bill was approved by the legislature last month, and Snyder signed it Sep. 24 before he left on a trip to Asia.
The legislation will limit how much a public employer can pay toward workers’ health coverage, which is going to raise the costs of insurance for some workers. The caps range from $5,500 for a single employee to $15,000 for a family.
Snyder said in a press release that the law was needed to bring a fair and equitable approach that brings public employee benefits more in line with the private sector.
Teachers and districts had already started agreeing to cost cutting decisions like paying more for insurance even before the law had passed. Some districts were able to get $100 per student restored if they would agree to follow a set of “best practices” including cutting insurance costs.
The bill will go into effect Jan. 1 of this year and the ultimate decision on the spending cap will be left up to the employers such as a city, county, or township. Employers can split up the costs between their employees, but if this option is chosen a public employer can’t pay more than 80% of the annual cost of medical benefits.