Dillon: Overhaul public sector health plan

LANSING, Mich. – House Speaker Andy Dillon has proposed a single health care plan for all public workers and retirees that he says could save up to $900 million a year through standardized coverage and economies of scale, according to several media reports. The Michigan Education Association, the state’s largest teachers union, immediately rejected the idea, the reports said.

Dillon, D-Redford Township, said that government, university and school employees in Michigan generally receive benefits exceeding those of public employees in other states as well as private sector workers, the Associated Press reported. Aligning Michigan benefits with those of other workers could help prevent government and school employee layoffs, Dillon said, according to the AP.

The MEA questioned the state’s ability to manage a statewide program, according to the Lansing State Journal, and said many teachers already have given up pay raises in order to maintain health benefits.

The Journal reported that under the plan, unions representing public employees would negotiate a single health plan with the state.

Other Democrats and the Office of Gov. Jennifer Granholm said they were still reviewing the proposal, which has not yet been introduced as legislation, the reports said.

Granholm spokeswoman Liz Boyd said in a statement that "theoretical savings" of any proposal should not "prevent us from making tough choices about spending and revenues in our budget,” the AP reported.

Dillon said that, given the state’s $1.7 billion overspending crisis, he will be introducing several plans to reform state government, according to a Gongwer News report.

Associated Press, “Mich. Dem. wants overhaul of employees’ healthcare,” July 15, 2009

Lansing State Journal, “Proposal: One health plan for public employees,” July 16, 2009

Gongwer News (subscription required), “Dillon calls for single public sector health care program,” July 16, 2009

Mackinac Center for Public Policy, “Diminishing Private Sector Keeps Supporting Bloated Public Employee Benefits,” July 7, 2009