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Your Tax Dollars at Work

Westford's Health Insurance Crisis

In his FY08 budget cover letter to members of the Westford Board of Selectmen and Finance Committee, town manager Steve Ledoux said, “The main challenge that the Town of Westford faces is that the growth in tax revenue under Proposition 2-1/2 does not even cover the increase in health insurance costs. This problem is not unique to Westford and we all realize the health insurance crisis is a national problem. Nonetheless, our estimate for growth under Proposition 2-1/2 for FY08 is $1,124,413. Our increase in health costs alone is $1.2 million.”

Certainly, the cost of health insurance is a national issue; however, in the private sector, employers have responded to skyrocketing costs by requiring employees to pay a greater share of premiums, accept higher deductibles, and make do with less generous plans. In the private sector, employees typically pay more and get less than their municipal-employee counterparts. This situation reflects economic reality. No business can survive if one of its major expenses increases 10 or 15 percent a year, every year.

While the same health-insurance-cost pressure is present in the public sector, the response by many municipal governments — including Westford — is not the same. Rather than taking aggressive steps to reduce or share the cost of health insurance, local government simply shrugs its shoulders and passes the cost on to you, the taxpayers. The excuse is always the same: health-care expenses are fixed costs, mandated by union contracts, over which government leaders have little control.

It's time to put an end to the shoulder shrugging. Some difficult decisions need to be made to control health-insurance costs for Westford's employees. There are no easy answers, but here are two suggestions:

Westford's leaders need to take a hard line on health-insurance expenses and insist that town employees share a greater part of the burden. This includes increasing the employee's share of the monthly premium and reducing the generosity of the plans currently offered. Westford's leaders also need to determine if the Town's insurance benefits are so generous that employees' spouses are opting to be covered by a Westford family plan rather than their own employer's insurance coverage.
Westford's leaders need to aggressively push to join the state's health insurance program known as the Group Insurance Commission (GIC). By joining GIC, Westford could save millions of dollars annually. GIC pays significantly less for high-quality health-insurance plans and offers substantially more diverse plans than most cities and towns can offer their employees and retirees.

If Westford joined the GIC, both the town's employees and taxpayers would benefit. Today, for example, a Town of Westford employee pays between $384 and $562 per month for family-plan health insurance. At the same time, a Commonwealth of Massachusetts employee pays between $133 and $295 for comparable family coverage. That means Westford employees could save between 48 and 65 percent of their insurance premiums if Westford joined GIC. And savings to Westford taxpayers would be comparable.

Westford taxpayers want their schools adequately funded. They expect reliable police and fire protection, usable roads, an up-to-date library, and a supportive senior center. But those services will not be sustainable — never mind improved or increased — if health insurance continues to consume almost 10 percent of Westford's budget.

Westford's taxpayers have finally figured out that the bulk of the money they send to Town Hall goes to benefit people whose wages and benefits are — in many cases — significantly better than their own. Someday soon, voters will wake up and start electing town officials who can balance the priorities of the taxpayer with the needs of municipal employees.