On June 26, 2018, the city of New York and the Municipal Labor Committee reached an agreement on a plan to save approximately $1.1 billion in employee health care costs over the next three years.
In response, UFT President Michael Mulgrew issued the following statement:
Working with the city, we managed to come up with a health care deal that will provide excellent services while reducing overall costs, and at the same time ensuring that our members will not be paying additional premiums.
- The Municipal Labor Committee (MLC) and the City of New York reached agreement on a plan to save approximately $1.1billion in employee health care costs over the next three years.
- The agreement includes increased reliance on services in free-standing health centers or office settings rather than hospitals, but does not entail additional contributions by city workers to their health care premiums.
- The new plan will provide incentives for workers to rely on health centers and doctor’s offices for procedures like arthroscopy, colonoscopy, cataract removal, radiology and ambulatory surgery. Among the other sources of savings will be the assumption of a lower rate of growth in city spending on health. New services will include a new fertility support program and wellness initiatives designed to better manage chronic conditions like asthma and diabetes. Prices on some drugs will also be reduced.
- As part of the agreement, all new employees hired after July 1, 2019, will be automatically enrolled in Health Insurance Plan (HIP). After one year, they can choose another plan.
- The citywide agreement is separate from contract negotiations around wages and working conditions for each of the MLC individual unions,. However, it provides additional resources the city can use for the next round of contract settlements.
- In April 2014 the de Blasio administration announced that it had reached a deal with the Municipal Labor Committee on a similar series of steps designed to reduce health care costs.
- The savings were designed to come from: audits to reduce spending on ineligible patients; reductions in the amount the city was projected to pay into a fund created to bridge the differences in cost between the major insurance plans; smaller annual increases than originally projected in the cost of health insurance for employees; and encouraging workers to visit outpatient centers rather than emergency rooms.
- In March 2018 the city announced that the savings plan was on track to reach its goal of $3.4 billion in savings in four years. The Municipal Labor Committee consists of representatives of nearly 100 unions of city workers. The Committee negotiates for all the unions on citywide issues like health care.