Almost every time we do a story about reforming Michigan government, viewers just like you email in questions about some of the perks of the job. Few perks are the focus of more concern and criticism than the so called lifetime health care benefits that our lawmakers currently get.
Viewer's asked "What do they cover? Who gets them? How much do they cost taxpayers? And what would it take to get rid of them?" The answers I found are the subject of this Fact Finder.
When you listen to Lansing it's not very common that you hear the same message from both sides of the political aisle. This is one of those uncommon times, especially when it comes to lawmaker's health care coverage.
Republican Representative Wayne Schmidt (R-Traverse City) has been pretty vocal about what he thinks should happen to the retirement perk, "I am in favor of removing that. I believe that you should have insurance while you are a legislator, but once you leave you are on your own." It's a message shared by Democrat Representative Dan Scripps (D-Leland) "The fact that this perk still exists in these difficult times says that's maybe the place where we start."
The effort has already started. Both Republicans and Democrats in Lansing have put forth bills (House Bill 4133 and House Bill 4194) that would eliminate or greatly reduce their fellow lawmaker's retirement health care coverage. Representative Schmidt says the two bills are quite similar in fact, "They are essentially the same thing. We put forth the bill last year to eliminate it (the retirement healthcare coverage); the Democrats saw the wisdom in it. They jumped on the bandwagon this year." Representative Scripps agrees, "I think it needs to happen. I think both parties have put a plan on the table. We are not that far apart, and the citizens are calling for us to tighten our belts before we look to cut programs that they rely on."
So what is the new plan? To understand the change you need to understand what lawmakers currently get. That's easier said than done so let's start with basics, while they are in office, all sitting lawmakers of the legislation get coverage for them and their families for the time they serve.
So what happens when they leave office? Follow me on this: if elected prior to 1995, lawmakers (regardless of their age) and their spouses can get taxpayer funded health coverage until their death. Their children are covered until they reach the age of 25. There are 380 current or former lawmakers who do or will qualify for this taxpayer supported health plan. But that number is not going to get any bigger because that program is no longer offered. It was eliminated as a cost cutting measure. Representative Schmidt explains "that went away in the mid 1990's. Nobody gets lifetime medical benefits anymore except for those remaining members."
So if a lawmaker was elected after 1995 they don't get the so called lifetime coverage like their predecessors, but they are eligible after 6 years in office for retirement coverage from age 55 to 65. Under this plan, Michigan legislators get 90 percent of their health insurance paid for. When they turn 65, they become eligible for Medicare, but also can still get state-paid benefits that cover expenses not paid by Medicare.
It's this coverage that is up for debate on the floor in Lansing right now. Both parties have pretty similar bills on the floor that call for the elimination of the 55-65 retirement health coverage. The bottom line of both bills is that lawmakers get coverage while they serve, and then lawmakers are on their own. Representative Scripps sees the modified benefit as reasonable, "lawmakers should get healthcare while are serving. Once they are done the expectation is that we can find jobs in the private sector. There are other opportunities out there, this is public service."
So if either of these bills becomes law and the 55 to 65 year old retirement coverage goes away, how much are we really talking about?
Representative Scripps figures "we could see savings of up to 5 million dollars a year which can pay for some things, it's not going to solve the budget problems overnight, but it could help educate our children and keep police officers on our streets." Representative Schmidt agrees "overall in a $43 billion budget it doesn't make much of an impact but we know that if everyone else is tightening their belts we are legislators need to do the same."
An update to this story: A bill did pass a vote in the State House, it now moves to the State Senate. While it passed the house 103-1 in favor, there is already an opposition to the measure being mounted. This bill calls for the retirement benefit to go away immediately with our current lawmakers. Opponents to the bill say it should start with the next round of lawmakers. Others I spoke with say that removing the retirement benefit will decrease the quality of candidate willing to serve in Lansing by making the job less desirable.
So what do you think? With both sides seemingly in agreement, do you think they will actually vote to eliminate the retirement coverage? Should they? Should it start immediately? I want your voice to be heard. I will be forwarding all of the comments submitted to our lawmakers. Please share your thoughts below. You can also take part in our poll on this subject.
