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McClaughry: Teacher Healthcare Impasse

Governor Scott and Democratic legislative leaders are at loggerheads over realizing $75 million in savings from switching the state’s teachers to a health insurance plan compliant with the Affordable Care Act, also known as ObamaCare.

Practically everyone involved sees a real benefit in the switchover. The teachers would pay 20% of lower premiums for generous Gold-level plans, and be held harmless for those plans’ higher deductibles. After these expenses, the switchover would make up to $26 million dollars available for school property tax relief.

Here’s the rub. The governor wants to negotiate with the teachers union to bring about the new program, although the state is not their employer. The union is utterly devoted to bargaining only with local school districts, a practice they call “sacrosanct”.

The governor has promised to veto the appropriations bill, about which there is no disagreement in the legislature, unless it accepts his proposal. The Democratic leaders have stood firmly against any removal of health insurance from union negotiations with local districts.

There is a way out of this impasse. Scott needs to drop his late in the game proposal to have the State negotiate with the union. Then the legislature should enact a law that makes teacher health insurance a state-specified benefit like pensions, defines the coverage, the Health Savings accounts, and the 80/20 premium split. This leaves untouched the union’s statutory privilege to bargain with local districts over salary schedules, grievance procedures, and a dozen more issues customarily subject to bargaining.

In 2013 the teachers union supported a law imposing agency fees on non-members, instead of leaving that as an issue for local bargaining. One would think the union would agree to get the complicated issue of health insurance off the local bargaining table as well. But it won’t.

The union’s passion for local control stems from its bargaining strategy to get a favorable provision into one district’s contract, and then use that to persuade “fact finders” to rule in favor of the union’s demand in other more resistant districts.

Democratic legislators need to tell the union that Scott’s desired outcome offers many benefits for both teachers and taxpayers. But to achieve them, Democrats should explain that they aren’t going to impose impractical and belittling conditions on local school districts just to preserve the union’s bargaining strategy on health benefits. The question is, can they summon the independence to do it?

John McClaughry is founder and vice president of the Ethan Allen Institute, a Vermont policy research and education organization.
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