1-year union pacts the key to health-care reform?
The one-year contract agreement announced yesterday between the city and the Fraternal Order of Police signals that Mayor Nutter has set his sights on a goal that other mayors have failed to accomplish: Reforming health care for all four municipal unions.
The one-year contract agreement announced yesterday between the city and the Fraternal Order of Police signals that Mayor Nutter has set his sights on a goal that other mayors have failed to accomplish: Reforming health care for all four municipal unions.
Nutter said yesterday that the yearlong, $9.3 million agreement brokered by an arbitration panel would give him the "time that is needed to fully focus on the most critical issues that drive the two biggest budget factors in our city, health care and pensions."
According to Nutter, benefits for city workers cost $850 million annually - about 22 percent of the city's budget. That's up from $370 million 10 years ago.
"We cannot continue down the same path without serious changes," Nutter said.
In addition to giving cops a 3.5 percent raise and reducing health-care costs by 10 percent, the contract will set up a health-care evaluation committee with representation from the FOP and the city.
Nutter said that the committee, which he predicted will meet through the summer and into the fall, must be "open to rethinking the entire benefit-funding and -delivery system."
Nutter ducked questions on whether he was seeking time to develop a proposal to consolidate the four union health-care plans into one city-run system. Each union now runs its own plan, funded by monthly contributions from the city.
During his tenure as mayor, Gov. Rendell tried to consolidate the health plans in his first union negotiations. So did former Mayor John Street. Both failed.
Nutter said that he wanted the other three unions to join the health-care committee. He would not say if he was seeking one-year deals from them also.
Union leaders were mum yesterday on whether they would join the committee or consider a one-year contract.
District Council 33, which represents blue-collar workers, and white collar union District Council 47 are still negotiating with the city. The Fire Fighters Union has not yet begun the arbitration process.
Fraternal Order of Police President John McNesby said that the union would accept the deal, although police had asked for a three-year contract.
"We would have loved to have longer than a one-year deal, but the fact of the matter is, it puts money in the cops' pockets . . . our health care remains intact," McNesby said.
McNesby said that they would participate in the committee, but he questioned the idea of a merged benefit plan.
"I don't think so," he said. "We're used to the level of benefits we have, we're able to administer them with the sharpest pencil in town."
The contract decreases the amount paid per capita for health benefits - down to $1,165 from $1,303 a person. Nutter said that the city will save $13.4 million as a result.
McNesby said that this would not affect the level of benefits because the FOP had already been operating with less than $1,303 a person, and were putting the difference in a reserve fund.
The city will also pay $500,000 to the union for its legal expenses. The union had questioned a one-year deal because of the expense of starting new negotiations in six months, officials said. *
