Ward 5 Councilman Ed Ladouceur was in his business office Saturday morning with papers spread in front of him. Sheets were sorted by group of retirees whose names were followed by a designated pension plan – whether police, fire or municipal employee – and the amounts they are paid semi-monthly.
“This thing is far overdue,” Ladouceur said of legislation he and Council President Steve Merolla have been working on for months to rein in health care costs.
While active police, active fire and municipal employees co-pay for their health care, retirees don’t. Of the hundreds of retirees listed, many receive twice-monthly pension payments of $2,500 or more. One is for $5,019, or more than $120,000 annually.
“He’s the highest I’ve seen so far,” Ladouceur says of the retired fire chief John Chartier.
Ladoceur and Merolla were prepared to bring forward amendments to city ordinances last night that would establish minimum deductibles of $500 for an individual and $1,000 for a family health plans for municipal employees among a list of co-pay minimums. In addition, there would be thresholds based on salary where co-payment increased with pay. Employees making $53,498 or less would have a 20 percent co-pay. The next step up to $102,840 would co-pay a minimum of 25 percent, and those over that amount would be faced with a minimum 30 percent co-pay.
Similarly, there would be a threshold for health care co-payments for retirees starting with those receiving $30,000 a year or more, who would pay a minimum of 25 percent of their health care.
Ladouceur said for years, elected officials traded health care benefits for lower salary increases when negotiating contracts. Since then, health costs have gone up exponentially, with expenses relating to active employees and retirees taking up a larger and larger chunk of the operating budget – thereby pressuring the taxpayer while reducing the city’s ability to address failing infrastructure.
Merolla and Ladouceur estimate the amendments they propose could save the city $5 million annually.
Word of the ordinance spread quickly on social media, and by Friday, Michael Correiro, president of the Warwick Firefighters, issued a notice to members and retirees to turn out to last night’s council meeting. Correiro argues benefits are a matter of the contract and negotiable.
“This is not a union issue,” Carriero said Sunday. “This is an employee issue. They’re taking away benefits.”
Merolla maintains the council has the power to establish minimums by law, and what he hopes for the city to do is no different than what guides state employee contracts.
Ladouceur said the firefighters or any other group have the right to show up at the council meeting. He expects pushback. He just thinks something should have been done sooner.
“We’re going to begin the debate that we should have had years ago,” he said.
“If [you] want health care, [you’re] going to have to pay your share because it’s no longer affordable,” he added.
Carriero acknowledges that health care costs have soared since they were included in contracts many years ago, so shouldn’t retirees take on some of that cost?
“This is not the proper way to do it,” Carriero said.
And what is the proper way?
“We just negotiated a proper way to do it,” he said of the tentative agreement.
Until now, elected officials have refrained from addressing health care co-payments for retirees on the premise it was a benefit won at the bargaining table. Even the tentative agreement between firefighters and the administration, which is expected to come before the council on Dec. 16, does not contain language requiring future retirees to co-pay for health care.
Merolla reasons the council has the authority to legislatively set minimums that do not handcuff the administration and unions from negotiating an agreement while protecting the taxpayer from unforeseen increasing costs.
“There’s nothing that says you can’t [set minimums],” Ladouceur said. He said controls are needed as city health care costs, exclusive of schools, are now at $23 million annually and only going up.
“They [active and retired employees] realize at some point in time this can’t be paid for.”
Also, he reasons that active employees should realize this is in their interest because, “if we don’t fix this thing they’re going to pay a lot.”
“This is my responsibility to bring affordable health care to [city] employees and those who pay the bills – the taxpayer,” he said.
The two councilmen also think the $300 cap for individuals and $600 for families, after which employees as well as retirees don’t have to pay for their prescription medications, should be lifted.