The graded scale premium concept for retiree health care is moving through the legislature.  It means that employees hired after June 30, 2007, will pay a larger portion of the insurance premium for their retiree health care unless they have at least 30 years of service credit. 

This plan, SB 546-7, has passed the Michigan Senate on a largely party-line vote, with the exception being the “no” vote cast by Sen.Roger Kahn (R-Saginaw).  The House version, HB 4797 and 4798, is being worked on right now.  Members are urged to write or e-mail their State Representatives in opposition to House Bills 4797 & 4798. These bills will produce no savings to school districts for at least 20 years. They will, however, significantly effect future retirees.

Dear [ Decision Maker ] ,

As a member of AFT Michigan, I am strongly opposed to House Bills 4797 & 4798, the "graded scale premium" legislation. Touted as a cost saver, this bill will produce no savings to school districts for at least 20 years when yet to be hired school employees retire.

Graded scale premium means that unless a school employee works full time for 30 years, their MPSERS retiree health care benefits will be reduced by a scale proportionate to their years of service. These bills are particularly unfair to support staff, part-time employees and anyone who has "breaks in service" for time spent in the military and parents who take time off to raise children.

Support and part-time staff, like bus drivers, would need to work over 40 years to reach 30 years of service credit. In addition, the amount those employees receive in pensions are so small that having to pay up to 70% of their health care premiums would have the effect of taking away their pensions. These employees would likely have to receive health care through Medicaid, and that would cost the state more money.

Thank you for taking the time to listen to my concerns. I urge your opposition to this legislation and look forward to hearing your views on this important issue.

Sincerely,

Campaign Launched:
July 02, 2007