Governor Patrick Signs Emergency Law that Significantly Reforms Municipal Health Care Law

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On July 12, 2011, Governor Patrick of Massachusetts signed “An Act Relative to Municipal Health Insurance” (H. 3580) into law. Originally part of the FY 2012 budget, significant reforms to the municipal health insurance system were proposed and adopted as separate emergency legislation. These reforms significantly loosen some of the strictures of collective bargaining, giving municipalities and other governmental entities more flexibility to reform their health insurance benefits. Under this new legislation,municipalities will now have an increased ability to transfer employees to the state’s Group Insurance Commission (“GIC”), reform their existing health insurance plans, and transfer members to Medicare, which may result in significant savings in many communities. However, as will become clear through this advisory, this reform requires several significant steps that may lessen the chance for savings to be realized in FY 2012.

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