Northampton Mayor Mary Clare Higgins confirmed that eighteen months ago she retroactively removed from eligibility former city employees who had vested group health insurance benefits when they left the city’s employ. Interviewed May 30 Higgins said that for many years the city allowed former employees with ten or more years of service to utilize city health insurance upon retirement. Ultimately past employees who believed they had this coverage secured are now possibly faced with the grim reality of no health care at retirement.
In November 2005 Higgins blocked this long-standing benefit by creating a formal written policy. Revised in January 2006 Section 8 states:
Employees must have directly retired from active service with the City of Northampton or Northampton Public Schools.
All participation in the City’s contributory group health insurance must be continuous.
If a retiree cancels their enrollment or becomes ineligible for continued enrollment, they lose all eligibility to participate in the future–they cannot re-enroll at a future date regardless of qualifying event or life changes.
After checking with other communities Higgins determined that the long-standing practice was not a standard procedure. Although Higgins continued the unwritten practice during her mayoral tenure, she said that she was emulating sound business practices now by blocking the benefit because of the escalation in health insurance costs. However Wendy Foxmyn, former Assistant Administrator for the town of Wilbraham, said that she’s researched municipal group insurance policy extensively and concluded that there is no standard because policies differ from town to town. For instance Wilbraham allows former employees to join their group insurance plan at the time of retirement.
Higgins indicated that retired employees should have been notified of the change because the retirement board was supposed to have sent out notices and include an update in their newsletter. Current employees were to have been notified via a paycheck insert. Evidently no one alerted the media.
Higgins said she prefers to provide for people who remain employed by the city until they retire, not those who move on. In Northampton there are believed to be ten or more former employees who exercised a deferred option retirement.
When asked whether the city’s insurance advisory committee endorsed the policy she said no, that her decision falls outside of the committee’s statutory purview.
A former employee impacted by the new written policy questioned the legality of Higgins’ move to eliminate insurance eligibility retroactively and wondered if the new rule would apply to those who previously exercised this option. Higgins said she sought a legal opinion that states the city must treat everyone the same, but was not more specific.
Higgins’ gambit raises equity issues as well. According to Section 4 of the policy, certain elected officials are eligible for coverage regardless of the number of hours they work or their length of service. A first year school committee member working five hours a week for a $2,500 annual stipend can enter the insurance program and enjoy a benefit worth thousands of dollars more than the stipend.
During difficult fiscal times those in authority must make tough decisions and this is not an enviable task. By quietly breaking a long-standing promise concerning the health care of others while accepting a pay increase, Northampton’s supreme decision maker raises moral concerns regarding the equity of her leadership.
Higgins contradicted on group health benefits
In a telephone interview June 1 former city treasurer Shirley LaRose, who administered the city’s group health benefits, indicated that the retirement board has not sent the new group health benefits policy to the 311 retirees of the city. A current retirement board member, LaRose indicated that there was a brief mention included in the newsletter mailed in 2006, but was certain that the four-page policy in its entirety was not mailed because, "this is a function of the human resources department and not the retirement board."
From the 2005 newsletter mailed to retirees in mid 2006:
"The city of Northampton has changed the policies concerning deferred retirements. Vested employees can resign and defer retirement until they are older. If you are considering doing so, please talk to the Retirement staff and/or the Human Resources staff. Under the new policy, you will lose your eligibility to receive insurance benefits."
Glenda Stoddard, current director of human resources, indicated that she thought the retirement board was going to formally notify retirees. Other than the above brief as contained in the newsletter, retirees have not been notified in detail of the change that occurred in November 2005.
Regarding current employees, Ms. Stoddard indicated that the policy was distributed to all city department heads and that they were directed to notify employees. Notices were not sent via a paycheck insert as Higgins indicated according to Ms. Stoddard. She said there is no formal notification process in place and that no follow up has been done regarding whether all department heads have actually complied with the directive or how they might have done so.
At this point there is uncertainty and confusion regarding whether all current and former employees have been adequately notified of this new retroactive policy as instituted by Mayor Mary Clare Higgins. A policy of this nature that has the capability to impact the health care of perhaps over a thousand people should be delivered to these people in its entirety. Requesting employees past and present as well as retirees to sign and return a simple receipt indicating that they received the policy would constitute a sound business practice, something Higgins said she was emulating in making the change.
Higgins’ failure to understand the importance of accurately communicating this type of change in a timely fashion is facile and inappropriate. This is not a mere oversight but rather it constitutes a negligent, inconsiderate and dangerous act that must be corrected.
