AIMBlog_Logo_Resized

AIM Backs Reasoned, Long-Term Approach to Transportation

Posted by Brooke Thomson on Oct 30, 2019 7:08:11 AM

Virtually everyone in Massachusetts agrees that the commonwealth must repair, update and rethink its transportation system.

trafficsmallJust ask employers in metropolitan Boston where workers navigate daily reliability issues on the MBTA or persistent congestion on the Southeast Expressway. Or manufacturing companies in the Berkshires that struggle to ship products over back roads to the Turnpike. Or restaurants on the Cape that await customers locked in multi-mile backups over the Sagamore or Bourne bridges.

Improving the complex Massachusetts transportation system will require patience, prudence and compromise to reach a solution that lays the foundation for long-term economic growth. The 3,500 members of Associated Industries of Massachusetts know as business people that sorting out the financial, logistical and operational elements of transportation reform will take years of debate and continued analysis.

AIM supports a reasoned, long-term approach built around Governor Charlie Baker’s $18 billion transportation bond bill now pending in the state Legislature. That bond bill acknowledges what Transportation Secretary Stephanie Pollack told the AIM Executive Forum in September – the first step in any reform must be to remove current structural impediments that prevent the Department of Transportation and the T from spending the money that the taxpayers have already given them.

AIM believes that Massachusetts policymakers must provide procurement and policy reform to the transportation system before investing money into an outdate infrastructure.

AIM believes that any solution to the transportation issue must factor in the need to reduce greenhouse gases in the transportation sector to comply with state laws to reduce global warming. 

AIM supports transportation initiatives that are fair to people of all income levels and all regions of the commonwealth.

AIM acknowledges that the commonwealth may need to develop more revenue for transportation in the next three to four years once structural reforms have been accomplished. More work needs to be done to determine the best method of raising revenue and AIM recommends a deliberate approach to funding issues.

Here is AIM’s position on transportation:

AIM supports policies and responsible new investment to reduce congestion; grow capacity to deliver capital projects; lower carbon emissions in the transportation sector and ensure accountability and transparency in transportation investment spending.

  • AIM supports the governor’s bond bill – specifically those provisions that provide employer tax incentives, address congestion and put in place new Department of Transportation (MassDOT) and MBTA management and procurement tools;
  • AIM emphasizes the importance of procurement and contracting reform to get money flowing to projects at an accelerated rate. We support creating $1.4 billion in additional MBTA capital availability by changing the $127 million in annual appropriations to contract assistance or by increasing the annual Base Revenue Amount and Dedicated Sales Tax Revenue amount to the MBTA by $127 million.
  • AIM is open to reducing transportation emissions by supporting the Transportation Climate Initiative (TCI), a regional collaboration of 12 Northeast and Mid-Atlantic states and the District of Columbia that seeks to improve transportation, develop the clean-energy economy and reduce carbon emissions from the transportation sector.
  • AIM remains concerned about raising the gasoline tax because it is regressive and has a punitive effect on less populated regions of the commonwealth;
  • Because AIM is the statewide business association, we support a transportation plan that meets in a fair manner the diverse needs of all regions of the commonwealth;
  • AIM supports studies exploring congestion pricing as a means of reducing or mitigating congestion. Congestion pricing must apply equally to all industries and all types of vehicles and not target specific industries such as ride-sharing companies;
  • AIM supports policies that add governance structures to ensure accountability and transparency in transportation revenue spending;
  • AIM supports $105 million in transportation funding in the supplemental budget currently in conference committee on Beacon Hill: $50 million for MBTA, $40 million for Chapter 90, $10 million for municipal complete streets program.

The AIM Board of Directors continues to discuss details of a transportation proposal. The ongoing discussion reflects the importance that the Board attaches to the transportation debate.

Please contact Bob Rio, Senior Vice President, rrio@aimnet.org, for updates on the transportation debate.

Topics: Massachusetts Legislature, Transportation, Charlie Baker

Accountability Key to Education Funding Reform

Posted by John Regan on Sep 3, 2019 8:00:00 AM

Massachusetts is about to undertake the most sweeping restructuring of public-education funding since 1993.

What does it mean for employers?

EducationThe 3,500 member companies of Associated Industries of Massachusetts (AIM) who depend upon the public schools to prepare the workforce of the future support education reform that contains specific and measurable performance objectives. Anyone who owns or manages a business tracks return on investment and the investment we make in our public schools and students should be no different.

Employers do not support the sort of reform being promoted by some advocates who have been calling at rallies for a “blank check” of billions of dollars of state aid with no accountability.

The Massachusetts Legislature is expected to debate changes this fall to the formula used to provide money to school districts around the commonwealth. The formula was developed in 1993 as a way to equalize per-pupil school spending between poor communities with shrinking property tax bases and wealthy communities that invest significant amounts of money on their school systems.

But most people now agree that the so-called Foundation Budget is not working.

While the National Assessment of Education Progress indicates that Massachusetts has the best public schools in the nation, that same assessment shows significant achievement gaps between white students and black and Latino students. Massachusetts finds itself in the bottom half of states with respect to Black-White achievement gaps across almost all grades in reading and math and in the bottom third of states with respect to Latino-White achievement gaps across all grades in both reading and math.

The achievement gap matters to employers confronting a persistent shortage of qualified workers in an economy running at 2.9 percent unemployment. With a demographic cliff looming as baby boomer retirements threaten to shrink the size of the state labor force, Massachusetts cannot overlook any citizen who might help Bay State employers compete in the global economy.

There are other issues as well. A report this year by the Massachusetts Business Alliance for Education (MBAE), the Massachusetts Business Roundtable and AIM found that employers continue to see a gap between the overall performance of the schools and the job those schools are doing preparing students for the workforce. Business leaders want schools to improve the applied skills taught to students, hire better teachers, increase hands-on and vocational/technical education, and forge business partnerships.

Reforming the school funding formula will probably cost taxpayers around $1 billion. Employers understand better than anyone the importance of making strategic investments, but they also know that pouring money into a broken system is not the answer. Employer support for education reform hinges on the establishment of clear and measurable standards that will allow everyone to determine whether changes are working for students, teachers and the commonwealth.

The evidence is clear that more money does not equal better educational performance. An online analysis of school funding by MBAE in June showed that schools serving similar student populations and spending the same amount per student can achieve dramatically different results.

For example, an elementary school in Winchendon spending $13,644 per student and serving 38 percent low-income students and 18 percent special education students has only 31 percent of students on grade level in math, while a school in Revere spending $13,913 per student and serving 43 percent low-income students and 20 percent special education students has 67 percent on grade level in math.

AIM and the rest of the Massachusetts business community insist that the following accountability measured by part of any education funding reform:

  1. Fully implement the recommendations of the Foundation Budget Review Commission through a multi-year, fully funded revision to the Chapter 70 formula that will achieve adequacy and equity for all students. Funding provisions should include revisions to the charter-school tuition reimbursement program schedule and percentages.

  2. Maintain and enhance the state accountability system to ensure new funds go to those students who need them the most and are used effectively to close achievement gaps, set statewide and district targets for closing those gaps with annual reporting on progress, and collect and report on data related to college and career readiness. The state should require, at a minimum, a user-friendly set of comparable data from school to school that correlates with student post-graduation success.

  3. Add a new Chapter 70 enrollment category for Early College and Career Pathways to enable replication and expansion of these promising high-school reform strategies. Every effort should be made to create a new approach to preparing students for the future, including the awarding of industry-recognized credentials, work-based learning opportunities, and successful college and career pathway programs.

  4. Provide significant and supplemental funding for innovation and the implementation of best practices in under-performing schools. It is vital to set aside money to support grants to schools and districts to innovate and create new approaches to closing achievement, opportunity, and skills gaps.

  5. Enact Innovation Partnership Zone legislation to provide communities with a new tool for empowering schools and educators to address persistent low-performance and encourage innovation. Allowing for the expansion of autonomy and flexibility for educators, with school and zone level decision-making, these “zones” can create collaborative partnerships for success and should be extended for voluntary use across the state.

MBAE will conduct a State House briefing on September 10 at 11 am to allow employers to outline the business view of education reform to members of the legislature. The briefing will include individual meetings with legislators to discuss the need for accountability in any changes to the school funding formula. Please contact MBAE to register.

AIM joined other business groups in August to urge Jeffery C. Riley, Commissioner of Elementary and Secondary Education, to ensure that additional money provided to schools in the current state budget reach the students for which it is intended.

Please contact Katie Holahan, Vice President of Government Affairs at AIM, for updates on education issues.

Topics: Education Reform, Massachusetts Legislature, Education

Leaders Agree to Delay Start of Paid Leave Assessments

Posted by Brad MacDougall on Jun 11, 2019 6:10:21 PM

Governor Charlie Baker on Thursday signed legislation that will extend by three months the July 1 starting date for contributions to the new Massachusetts paid family and medical leave program.

Baker, along with House Speaker Robert DeLeo and Senate President Karen Spilka, had committed to a delay on Tuesday.

statehousedome"To ensure businesses have adequate time to implement the state’s Paid Family and Medical Leave program, the House, Senate, and Administration have agreed to adopt a three month delay to the start of required contributions to the program. We will also adopt technical changes to clarify program design. We look forward to the successful implementation of this program this fall,” read a joint statement issued by the three leaders.

The action comes three weeks after AIM, Raise Up Massachusetts and other groups sought a delay to permit employers, employees and the marketplace to prepare for the sweeping new benefit approved last year. AIM and its 3,500 members are particularly concerned about the lack of clarity surrounding opt-outs and cost sharing with employees.

The delay will not reduce total contributions paid to the new family and medical leave trust fund because the state will increase the contribution rate from .63 percent to .75 percent of wages. The new contribution rate will raise the tax for an employee earning the state average weekly wage from $872 per year to $1,038 per year.

Workers will be able to access paid leave benefits beginning in January 2021.

“Associated Industries of Massachusetts (AIM) and its 3,500 member companies are gratified that the governor, House speaker and Senate president today committed to a three-month delay in the start of the paid family and medical leave program. The decision will allow employers and workers alike to prepare themselves for the era of paid leave and ensure that this landmark initiative gets off the ground successfully,” said John Regan, President and CEO of AIM.

“The state’s top elected leaders deserve tremendous credit for recognizing the need to adjust the timing of the program’s capitalization and to make minor adjustments to the law that was passed last year. AIM is also grateful to the 52 state legislators who sent letters to Beacon Hill leaders urging them to take this action.”

The proposed adjustments to the law include five amendments intended to provide clarity on issues such as intermittent leave and the definition of “serious medical condition.” The clarifying amendments will also align core principles of the Massachusetts paid family and medical leave law with the federal Family and Medical Leave Act (FMLA).

AIM-member employers sent more than 2,500 messages to Governor Charlie Baker and Beacon Hill leaders last month indicating that they do have adequate time or information to make decisions about how to much of the paid leave assessment to share with employees or whether to elect a private-sector alternative to the state program. One company wrote that it has been trying to determine how to implement the new law while preserving the paid medical leave benefit that it already offers its associates because it is more generous than the state law.

“I have contacted insurance companies to get a cost estimate for a paid family leave policy in order to determine our best course of action on that part of the law, but no one is ready to quote a product yet.   We don't even know if the deductions from employees pay should be pre- or post- tax,” the company wrote.

Joining AIM and Raise Up in calling for a delay were the Greater Boston Chamber of Commerce, The Coalition for Social Justice, Local 509 of the Service Employees International Union, Greater Boston Legal Services, The Massachusetts Business Roundtable, the Alliance for Business Leadership and the Springfield Regional Chamber of Commerce.

The administration attempted to allay employer concerns last month by extending the deadline for employers to secure private insurance that would allow them to opt out of the paid leave system. The administration also extended the deadline for employers to inform workers about opt-out plans from May 31 to the end of June.

The business and advocacy groups commended the administration’s efforts but said they will not solve the problem.

“Given the lack of employer clarity on the regulations, the importance of communicating with employees regarding payroll deductions, and the ability for insurance providers to offer a private-sector option, we continue to support and urge legislative action on the proposed amendment extending the deadline for private plan approvals and the commencement of required contributions from July 1, 2019, to October 1, 2019…” the group wrote.

The paid family and medical leave law provides workers with 12 weeks of family leave and 20 weeks of personal medical leave. Workers on paid leave will earn 80 percent of their wages up to 50 percent of the state average weekly wage, then 50 percent of wages above that amount.

The employer is required to pay at least 60 percent of the medical leave contribution required for each employee. The employer is required to pay none of the contribution for family leave. Employers may, of course, pay a higher percentage for each category of leave or elect to pay the entire contribution for each employee.

“The business community remains committed to the successful implementation of paid family and medical leave in Massachusetts,” Regan said.

Want updates on paid family and medical leave in Massachusetts? Contact Brad MacDougall, bmacdougall@aimnet.org.

 

Topics: Massachusetts Legislature, Charlie Baker, Mandated Paid Leave, Paid Family Leave

Business, Advocates Join to Ask for Paid Leave Delay

Posted by Brad MacDougall on May 20, 2019 5:42:34 PM

Associated Industries of Massachusetts and the business organizations and advocates who last year negotiated a compromise version of paid family and medical leave are together asking state leaders to postpone the July 1 starting date of the program by three months.

statehousedome“In the course of our work together we have identified the need for a three-month extension of the July 1, 2019 deadline for approval of employers’ private paid family and medical leave plans and the commencement of the required plan contributions,” the groups said in a letter to Governor Charlie Baker, House Speaker Robert DeLeo and Senate President Karen Spilka.

“In addition, there are five other amendments to chapter 121 of the Acts of 2018 that are necessary for clarification of rights and responsibilities of stakeholders to effect the smooth implementation and operation of the new law,” the letter said.

The group noted that the extension would not impact any of the benefits or the timing for eligibility of benefits under the new law.

Signers of the letter include AIM, Raise Up Massachusetts, The Greater Boston Chamber of Commerce, The Coalition for Social Justice, Local 509 of the Service Employees International Union, Greater Boston Legal Services, The Massachusetts Business Roundtable, the Alliance for Business Leadership and the Chamber of Commerce of Greater Springfield.

The call for a delay from politically diverse groups reflects growing concern that neither the marketplace nor employers nor their workers are adequately prepared for the sweeping new benefits program.

The Baker Administration attempt to allay those concerns three weeks ago by extending the deadline for employers to secure private insurance that would allow them to opt out of the paid leave system. The administration also extended the deadline for employers to inform workers about opt-out plans from May 31 to the end of June.

The business and advocacy groups commended the administration’s efforts.

“However, given the lack of employer clarity on the regulations, the importance of communicating with employees regarding payroll deductions, and the ability for insurance providers to offer a private-sector option, we continue to support and urge legislative action on the proposed amendment extending the deadline for private plan approvals and the commencement of required contributions from July 1, 2019, to October 1, 2019, as well as the additional five clarifying amendments to the statute…” the group writes.

The proposed amendments are intended to provide clarity for employers, insurance providers (developing and providing products to employers), employees applying for the leaves covered by the new law, and health care providers certifying the need for leave. In addition, the clarifying amendments align core principles of the Massachusetts paid family and medical leave law with the federal Family and Medical Leave Act (FMLA).

The amendments include:

  1. Intermittent Leave – This amendment would clarify that leave taken on an intermittent or reduced leave schedule reduces the amount of remaining leave available to a covered worker. This change tracks the language of the federal FMLA.
  2. Serious health condition – This amendment clarifies that eligibility for medical leave for the covered individual’s own serious health condition arises where such a serious health condition “makes the covered individual unable to perform the functions of the covered individual's job.”

If you are an AIM Member and want updates sign up here or contact Brad MacDougall.

Not an AIM member?  Contact Bob Paine to learn how AIM’s advocacy and resources can help your company.

Topics: Massachusetts Legislature, Charlie Baker, Paid Family Leave

The Millionaires Tax is a Failure

Posted by John Regan on Apr 11, 2019 8:34:11 AM

The “millionaires tax” is a failure.

Small BusinessEvidence from states that have already imposed a surtax on incomes of more than $1 million shows that the policy causes irreparable harm to the economy while generating far less tax revenue than promised.

A millionaires tax will cause the same harm in Massachusetts, Associated Industries of Massachusetts will tell the Legislature’s Joint Committee on Revenue today.

Lawmakers have refiled a proposal to amend the state Constitution to impose a graduated income tax, adding a four percentage-point tax (representing an 80 percent increase in the personal income tax rate) on all incomes more than $1 million. The amendment would dictate that the revenue be spent on transportation and education.

An identical proposal was struck down by the Supreme Judicial Court last year in a suit brought by AIM President Rick Lord and the leaders of four other business groups, but the current proposal operates under different rules because it was filed by legislators.

A graduated income tax would eviscerate the small, family owned businesses that form the heart of the Massachusetts economy. The surtax would take an estimated $2 billion from some 17,000 Main Street businesses and others that pay taxes at the individual rate and who would otherwise use the money to hire additional employers or expand their companies.

These companies are already drowning in more than $1.5 billion in new taxes and fees to pay for a financial shortfall in the Medicaid program and to fund the new paid family and medical leave program.

How do we know that surtaxes don't work?

Because our neighbors in Connecticut just drove their economy off a cliff by raising taxes three times in the past 10 years.

Connecticut in 2009 added a 6.5 percent income tax bracket for those earning more than $500,000 per year. The state followed up with a comprehensive $1.5 billion tax increase in 2011 to deal with a budget shortfall. A final round of tax increases took effect in 2015.

According to information compiled by Pew Charitable Trusts, tax revenue for all 50 states is averaging 6.3 percent higher than it was at the start of the 2008 recession. Connecticut tax revenue, on the other hand, is only 3.8 percent higher, despite the three tax increases.

Once the economic heavyweight of New England, Connecticut is the only state in the nation which has yet to recover the jobs lost during the economic downturn.

In addition, the state has seen an out-migration of residents since 2013 and the loss of major financial investors. Data from the Internal Revenue Service showed a spike in residents earning more than $200,000 per leaving the state in 2015 and studies conducted by Connecticut state agencies and commissions have confirmed the loss of higher income residents to other states.

Income surtax laws have failed in other states as well.

Within three years of Maryland enacting its “millionaire tax,” 40 percent of the state’s seven-figure earners were gone from the tax rolls - and so was $1.7 billion from the state tax base.

Similarly, in 2010 Boston College researchers released a report on the migration of wealthy households to and from New Jersey. They concluded that wealthier New Jersey households did in fact consider the high-earner taxes when deciding whether to move to or remain in New Jersey.

The researchers’ data analysis found that from 1999 to 2003 - before the millionaires tax was imposed - there was a net influx of $98 billion in household wealth into the state. After the tax was implemented, an increasing number of wealthy families left the state, resulting in a loss of $70 billion in wealth.

Many of the business owners who fled Connecticut, Maryland and New Jersey moved to states that have worked to reduce, rather than boost, taxes:

  • North Carolina revenues grew 3.8 percent in 2016. As a result, it has reduced its 5.49 percent income tax to 5.24 percent in 2019.  It also will reduce its corporate tax to the lowest in the nation at 2.5 percent and will repeal the corporate levy as more businesses move in and revenues increase.
  • New Hampshire, a state with no income tax, is reducing corporate taxes two years in a row because of revenue growth of 2 percent.
  • Georgia is also reducing income and corporate taxes in 2019 because of a strong revenue growth rate of 4.5 percent.
  • Tennessee only taxes interest and dividends and reduced tax rates from 6 to 3 percent as its population grew 6.7 percent from 2010-2017 and revenues increased 2.4 percent.

Topics: Massachusetts Legislature, Income Surtax, Taxation

AIM Calls on Legislature to End MassHealth Assessment on Employers

Posted by Katie Holahan on Mar 26, 2019 1:52:06 PM

Editor's note - AIM Vice President of Government Affairs Katie Holahan today delivered the following testimony to the Legislature's Joint  Committee on Labor and Workforce Development in favor of ending the MassHealth employer assessment.

State House 2015Associated Industries of Massachusetts (AIM), on behalf of its member companies, supports H.1647, An Act relative to repealing the employer medical assistance contribution tax. We support an end to the two-year assessment imposed on employers to close a financial gap at the state’s MassHealth insurance program for low-income residents.

AIM believes the assessment is no longer necessary as employers last year paid tens of millions of dollars more than anticipated originally under the levy.

The prior, existing Employer Medical Assistance Contribution (EMAC) assessment increased from $51 to $77 per employee, and employers were required to pay up to $750 for each worker receiving public health benefits. By the time the EMAC assessment sunsets in 2019, Massachusetts businesses are on track to contribute $519 million instead of the $400 million envisioned under the 2017 legislation – or 30 percent more than originally estimated.

At the same time, enrollment in MassHealth has fallen as the administration has initiated steps to ensure that only those eligible for benefits receive them.

The Legislature passed the assessment in July 2017, minus a set of structural reforms proposed by the governor to place the MassHealth/Medicaid program on a firm financial footing. The assessment fell most heavily upon companies whose employees elect to use MassHealth rather than the employer-sponsored health plan.

AIM member employers are proud to lead the nation in providing health care coverage to their employees. Sixty-five percent of Bay State companies offer health insurance coverage to their workers, compared with 56 percent of employers nationwide. A full 100 percent of Massachusetts employers with 200 or more employees offer coverage.

As health-care premium and utilization costs continue to grow, employers have fewer options and less flexibility to keep year-over-year increases in check, raising important concerns about their ability to offer comprehensive insurance to their employees. Adding the cost of the state’s public health insurance program is not a sustainable financial plan, long-term.

Employers stand ready to work with policymakers to make comprehensive structural reforms to both the MassHealth program and commercial insurance markets to make the financing of health care for all Massachusetts residents sustainable this year and for many years to come.

Topics: Massachusetts Legislature, Health Care Costs, Health Insurance

Senate President Calls for 'Bold Steps'

Posted by Christopher Geehern on Mar 15, 2019 11:20:37 AM

 

Senate President Karen E. Spilka today called for Massachusetts to take “bold steps” to address issues such as transportation, education, health-care costs and economic development in the face of relentless changes to the state economy.

SP.Spilka“The common thread of all the challenges we face is unprecedented change. The success of our Commonwealth will ultimately be measured by how well we navigate and harness the potential of this change,” Spilka told more than 300 business leaders at the AIM Executive Forum on Waltham.

She said Massachusetts finds itself in a unique political moment that will determine the future course of its economy.

“It would be a mistake to waste this moment on incremental changes and small ideas,” she said. “Now is the time to be bold. That said, we have to find a way to reach consensus on our bold ideas.”

Spilka said state leaders must replicate the collaborative model of last year’s “grand bargain,” which brought together employers, advocacy groups and legislators to hammer out a compromise on paid family leave and the minimum wage. She thanked the business community for engaging in those conversations and invited employers to continue to participate in major policy debates.

The Senate President cited the growth of the Metrowest district she represents as an example of the challenges and opportunities facing the Massachusetts economy. Technology and innovation have transformed Metrowest from a Boston bedroom region to the home of major employers like Staples, TJX and Boston Scientific, but that growth has stressed the transportation infrastructure and priced some workers out of the housing market.

She acknowledged that resolving these issues carries a large price tag.

“I firmly believe we must create an economic development and tax framework for the 21st century where innovative technology-driven businesses can develop and thrive here but where we also capture new revenue to continue providing essential services, and fund our vision for our future,” she told the audience.

“So far, we have been addressing these new industries on a piecemeal basis, which only serves to breed confusion for business, government, and consumers. We must work together to find a balance that benefits us all, especially as we will be relying on these industries to continue to fuel our economic success.”

Spilka said the Senate will address health-care costs by looking at the price of prescription drugs and the cost transparency of the medical system. She praised the initiative led by AIM and the Massachusetts Taxpayers Foundation to reduce unnecessary use of emergency rooms.

Topics: Massachusetts Legislature, AIM Executive Forum, Senate President Karen Spilka

AIM's John Regan Talks Issues on Comcast Newsmakers

Posted by Christopher Geehern on Jan 31, 2019 12:38:52 PM

John Regan, AIM's Executive Vice President of Government Affairs, recently joined Comcast Newsmakers and host Jenny Johnson for a look at the issues facing employers as the Massachusetts Legislature begins a new, two-year session.

Regan.Comcast.2019

 

 

 

Topics: Massachusetts Legislature, Associated Industries of Massachusetts, Charlie Baker

AIM Calls for End to MassHealth Employer Assessment

Posted by Rick Lord on Jan 2, 2019 8:57:01 AM

Associated Industries of Massachusetts and its 4,000 member companies today called upon the Legislature and Governor Charlie Baker to end to the two-year assessment imposed on employers last year to close a financial gap at the state’s MassHealth insurance program for low-income residents.

health_careAIM believes the assessment is no longer necessary because employers last year paid tens of millions of dollars more than anticipated under the levy. Businesses are on track to contribute some $519 million by the time the assessment sunsets at the end of this year instead of the $400 million envisioned under the 2017 legislation.

At the same time, enrollment in MassHealth has fallen as the Baker Administration has initiated steps to ensure that only people eligible for benefits receive them. And state tax collections have exceeded targets over the past several months, putting the state on firmer financial footing.

“The conditions that led to the imposition of the surcharge no longer exist. Employers who have paid hundreds of millions of dollars in assessments believe it is fair to look at ending the surcharge in year two,” said John Regan, Executive Vice President of Government Affairs at AIM.

The Legislature passed the assessment in July 2017 minus a set of structural reforms proposed by Governor Baker to place the MassHealth/Medicaid program on a firm financial footing. The assessment fell most heavily upon companies in which employees elect to use MassHealth rather than the employer-sponsored health plan.

The Boston Globe: Employer group balks at fees to prop up MassHealth

An existing assessment called the employer medical assistance contribution (EMAC) increased from $51 to $77 per employee. Employers also were required to pay up to $750 for each worker who receives public health benefits.

Employers may request a waiver from the fees if they prove a hardship. Of 246 such waiver requests, administration officials said they have allowed 99.

Governor Baker originally proposed a $2,000-per-employee assessment upon companies at which at least 80 percent of full-time worker equivalents did not take the company’s offer of health insurance, and that did not make a minimum contribution of $4,950 annual contribution for each full-time worker. That proposal encountered significant opposition from the business community.

AIM member employers are proud to lead the nation in providing health care coverage to their employees. Sixty-five percent of Bay State companies offer health insurance coverage to their workers, compared with 56 percent of employers nationwide. A full 100 percent of Massachusetts employers with 200 or more employees offer coverage. 

Employers stand ready to work with policymakers to make long-term structural reforms to both the MassHealth program and the commercial insurance markets to make the financing of health care for Massachusetts residents sustainable.

“Eleven years ago, employers joined with doctors, hospitals, patient advocates and lawmakers to forge a health-reform law that required all parties to share the responsibility for improving access to health care. The employer community calls for that same sense of shared responsibility now to solve the MassHealth shortfall,” Regan said.

Please contact Katie Holahan, Vice President of Government Affairs at AIM, keh@aimnet.org, for updates on this issue.

Topics: Massachusetts Legislature, Health Care, Charlie Baker, Employer Health Assessment

Potential Legislative Involvement in Lockout Sets Dangerous Precedent

Posted by John Regan on Nov 2, 2018 8:34:04 AM

Proposed legislation that would penalize National Grid during the ongoing lockout of gas workers represents a troubling – and perhaps unconstitutional – foray by Beacon Hill into a private-sector labor dispute.

State House 2015The bill, called An Act relative to the employment of certain workers by National Grid, would prohibit National Grid from:

  • receiving public funds for the upgrade, repair, installation or maintenance of its gas distribution system
  • applying for funds to assist in paying the costs of gate box maintenance and improvements, or
  • receiving from the Massachusetts Department of Public Utilities any increase in its rates for consumer gas or electric distribution.

The bill would also require National Grid to continue to provide health insurance under its expired collective bargaining agreements with Steelworkers Locals 12003 and 12012-04.

The House of Representatives has admitted the bill, but no hearing has been scheduled. The measure is unlikely to pass before January since the Legislature remains in informal session when a single legislator may stop a bill.

National Grid, which provides natural-gas service to 116 Massachusetts communities, has 85 communities impacted by a lockout of 1,250 workers after the Steelworkers rejected a five-year contract offer that will boost the current average employee salary, including overtime, from $120,000 a year to $137,000.

The offer also includes a 10 percent increase in the pension plan for current employees, while new employees would be assigned to a completely company-funded defined contribution plan with a 3 to 9 percent company match, in addition to a regular 401 (k) with a company match. The company’s health insurance proposal would also introduce modest deductibles and coinsurance, which the unions currently do not pay.

Intervention in a private labor dispute is beyond the scope of the Massachusetts Legislature and sets a dangerous precedent for the ability of government to takes sides in negotiations between companies and their workers. If lawmakers interject themselves in the National Grid lockout, what would prevent them from also becoming involved in disputes involving manufacturing, service or technology companies across the commonwealth?

The bill would tread upon and regulate a sphere of private sector collective bargaining that is intended to be unregulated by the U.S. Congress.  As such, the legislation is pre-empted by the National Labor Relations Act.  Strikes and lockouts are both federally protected actions.

The federal courts have a long history of pre-empting local and state efforts to shape labor disputes. In 1986, for example, the U.S. Supreme Court pre-empted the Los Angeles City Council’s bid to condition renewal of a taxi license on the resolution of a labor dispute.

The proposal could also violate the United States Constitution because, in targeting National Grid and only National Grid, it constitutes a Bill of Attainder proscribed by Article 1 of the Constitution. 

No one likes labor disputes and AIM joins others in hoping that National Grid and its unions can find common ground soon. That hope should not, however, lead elected officials down the road of political expediency.

Topics: Massachusetts Legislature, Energy, Organized Labor

Subscribe to our blog

Posts by popularity

Browse by Tag