In 2011, the State of Michigan passed Public Act 152, which requires that local units of government place a hard cap on their health care, institute an 80/20 cost sharing arrangement or opt out with 2/3 vote of the governing body.
PA 152 Compliance
Section 3 – Hard Caps
Beginning on or after January 1, 2013, a public employer may not pay more of the annual costs for medical benefit plans than a total amount equal to:
- $5,692.50, times the number of employees with single person coverage
- $11,385.00, times the number of employees with individual and spouse coverage
- $15,525.00, times the number of employees with family coverage
These amounts will be adjusted on October 1, 2013, for medical benefit plan coverage years beginning on or after January 1, 2014.
Section 4 - 80/20
A public employer, by a majority vote of its governing body for each plan year, may elect the 80% employer cap:
- A public employer may not pay more than 80% of the total annual costs of all the medical benefit plans it offers or contributes to for its employees and elected public officials
Section 5 – Exclusions
- Sections 3 and 4 do not apply to existing collective bargaining agreements or other contracts until the agreements or contracts expire, are extended, or renewed
- Any collective bargaining agreement executed on or after
September 15, 2011, must comply with sections 3 and 4
Section 8 – Exemption
By a 2/3 vote of their governing body each year, eligible local units of government may exempt themselves from the requirements of 2011 Public Act 152 for the next succeeding year.