Don’t Assume The Legislature Will Go Along With Public Employee Insurance Changes

On Monday we got a glimpse into Governor Burgum’s version of the state budget. Though official bill drafts and amendments have not yet been introduced, we’ve received his priorities in a press release. One of the proposals that stood out to me was the potential for public employees to begin paying into the premiums of their insurance benefit.

Under Burgum’s attempt to run the state like a business, he’s requested that public employees pay 5% of their premiums. To the general public who has likely paid their insurance premiums for a long time, they may have little sympathy for this change. But as the public employee union, North Dakota United, has correctly pointed out the insurance benefit in the state is a good recruitment tool. The benefit recruits and retains high-quality teachers, law enforcement, and snow plow drivers. Hell, it is why some people even run for the legislature, to get that insurance benefit.

Therein lies why I don’t expect the legislature to go along with Burgum’s insurance change. It is their insurance benefit. We have already seen the legislature is willing to fight long into the session to defend their own insurance package. In 2015 Sanford Health was awarded the contract for the Public Employees Retirement System (PERS). The change just happened to take place while the 64th Legislative Session was meeting. The timing of it all led legislators to introduce bills that ensure their insurance wasn’t negatively impacted. Some even wanted to overturn the change from Blue Cross Blue Shield to Sanford.

The debate was heated between the Senate and the House in the waning days of the session. The Senate defeated the House’s bill that micromanaged the PERS Board decision. In return, the House amended most of the language of that defeated bill and placed it into another bill that was in their chamber. That bill ended up being the last debate in 2015. The House of Representatives eventually closed up shop and left town without resolving the PERS budget because the Senate wouldn’t go along. We eventually came back together a few weeks later and resolved the differences. The whole thing cost you, the taxpayers, tens of thousands of dollars and left an embarrassing mark on legislative leadership.

The point of telling you that story is to demonstrate how relentless the legislative body can be when it comes to defending their benefits. Let’s take this 5% proposal and show you how that will impact the legislature. Members get paid two ways. They earn $177 per day during the session which meets for approximately four months every other year and for interim meetings. They also earn a monthly stipend of $495. The 5% premium buy in of Burgum’s proposal would basically mean legislators would need to give up almost two full months of their stipend to cover the cost. What do you think the chances are of that happening?

Rather than going along with Burgum’s 5% insurance premium buy in, anticipate the legislature to use this proposal as a bargaining chip. Don’t be surprised to see something along the lines of keeping public employee’s salaries stagnant for a longer period of time in exchange for covering the cost of the insurance premium. That is one way the legislature can minimize the impact on themselves.

This change is obviously important to the 15,000 plus public employees and their families. If we go down the path of poor compensation and diminished benefits we may find it more difficult to recruit and retain the teachers, law enforcement, and snow plow drivers we all rely on.  That is why you should take an interest in this debate.