June 8, 2004
Contact: Sue Baker
For Immediate Release 738-2000, ext. 6200
Avedisian
implements health insurance co-payment, eliminates longevity for new hires
The mayor also requires non-union employees to contribute to health insurance,
asks unions to consider reopening contracts
WARWICK – In an effort to reduce the financial burden on taxpayers, Mayor
Scott Avedisian yesterday issued executive orders that will eliminate longevity
for non-union employees hired after July 1, 2004 and will require them to contribute
5 percent of their salaries for family health insurance plans and 2.5 percent
toward individual coverage.
Executive Order 2004-09 also implements a graduated health insurance co-payment plan for current non-union employees as follows: contribution of one percent of salary for those enrolled in family health insurance plans and half of one percent of salary for those with individual plans, effective July 1, 2004; contribution of two percent of salary for those enrolled in family health insurance plans and one percent of salary for those with individual plans, effective July 1, 2005; contribution of four percent two percent, respectively, effective July 1, 2006; and contribution of five percent and two-and-a-half percent, effective July 1, 2007;
Affecting approximately 130 people, the order will realize savings of nearly $60,000 in its first year alone.
Yesterday, Avedisian also asked the presidents of the three city unions – police, fire, and municipal workers – to meet with him to consider reopening their contracts to include a similar co-payment clause. (The fire contract expires June 30, 2005, the other two June 30, 2006. Avedisian recently negotiated a three-year contract with the Crossing Guard union that requires, for the first time in the city’s history, union members to contribute to the cost of their health insurance plans.)
Avedisian wrote today to School Superintendent Robert Shapiro and the Warwick School Committee to ask them to consider implementing a similar policy in the School Department. (By City Charter, although municipalities are required to fund schools, neither the Mayor nor the City Council negotiates teacher contracts, nor do they have jurisdiction on how school monies are spent.)
“The budget I submitted to the City Council is conservative in municipal
spending,” Avedisian said. “However, while many of the costs associated
with the City of Warwick’s budget are fixed due to contractual obligations,
I am concerned about the effect of the new tax rate on our residents, particularly
those who are already struggling financially or who rely on Social Security
as their sole source of income.
“Throughout the budget hearings, we heard clearly the call for employees to contribute to their health insurance benefits,” Avedisian said. “Some who are affected by this new policy may feel it’s unfair. Nevertheless, we need to start somewhere, and I think it’s an important first step to curb spending and, hopefully, to set the stage so that other employees will follow suit.”