Youngstown city workers join real world on health insurance

With the city of Youngstown bracing for a bumpy fiscal ride next year, Mayor John A. McNally had little choice but to tackle one of the big-ticket items in the budget. However, aware of the explosive nature of the issue, McNally showed foresight in engaging all interested parties in the development of a solution.

The result: Significant changes to employee health insurance that will result in the cost of the plan going up less than it would have had nothing been done.

But doing nothing was not an option for city government, considering that the revenue streams for 2016 and 2017 are expected to be drier than they are this year. Youngstown is no different from other older urban communities: The population is declining; the income-tax base is shrinking; neighborhoods are being undermined by the growing number of dilapidated structures and crime; and, the public school system is a contributing factor to the exodus of families with school-age children.

The mayor previously has talked about some of the red flags the city of Youngstown must pay attention to, including:

The loss of income tax revenue as a result of the private prison on Hubbard Road losing a major U.S. Bureau of Prisons’ contract to house federal inmates.

The expected closing of the U.S. Postal Service’s distribution center.

The furlough of workers at the new Vallourec Star steel-pipe making, state-of-the-art complex on Route 422 due to the fact that oil and gas exploration has taken a hit with the steep drop in oil and gas prices.

Vallourec Star opened with the expectation of riches for the cities of Youngstown and Girard, not only because of the agreements reached, but because of the company’s average yearly wage of $50,000-plus.

Against that bleak financial backdrop, Youngstown city government has no choice but to cut costs. And since most of the operating budget goes for employee wages and benefits, the need to lower that tab is obvious.

MAYOR’S COMMENTS

In commenting on the changes to the health insurance plan, Mayor McNally said, “I’m very appreciative of the work done by all of the committee members. People expect us in the public sector to pay more attention to health care costs, and we did. This allows our employees to make decisions that are best for them and their families.”

The mayor is absolutely right: Private-sector taxpayers who have been bearing an increasing portion of the health care costs — if health insurance is even offered by their employers — have long wondered why their employees (public-sector workers) haven’t had to pay their fair share for coverage.

Indeed, one of the most important changes made to the city’s health insurance policy has to do with deductibles. Until last week when city council and the board of control approved the new plan, developed by a 17-member management-employee health-insurance review committee, city workers did not pay a medical deductible. How is that possible? Because it’s the public sector — which has yet to catch up with the private sector when it comes to sharing the cost of benefits with the employer.

That said, we do applaud Youngstown government for recognizing that the status quo — read that, lucrative wages and benefits — is no longer sustainable.

The changes to the health insurance plan must be only the first step in a complete reassessment of the benefit package.