Common Council member, and candidate for mayor plans to deliver this letter to the office of Mayor Sebastian Giuliano this morning.
Mayor Sebastian N. Giuliano
City of Middletown
Middletown, CT 06457
Re: Suspension of Free HMO Progam for Future Retirees
Dear Mayor Giuliano,
Recently, I received a copy of the above referenced memo, dated January 23, 2009, prepared by Director D. Milardo and distributed to all city employees. This letter explains that the city "...has offered free HMO medical programs to those who retired from service...and... is above what is contained within their Collective Bargaining Agreements." There was a logical explanation for the original basis for the benefit to move more employees into the HMO plan for health insurance because of the anticipated savings. Director Milardo pointed out that the City can no longer continue the 100% health care costs for retirees, dependents and employees eligible to retire. Employees were notified they must decide by March 1, 2009 if they will retire to retain this benefit. Employees retiring after this date will receive health benefits under the terms and conditions of their collective bargaining agreements (the 100% option will no longer apply). This letter mandates that employees notify the City before March 1, 2009 and leave by March 1, 2009 if they wish to retain this health benefit option.
One key question is how many employees choosing to retire before March 1st will need to be replaced. I’m told that school crossing guards, BOE business officials, several police officers and firefighters and other key city positions are considering retirement because of fear of losing this benefit. Crossing guards are critical for safety and I don’t think it is wise or sound financial use of police officers to cover crossing guard posts. Further, for essential positions needing to be replaced, the City will now be paying two health insurance benefits, one for the retiree and one for the new hire. Both Chief Baldoni and Superintendant Frechette should be evaluating this issue.
With this letter, I request the financial impact of your decision be provided to the Common Council. How many taxpayer dollars will be saved by discontinuing the free HMO in respect to future retirees that choose to remain in the PPO health benefit versus the free HMO. Also, what is the saved wages benefit in comparison to replacement salaries, cost of duplicative health insurance, as well as, the personal impact on employees and services they provide?
I am also extremely concerned that the March 1 deadline will cause serious disruption in the functions of various departments. The notice was sent to employees the end of January ! Employees were surprised by this memo and it will likely take several weeks to come to decision for many. This leaves only 2-3 weeks to determine how a loss of staffing will be properly coordinated and managed. It is my understanding that refilling of positions will be offered to city employees first within the bargaining units. This could create a compounding or domino effect of service disorder to other departments. It is my firm belief employees should notify the city of their retirement decision by March 1 but that the transition to retirement be treated on a case-by-case basis with all eligible employees being required to leave by June 30, 2009 if it is truly a financial savings. With this approach, departments can plan accordingly, cross train replacement employees if necessary, implement succession planning and limit disruptions for the employees, taxpayers and citizens of the city.
Ronald P. Klattenberg, Councilman
Chairman, Finance and Government Operations