On June 26, 2018, Mayor Bill de Blasio announced a second health savings agreement with the Municipal Labor Committee (MLC) covering the fiscal period 2019 to 2021 which builds on the first savings agreement of fiscal year 2015 to 2018. The key features of the new savings agreement are as follows:
In 2014, Mayor Bill de Blasio and Labor Relations Commissioner Bob Linn committed to a respectful and collaborative labor management process, changing the dialogue with
As a result, in collective bargaining, labor and management agreed to address the issue of escalating health care costs by working together to generate cumulative healthcare savings of at least $3.4 billion over the four fiscal years 2015 through 2018, with at least $400 million for fiscal year 2015, $700 million for fiscal year 2016, $1 billion for fiscal year 2017 and $1.3 billion for fiscal year 2018.
This plan did not specify exactly how the health care savings were to be accomplished, only that it would be done by an ongoing collaborative effort between the City and its municipal unions, aimed at bending the health care cost curve for NYC health programs. For Fiscal Year 2015 and Fiscal Year 2016, the $400 million and $700 million savings goals were met. In fiscal year 2017, the $1 billion goal was exceeded by $51 million and in fiscal year 2018 the $1.3 billion goal was exceeded by $35 million. Overall, the City achieved total savings of $3.486 billion exceeding the four year goal by $86 million. Pursuant to the FY 2015 – FY 2018 Agreement, the participating unions have elected to use the excess to carry over to the next health savings agreement.
The savings initiative was accomplished using the Institute for Healthcare Improvement’s “Triple Aim” initiative as its guidepost –improving the population health, improving the patient experience of care (including quality and satisfaction) and reducing the per capita cost of care.
For information on the FY’15 to FY’18 and FY’19 to FY’21 health benefits agreement and details on how the savings are being achieved, please use the links below.