Bill
HB 6058
Public employers must cover at least 80% of medical plan costs starting 2025, with higher annual caps and phased increases per covered employee.
Status & source
- Amends the Publicly Funded Health Insurance Contribution Act (2011 PA 152), modifying MCL 15.563 et seq.; adds sections 3a and 4a.
- Introduced (Nov 12, 2024); passed House (Dec 13, 2024) and Senate (Dec 20, 2024); bill ordered enrolled Dec 23, 2024. Referred to Joint Committee on General Law (Jan 22, 2025).
Purpose
- Increase the allowable employer contribution caps for publicly funded medical benefit plans and convert the prior 80% “cap” option into a required 80% minimum employer contribution for most public employers beginning Jan 1, 2025.
Key provisions
- New contribution limits (effective for coverage years beginning Jan 1, 2025):
- Single-person: $8,258.54 per covered employee.
- Individual‑and‑spouse or individual‑plus‑one (nonspouse dependent): $17,271.17 per covered employee (see phased multipliers below).
- Family: $22,523.34 per covered employee.
- Annual adjustments (state treasurer):
- By April 1 each year beginning 2025, adjust single and family amounts based on the change in the medical care component of the average Michigan health insurance rates (approved by DIFS) or by 3%, whichever is greater.
- Individual‑and‑spouse (or plus‑one) is set as a multiple of single coverage:
- 2026: 2.2 × single
- 2027: 2.3 × single
- 2028 and after: 2.4 × single
- 80% requirement:
- For coverage years beginning Jan 1, 2025, public employers must pay at least 80% of total annual costs of the medical benefit plans they offer or contribute to (includes premiums and employer reimbursements for copays, deductibles, HSA/FSA contributions).
- Previously the law allowed employers to elect to pay up to 80%; HB 6058 makes 80% a minimum (floor) for applicable employers.
- Collective bargaining and contracts:
- Existing collective bargaining agreements or other contracts inconsistent with the new provisions remain in effect until amended or until their stated expiration; expenditures under such contracts are excluded from calculations until they expire/amend.
- Any collective bargaining agreement or contract executed on or after Jan 1, 2025 may not include terms inconsistent with the 80% minimum.
- Allocation: Public employers may allocate contributions among employees and elected officials as they choose.
- Exclusions: Provisions for the new caps/adjustments exclude offers based on the federal Affordable Care Act or other federal/state‑sponsored plans.
Who is affected
- Broadly affects public employers in Michigan: the State; counties, cities, townships and other local units; school districts and public school academies; community colleges and higher education institutions; and their employees and elected public officials.
- Local units may still be subject to existing opt‑out rules in the underlying statute (varies by entity type).
Fiscal impact / expected effects
- Converts an 80% cap into a required 80% minimum for many employers — likely increasing employer health benefit spending where current contributions are below 80%.
- Sets new dollar caps that are higher than prior published caps for 2025 ($8,258.54 single vs prior ~$7,718), with automatic annual increases.
- House Fiscal Agency examples: for the state in CY2025, state contributions per participant approximate current 80% levels (e.g., ~$7,335 single; ~$22,006 family). The agency estimates each one‑percentage‑point increase in employer contribution raises state costs roughly $5–7 million annually (about half to the general fund) — precise total statewide cost not estimated.
Effective dates / timing
- Contribution floor and new dollar limits take effect for medical benefit plan coverage years beginning on or after Jan 1, 2025.
- State Treasurer adjustments required annually by April 1 for the succeeding coverage year.
Notes
- The bill retains employer flexibility to allocate benefits among employees and to negotiate higher contribution levels with bargaining units (with certain concurrence rules and transitional percentages allowed in early years).
Compiled from official sources — confirm details with the bill’s official record.
Sign in to ask a question.
