Michael LaFaive, of the Mackinac Center for Public Policy, says that Michigan's lawmakers could save taxpayers more than $194 million a year by moving 52,000 state employees in to HSA-matched insurance policies.

Rather than tax itself into further competitive disadvantage, lawmakers in Lansing ought to pursue innovations such as making changes to employee insurance plans. Employees won't like it--nobody likes being the subject of a unilateral change--but government employment is a privilege, not a right. And if you don't like the changes, there are always plenty of other people who would be happy to have a shot at that civil service job.

Meanwhile, Mackinac Center's Michigan Education Report finds some positive reforms in the budget mess:

Legislation to lower the burden of health insurance costs for public school districts was among the many measures passed last weekend as lawmakers addressed the overspending in Michigan's budget, according to Booth Newspapers.

The legislation allows districts to now pool employees' health costs and also mandates that employers competitively bid for insurance coverage. This aspect of the bill faced the most opposition because it requires the Michigan Education Special Services Association, a third-party health administrator affiliated with the Michigan Education Association school employees union, to release claims data. Supporters say this could save millions of dollars each year, Booth Newspapers reported. Claims data will be aggregate so as to protect the identity of individual employees.

The Legislature also reformed the state's school employee retirement system. The new program will model that used for other state employees. Retired school employees will now have a percentage of their health care costs paid by the state each month. The percentage will be on a scale system and tied to how many years the employee worked, according to Booth Newspapers.