On Saturday, September 24, 2011, Governor Snyder signed Senate Bill 7, making it the law of the State.  Beginning on Jan. 1, 2012, a public employer such as a city, county or township will be limited from paying more than $5,500 for health benefits annually for a single employee, $11,000 for an employee plus spouse or $15,000 for family coverage. These amounts are tied to inflation based on the medical component of the Consumer Price Index.

Alternatively, a public employer may split the cost of medical coverage with its employees, who will have to pay a proportion of their health insurance costs. Under this option, a public employer may pay no more than 80 percent of the annual cost of medical benefits.

A local unit of government that is held to this new standard may exempt itself from these requirements with a two-thirds vote of its governing body.