Sen. Gary Peters Forces Michigan Taxpayers To Pay For His Cadillac Health Insurance

Peters opts out of Obamacare to remain on now-defunct health plan that costs Michiganders millions

Sen. Gary Peters (D., Mich.) / Getty Images
October 5, 2020

Sen. Gary Peters (Mich.) is campaigning on his support for the Affordable Care Act, but the Democrat opted out of Obamacare coverage to remain on a controversial plan that forces his state's taxpayers to foot the bill for his Cadillac health benefits.

Peters does not participate in the gold-level Obamacare policy available to all members of Congress, according to his financial disclosures. Instead, he participates in the Michigan Legislative Retirement System—a taxpayer-funded health care program that lawmakers reformed after public outcry about its multimillion-dollar costs.

The program covers 90 percent of the health care premium costs for retired Michigan legislators such as Peters, a state senator from 1995 to 2002. It's much better deal than Congress's Obamacare benefits, which only cover 72 percent of the cost for premiums. A bipartisan group of Michigan lawmakers abolished the program in 2011 after taxpayers took issue with its multimillion-dollar costs.

Even as Peters opted out of Obamacare, for which he voted in 2011, he has defended and even called for expanding the program on the campaign trail.

"We should open up the enrollment of the Affordable Care Act now so that people who may not have health insurance have the opportunity to have that peace of mind now," he said in a virtual campaign event in July.

The Peters campaign did not respond to a request for comment.

The generous retirement plan was available to any former Michigan lawmakers over the age of 55 who served six years in the state legislature. It received considerable public criticism, prompting almost all Democrats and Republicans to vote to abolish it for future generations of lawmakers in 2011.

Jack McHugh, a senior legislative analyst at the Michigan-based Mackinac Center, said the retirement plan's unpopularity with voters made it a "political football" between Democrats and Republicans, prompting the bipartisan reform.

"The public was putting the pressure on, legislators were responding," McHugh told the Washington Free Beacon. "[The public] said, 'You guys are getting something Joe Citizen isn't getting and that's not fair.’"

The reform sought to phase the plan out gradually. As a result, Peters and 263 other ex-legislators who served before the 2007 cutoff date are still participating in the taxpayer-funded program. It cost Michiganders more than $5.3 million in 2019 alone.

Peters is fighting to keep his Senate seat against John James, a West Point graduate who mounted a competitive 2018 race against Sen. Debbie Stabenow. Peters has a 3.8 point lead over his rival, according to an average of polls compiled by RealClearPolitics.