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Salary vs. Benefits: How Peer Towns Split the Cost

Average teacher salary, employer health insurance, and estimated total compensation for eight Massachusetts towns. Source: MA DESE, GIC rate sheets.

Marblehead pays 83% of employee health insurance premiums. Hingham pays 50%. On a family plan at FY26 rates, that difference costs Marblehead roughly $12,700 more per employee per year. So how does Hingham attract teachers while asking them to pay half their own insurance? The short answer: higher salaries.

Average Teacher Salary

Average teacher salary from DESE end-of-year financial reports (school year 2023-24). "Town pays" column shows the employer's share of health insurance premiums, from GIC rate sheets and PEC agreements compiled in data/peer_premium_splits.csv. Sorted by salary, descending.

Hingham has the third-highest average teacher salary among these eight towns despite paying the lowest share of health insurance. Marblehead has the third-lowest salary despite paying the highest share. The gap between them is $16,413 per teacher, or 18%.

This suggests the premium split is not free money for either side. Hingham's lower insurance share appears to be offset by higher salaries, negotiated through collective bargaining. From the employee's perspective, a Hingham teacher earning $16,413 more in salary but paying roughly $12,700 more in premiums (on a family plan) is still approximately $3,700 ahead in take-home pay, plus a higher pension base.

Estimated Total Compensation

What does the full picture look like when you add the employer's health insurance cost to salary? The chart below estimates total compensation for a teacher on the GIC Harvard Pilgrim family plan, applying each town's modal employer share to the FY26 full premium of $38,562.

Estimated total compensation = average teacher salary (DESE, school year 2023-24) + employer share of GIC Harvard Pilgrim Access America family plan ($38,562 annual full cost, FY26). Employer share percentages from data/peer_premium_splits.csv. Sorted by estimated total comp, descending. Not every employee enrolls in a family plan; individual plan premiums are roughly one-third of family.

The ranking shifts when employer health costs are included. Hingham drops from third in salary to fifth in total compensation. The gap between Marblehead and Hingham narrows from $16,413 in salary alone to $3,688 in estimated total comp. Marblehead's 83% of $38,562 is $32,006 in employer health cost; Hingham's 50% is $19,281. The $16,413 salary gap is partly offset by a $12,725 difference in employer insurance cost.

Marblehead's and Brookline's health insurance segments are the same width: both towns pay 83% of premiums. The entire $31,633 difference in total comp between them is salary.

What about pension costs? Higher salary also increases pension obligations. But for teachers specifically, the employer share of pension costs is funded by the Commonwealth through the Massachusetts Teachers' Retirement System (MTRS), not by the town. A town that pays teachers higher salaries does not pay higher pension costs as a result; the state absorbs that increase. Shifting teacher compensation from insurance to salary does not create an offsetting pension cost on the town's budget.

For non-teacher municipal employees (police, fire, DPW), pensions are funded through the local retirement system, and higher salaries do increase the town's annual pension appropriation. The teacher-focused comparison here does not carry the pension cost implication that would apply to a broader municipal workforce analysis.

But Does It Cost More Overall?

If Hingham pays higher salaries, does the town spend more per student? Not by much. Per-pupil expenditure for these same eight towns:

Total per-pupil expenditure (all funds) for FY2024, from DESE. Includes in-district and out-of-district spending divided by average pupil membership (FTEs). Sorted by per-pupil expenditure, descending.

Marblehead and Hingham spend nearly the same per student: $21,972 vs $21,837, a difference of $135 or less than 1%. Despite very different salary and benefits structures, the total cost per student converges.

The Growth Rate Question

Even if total compensation is similar today, the composition matters over time. Teacher salaries typically grow at 2-3% per year through contract negotiations. Health insurance premiums have been growing at 8-11% in recent years. A town that puts more of its compensation into salary and less into insurance has shifted its cost into the slower-growing bucket.

The gap widens further for part-time employees. A 20-hour-per-week employee earns half the salary but is typically eligible for the same health plan. At Marblehead's 83/17 split, the town still pays roughly $24,900 toward a family plan for someone earning $45,000. At Hingham's 50/50, the town pays $15,000. The insurance cost as a share of total compensation is far higher for part-time workers, and the premium split has a proportionally larger effect.

This does not mean Hingham's approach is necessarily replicable. The 50/50 split was negotiated through collective bargaining under M.G.L. c.32B, and restructuring Marblehead's 83/17 agreement would require the Public Employee Committee's consent. Whether employees would accept higher premiums in exchange for higher salary depends on workforce demographics, risk tolerance, and the specifics of any proposed trade. These are open questions.

What We Still Don't Know

This comparison uses publicly available DESE data, which covers teachers only. It does not include non-teaching municipal employees (police, fire, DPW), who are also covered under the PEC agreement. A complete picture would require:

• Total municipal payroll per employee (not just teachers) from DOR Schedule A data, where the pension cost trade-off is a real town expense
• Actual plan enrollment mix: the total comp estimates above assume a family plan, but employees on individual plans have a much smaller insurance component
• The history of Hingham's PEC agreement: when the 50/50 split was established and what was traded for it
• Hiring and retention data: vacancy rates, time-to-fill, turnover
• Whether Hingham's higher salaries are a direct result of the premium split negotiation or reflect other factors (cost of living, tax base, bargaining history)

If you have access to any of these data points, open an issue.