Republican Gov. Rick Snyder's administration is considering partnering with the federal government to run a health insurance exchange because Michigan is running out of time to set up its own if the U.S. Supreme Court holds up one of the key provisions of the federal health care overhaul.

A budget deal was reached that will put $130 million toward school employees' future retirement health care costs.

The money may be set aside in case the state loses legal fights over collecting income taxes on public pensions or having state workers pay more of their pension costs.

Increases to taxes on individual retirement income are expected to total $1.4 billion, while business tax cuts will total about $1.9 billion.

Hundreds of active and retired teachers and other school employees crowded into a Senate hearing Wednesday to voice concerns that proposed changes to their retirement benefits would unfairly push more costs onto them and even drive some out of education.

A retirement committee is considering a bill under which all school employees would continue to pay at least 3 percent of salary toward retiree health care.

Detroit faces a $200 million budget deficit and could run out of cash by May, raising concerns for its liabilities for pensions, health care and bonds.

Michigan employers are likely to save money on unemployment insurance and worker's compensation under changes signed into law Monday by Gov. Rick Snyder. Critics, though, said the moves could make it more difficult for injured and jobless workers to get the benefits they need.