Senate President Therese Murray on Tuesday confirmed that the Senate budget proposal due to be released on Wednesday will include a version of municipal health care reform, but declined to offer details.

Speaking to the Retired Educators Association of Massachusetts, Murray blamed rising health care costs for putting an “enormous burden” on cities, towns and businesses, forcing layoffs and higher fees and taxes.

“The House recently passed a measure on this issue, and the Senate will advance its proposal tomorrow,” Murray told the group of about 50 retired educators who were in the State House to lobby for legislation increasing the base upon which cost-of-living adjustments are calculated.

"For the last two years the Senate passed municipal health plans that were met with resistance from both the unions and the House and they didn’t move, so tomorrow there will be another option,” Murray said.

Proponents of municipal health reforms say changes are needed to help cities and towns collectively save roughly $100 million, savings that lawmakers claim will help offset another cut in local aid scheduled for next fiscal year.

By following the House and including muni-health reforms in its annual budget bill, the Senate will bypass the joint committee process. Members of the Public Service Committee held a marathon hearing on the issue this year but have not recommended legislation and the issue appears headed for resolution through the budget process instead.

The House, in its budget proposal approved last month, passed an initiative that would strip municipal unions of significant bargaining power over the design of their health care plans, including the levels of co-payments and deductibles for employees and retirees.

“Those on fixed incomes have limited discretionary dollars and will be unduly harmed by this cost shifting” in the House plan, said John Hassan, president of the Retired Educators Association of Massachusetts.

“The plan we have will protect retirees and also ensure them a voice in any negotiation process,” Murray said.

Unions lambasted House members after their vote for failing to protect collective bargaining rights and union leaders turned their attention to the Senate with hopes of obtaining more favorable language.

The Senate has twice passed proposals that preserved more bargaining power for unions that the current House plan, leaning on binding arbitration as a way to break impasses between unions and management.

Asked after her remarks whether the Senate plan would differ significantly from the House plan or past Senate proposals on municipal health, Murray said: “You’ll have to wait until tomorrow.”

Murray did, however, say the Senate is aware that unless the Legislature addresses comprehensive payment reform to lower the cost of health care, the debate will continue to be an issue for years to come.

“We can no longer afford to have our municipalities reducing services, laying off and raising fees and taxes to balance their budgets, and let’s not forget during this process that the underlying issue is the continuing growth in the cost of health care,” Murray said. “So unless we address the sustainability of health care for everyone as the Senate wants to do with payment reform legislation and the governor has filed we will be back here every year having this same discussion.

The Senate Ways and Means Committee is scheduled to vote on its fiscal 2012 budget bill at 11 a.m. Wednesday.