The new health insurance plan proposed by unions representing city employees will not fix the city’s long-term problems or even be ready in time for employees next year, according to Memphis Mayor A C Wharton.
The Memphis City Council passed changes to the employee health benefit plan last month. Those changes were part of Wharton’s 2015 budget and were designed to save more than $24 million, which would be put toward the city’s underfunded pension system.
The plan increased employees’ premiums by 24 percent, cut some of their spouses from the program, cut a 70 percent subsidy the city paid toward retirees’ health care insurance, and more.
Employees’ unions proposed a high-deductible insurance plan to the city’s health oversight committee a few weeks ago. The unions said that plan would save about $24 million, keep retirees’ subsidies, keep premiums where they are now, and keep spouses on the city’s health plan.
Wharton administration officials asked Mercer, a benefits consulting firm, to run the numbers on that plan. The company said the plan would not save enough money and could not be implemented by a January deadline.
The results of the study were delivered to the council’s Personnel & Intergovernmental Committee Tuesday.
Memphis Police Association president Mike Williams said he didn’t necessarily like the plan proposed by his organization and the Memphis Fire Fighters Association. But he said coming back to the table shows the groups are willing to compromise, something he said the Wharton administration is not willing to do.
“They made no effort whatsoever to help us change our plan or even meet us halfway,” Williams said.
Williams then suggested the council bring in an independent consultant to review the unions’ health insurance proposal, much in the way the council sought independent counsel on the city’s pension system
The proposal will come back to council for a further review in two weeks.
