City of Memphis Health Insurance Plan Update

Yesterday I posted a short piece about how certain retired city employees will be losing their premium subsidies from the City in January.   I understand that the City Council has passed a resolution to provide about $2,000,000 as a safety net for these retirees.  The resolution gives the City administration 60 days to come up with a plan for what to do with the money.

If you are a retired city employee you may be wondering if this will be enough money to make a difference.  Here is a link where you can find a summary of 2015 City Budget.

According to the budget summary, there are 1,100 retirees over 65 who don’t have Medicare.  They will continue to receive their subsidies and are not affected by the cuts.

There are 2,900 retirees (both over and under age 65) who will be losing their subsidies as of January.
The subsidy is worth about $450/month for each retiree (click here to see the rates for each retiree).  To determine the total value of the subsidies we multiply 450 x 2,900 x 12.  This works out to $15,660,000.
I don’t know how the City Administration plans to allocate these funds; however, $2,000,000 will not be enough to make up for the loss.
If you are a retired city employee and want some help planning for next year, please feel free to give me a call at 901-763-2021.

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