KCBD INVESTIGATES: City of Lubbock struggling with dramatic rise - KCBD NewsChannel 11 Lubbock

KCBD INVESTIGATES: City of Lubbock struggling with dramatic rise in health care costs

City of Lubbock Mayor Dan Pope said health insurance costs are rising quicker than any other city expense City of Lubbock Mayor Dan Pope said health insurance costs are rising quicker than any other city expense
The City of Lubbock spent roughly $7.8 million on city employee retiree health insurance benefits The City of Lubbock spent roughly $7.8 million on city employee retiree health insurance benefits
LUBBOCK, TX (KCBD) -

Lubbock Mayor Dan Pope says health insurance costs are rising quicker than any other expense the city has.

So it may surprise you to learn that the city continues to cover its employees and subsidize the cost of their health insurance when they retire.

Mayor Pope said the city spent nearly $8 million on retiree health insurance costs in 2016; it is an expense your property taxes help cover.

"Last year, our revenues were up quite a bit," Mayor Pope said.

Mayor Pope said in the city's business, that is tax revenue generally driven by property taxes.

"Because of our growth and annexation last year, they grew a little over three percent," Mayor Pope said.

Mayor Pope said that is a pretty high number for the City of Lubbock, but not quite high enough when compared to the 10 percent increase the city saw in healthcare costs last year.

"So, more than three times as fast as our revenue," Mayor Pope said.

The money you pay in property taxes goes into the general fund, which sits at roughly $175 million.

The mayor said about $30 million of that pays for city employee healthcare costs and $7.8 is spent on health insurance benefits for retirees.

"It's a big piece of the budget. I'm not sure we've done a good job with keeping up with the marketplace," Mayor Pope said.

Mayor Pope said the city requires eligible retirees to enroll in Medicare, but that is typically not their first stop when seeking help with coverage.

"They need to be going to Medicare first and then coming to us second. We should be the reinsurance for that, that is typically how a plan like this works. I am not sure we have done a very good job of that," Mayor Pope said.

So what does the future of healthcare look like for city employee retirees?

"To do something drastic and run off good people would not be the right thing to do; however, we do need to make sure we are making changes," Mayor Pope said.

For example, he said health savings accounts could become an option for city employees.

He said the city will work on a plan through the spring and employees could start seeing changes implemented in the fall.

Copyright 2017 KCBD. All rights reserved.

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