City Drops Health Coverage for Employees
Due to a budget shortfall, Lexington’s Urban County Government is dropping health insurance coverage for 556 employees of “outside agencies”. These are organizations that are connected with, but not directly run by, city government. In reference to 2008 spending, reducing employees of the 20 organizations from Lexington’s insurance plan would save the city $506,218 a year.
“The satellite agencies had been paying only their premiums,” said Susan Straub, spokeswoman for Mayor Jim Newberry. “… They were not funding the full cost of their health care.”
This plan of dropping health coverage was actually initiated last November. That time, Newberry said that the city might consider layoffs, pay cuts, furloughs and the elimination of city programs to hold back an estimated deficit of $12 million to $13 million. City government division directors were asked to propose plans to cut expenditures by 5 percent.
The city council has approved this cutting of health insurance coverage for outside groups on Dec. 8. In all, the city offers health insurance to 3,622 workers and retirees, whose health claims outpaced revenue by $8.5 million last year.
All agencies affected should have found new health care plans by now as they were given only until Dec. 31, 2010 to do that.
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