Retired City Workers Bilk Memphis Out of $16.5 Million
Policy + Politics

Retired City Workers Bilk Memphis Out of $16.5 Million

Flickr/James Blucher

In Memphis, city retirees under the age of 65 who are now fully employed somewhere else are still using the Memphis public employee insurance plans, at a tremendous cost to the city – simply because they can.

Many of these pre-age 65 former city workers have opted out of their new companies’ health insurance plans, choosing instead to stay with their far more generous public worker benefits. “The coverage on their [new] jobs is not as bountiful as we have,” said Memphis Mayor A C Wharton during a news conference.

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In 2013, the city had 1,400 working-age retirees. The city spends almost $12,000 per retiree age pre-65 at a cost of roughly $16.5 million per year, according to WMC Action News 5 in Memphis, which reported this story this week. The city says there is no requirement to track which of these retirees are working other jobs.

Former head of the Memphis police department, Larry Godwin, is one of those taking advantage of the city’s health insurance largesse. Godwin collects nearly $60,000 a year in health care benefits, though he’s now working as the Tennessee Department of Safety and Homeland Security Deputy Commissioner. The mayor says someone would simply have to propose that the city track employed retirees in order for the practice to stop, WMC Action News 5 reported.

“We think that if they’re on a job where there is coverage, that that’s an option they should pursue,” said Mayor Wharton, a Democrat. “If you don't have coverage, stay right where you are.”

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Godwin’s communications director, when contacted by WMC Action News 5, responded, “While currently an employee of the State of Tennessee, Deputy Commissioner Larry Godwin made the choice to take his earned retirement health care benefits from the City of Memphis to ensure that his family would have health care coverage after his service to the State ended. The State requires employees to work for ten years before earning health care retirement benefits, and Commissioner Godwin would not be eligible for those State retirement benefits until 2021, at age 70. He currently does not qualify for either Medicare or Social Security.”

The full list of Memphis retirees, many of whom are still receiving city health insurance benefits, can be seen here.

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