One of former Mayor Eddie Sundquist’s best policy decisions came with trying to move city retirees off of the city’s health insurance policies and onto Medicare.

The move was to save about $1.1 million a year, according to Sundquist’s 2021 budget presentation. The idea initially upset retirees, so the initiative was removed from the 2021 budget before finally being implemented after additional time was spent getting retired city employees on board. Costs associated with moving eligible retirees to a Medicare Supplement or Medicare Advantage plan, and the city then paying for the full premium of the retirees switched to those plans, was to be paid with $1.3 million of previously allocated – but not received – state Financial Restructuring Board money.

Trying to lessen retiree health care was a move worth making, but it wasn’t easy. It took the city until December 2025 to receive the state money. That means the city paid costs out of pocket, neutralizing any savings in the 2022 budget year while creating a cash crunch as the city used money from its surplus until finally receiving the state reimbursement through the Financial Restructuring Board.

One reason it took so long for the city to receive the Financial Restructuring Board money is deadlines were missed in filing for the reimbursement, which led to an additional two years of work to close out the retiree healthcare changeover. As a new group of Democrats – many of them political neophytes – come into office in January it will be interesting to see if they have new, potentially workable, ideas to help address the city’s cost structure or to bring in new revenue.

It’s also important not to let the headache involved with securing the Financial Restructuring Board reimbursement keep the city from thinking big when it comes to restructuring its operations. The city should learn from it, but the desire to examine even the most drastic of cost-saving measures shouldn’t be abandoned because it took so long to be reimbursed for money it spent up front to lessen its overall retiree health insurance bill each year.

Further erosion of the city tax base, rising costs to provide services and revenues that aren’t keeping pace with cost increases mean the city budget will be difficult every year. That won’t change unless we change the city’s cost structure. All city services should be examined with an eye toward how things can be restructured in an effort to lower tax bills and, possibly, to improve services.

That’s the biggest lesson to be learned from the city retiree health insurance project.