Local Municipalities

In 2016, stronger city revenues built the capacity of cities to deliver critical services and improve quality of life. This trajectory of growth, however, is threatened by a number of persistent concerns, one of which requires thoughtful implementation of pension reforms and the leveraging of fiscal planning tools. As cities move to shore up healthcare and pension liabilities, the additional expenditures required in their General Funds will compete for scarce resources with other city services, confronting city leaders with difficult choices among employee and retiree benefits, city service levels, and raising new revenues.1

The financial outlook for municipalities is uncertain. Let UnitedHealthcare, with our experience, stability and market strength, help to meet your needs. We listen closely and bring customizable solutions that may fit your challenges. We bring the power of information to help you and your employees make more informed decisions, which may improve their health and well-being.

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Let's have a conversation

It all starts with a conversation. A conversation about your needs and challenges can help us propose tailored solutions.

There are a variety of ways UnitedHealthcare can help. We offer flexible and customized plans and services, with a level of personalization. After all, no one knows your employee population better than you. So let's build a benefits program together.

Some solutions to consider include:

The Statistics are Daunting

The data clearly reflects how difficult times have been the past few years. And unfortunately, it also predicts uncertain times ahead with revenue shortfalls and strained budgets expected in the near future. Here are the facts 2 :

  • During the recession, spending on employee wages – both wage levels and total municipal employment – declined sharply. Local job losses were felt most heavily in public safety, public works, public health, social services and parks and recreation. 3
  • As noted by finance officers, cities are increasing expenditures on employee wages and salary, most notably in the area of public safety. Cities have led public sector job recovery – but, despite gains, municipal employment remains more than 88,500 jobs below its post-recession peak (December 2008) of 6.5 million jobs, according to the Bureau of Labor Statistics.
  • Retiree health benefits and pensions rank among top budgetary stressors. Interestingly, health benefits and other post-employment benefits (OPEBs) only comprise about 1.5 percent of operating revenues for many local governments. 4
  • The rising costs of claims and prescription drugs combined with an aging workforce are adding budgetary pressures. 5
  • For pensions, the portion of combined state and local government spending dedicated to retirement system contributions is only about 4%. 6  The funding levels and the extent of pension challenges, however, varies considerably from city to city based on their underlying economy, tax capacity, state fiscal health, and availability of policy choices.

The solution? Let's start by working together, both the health plan and the municipality, to try to reverse these daunting indicators. Together we can find innovative, customizable solutions that will help to control government spending while keeping your employees healthy.

1. 2016 Report on City Fiscal Conditions by the National League of Cities (NLC) Center for City Solutions and Applied Research.

2. 2016 Report on City Fiscal Conditions by the National League of Cities (NLC) Center for City Solutions and Applied Research.

3. National League of Cities, National Association of Counties and U.S. Conference of Mayors, July 2010. Local Governments Cutting Jobs and Services.

4. Moody’s Investor Services, March 2015. Moody’s: Most large local governments have low retiree healthcare outlays, although outliers are present.

5. Center for State and Local Excellence and University of Tennessee, Institute for Public Service, December 2014. Local Government Strategies to Address Rising Healthcare Costs.

6. National Association of State Retirement Agencies, February 2015. State and Local Government Spending on Public Employee Retirement Systems.

For a complete description of the UnitedHealth Premium® Designation program, including details on the methodology used, geographic availability, program limitations and medical specialties participating, please see myuhc.com®.

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