City of Industry Leads the Way in Soaring Healthcare Costs

Transparent California has now collected over 2.5 million salary and benefit records for 2020. One of the most recent uploads was for the City of Industry in Los Angeles County. The upload of this city uncovered some appalling data on the costs of health benefits given to their public employees, and for comparison, led to some revealing statistics about health benefits up and down the Golden State. 

Per the State Controller’s website, it was found that over 40% of 36 employees on staff for the City of Industry receive $30K or more in health benefits for the 2020 calendar year.  The city, which as of 2017 was estimated to have only 440 people living within its limits, had an average healthcare cost of $22,455.06 (measurement limited to employees that had costs paid for by the City, 30 total employees). Adjusting to the median to account for outliers, the cost comes out to be higher at $26,987.00.  

The City of Industry’s average cost was the highest in all of California for 2020. Looking at aggregated 2020 data from the entire State Controller’s database for 2020, we see The City of Industry was not alone in terms of egregious healthcare spending in 2020. Twelve other cities in the Golden State had average costs (measuring employees that had costs paid for by the employer) above $20k, and 108 had average covered costs above $15k. For comparison, the median average cost spent by a city in California in 2020 was $11,890. Statewide, if all cities above the median were to adjust to the median healthcare costs, California taxpayers would be saving close to $400 million. 

In California, it seems like the default solution to many of the pressing problems the state is facing is to raise taxes and/or spend more money. Quite often this is seen at the ballot box in November when in addition to Federal, State, and Local candidates, voters are asked to mark their selections on a laundry list of ballot initiatives, referendums, and sales tax propositions that propose throwing more public funds (and thus potentially the pocketbooks of everyday people in California) at some of the biggest problems facing the state. However, how often do we hear discussions taking place about overhauling public employee benefits? 

Government healthcare reform in California can be accomplished. As was noted in our blog in 2019, the Central Contra Costa Sanitary District was paying lavish health benefits in 2018. Data from the State Controllers website shows over 51..yes, 51!…public employees, were receiving over $50K in health benefits! A couple days after this was highlighted in our blog, the Sanitary District decided to implement a change to it’s ridiculous healthcare costs, saving the taxpayers $5.8 million dollars per year.  

Looking at this from a regional perspective, other comparable municipalities (when measured by employees that had costs paid for by employer) in Los Angeles County can provide healthcare to city employees at significantly lower costs. The average cost for covered employees in the cities of Walnut (36 measured employees) and Artesia (34 measured employees) was close to $9500 for 2020. La Canada Flintridge (29 measured employees) managed to do so at an average cost of $8073.   
 

Why is the overhauling of public employee benefits never more widely discussed in the Golden State?  Instead of asking voters every 2-4 years to vote on a litany of bond measures and sales taxes raises to fund governmental services, more public discourse should be happening on limiting the benefits of public servants.  

As always, you can learn more about how California governmental entities are spending taxpayer dollars at TransparentCalifornia.com. Find info on school boards, city councils, and all levels of California government. Be sure to “subscribe” so you can be aware when new data put on the website!  We just started collecting 2021 data, and new information is being uploaded every week! 

Joshua Lozancich graduated from the University of Minnesota-Morris with a BA in Political Science. As someone who spent most of his life living in California and is familiar with some of  the major problems the Golden State faces, he is looking forward to turning TransparentCalifonria.com into a vital resource all Californians can use to help create a brighter future for the state.