Mayor Adams’ administration won a key decision Thursday in its effort to move thousands of retired New York city workers into a highly controversial privatized Medicare Advantage plan.
The decision, by an independent arbitrator overseeing the health care dispute, appears to pave the way for the administration to implement the Medicare Advantage plan as the only insurance option available to city retirees.
A local group of municipal retirees who are fighting the city’s efforts are likely to challenge the decision in court.
The Adams administration has pushed for nearly a year to enroll the city’s roughly 250,000 retirees in Medicare Advantage, which could result in up to $600 million in annual savings to the city budget, thanks to federal subsidies and a partnership with a private health insurance provider.
Officials advocating for change say the move is critical as the city braces for a projected $6 billion budget shortfall by 2026.
On the final bend, arbitrator Martin Scheinman concluded that the latest model proposed by the Adams administration would bring the city into compliance with local law.
The previous plan was rejected by the court because it would have fined retirees who stuck to the traditional Medicare plan. This violated a local law that requires the city to provide retirees with premium-free health coverage for life.
Under the new plan, the private Medicare Advantage plan administered by Aetna will be the only plan available to retirees. Without a fine in the photo, Scheinman saw that the city was following the law and could move forward.
“While I understand that change can be difficult, particularly when it comes to long-term health benefits, circumstances have evolved to threaten the sustainability of strong, premium-free benefits for working and retired people,” Scheinman said. .
“Put simply, moving to an MA (Medicare Advantage) program for city retirees is prudent, responsible, and essential,” he wrote.
Many retirees disagree.
Marianne Pizzitola, president of the NYC Organization of Public Services Retirees, which successfully sued the city over the Medicare Advantage debacle, criticized Scheinman for not involving her group in the arbitration proceedings, accusing her of “hearing the interests” of the Adams administration.
Pizzitola also said his group would likely sue the administration again if it goes ahead with Scheinman’s recommendations.
“Retirees were not part of the arbitration process, but if the city seeks to violate retirees’ rights again, retirees will again have to seek judicial intervention to protect their health care rights,” said Pizzitola, whose group argued that an Advantage plan would wipe out their health care benefits.
Medicare Advantage plans may offer lower upfront costs in some cases, but are generally more limited in terms of providers and other health care options. A recent federal study found that city retirees risked losing “medically necessary care” if they signed up for the Adams administration’s preferred plan, under which about 13% of denied claims would have been covered by the traditional health insurance.
United Federation of Teachers President Michael Mulgrew, who is vice-chairman of the City Labor Committee, which supports the Adams Advantage push, pointed Thursday to rising health care costs over the past decade. which, barring federal action, he said, requires negotiations with the city in the meantime.
“Most importantly, we want to maintain plans that don’t require our members to pay the thousands of dollars that most workers now have to pay for health insurance,” Mulgrew said in a statement.
“A new Medicare Advantage plan will be negotiated to maintain this premium-free status, and we will ensure that it meets the needs of our retirees, while saving hundreds of millions of dollars that will be spent on other health care services. health,” he said. said.
Thursday’s arbitrator’s opinion pointed out that there is always the possibility “that the choice will be preserved” if the city council amends the municipal statutes within 45 days to allow pensioners to join an alternative plan. So far, the Council has shown no signs that it will act on this front.
The notice gave the city and city labor committee 25 days to negotiate a deal with healthcare company Aetna.
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