New Year’s Surprise: NYC Council Member De La Rosa Introducing Bill to Help Push Retirees Into Medicare Advantage
NYC Municipal retirees last rallied against the city’s campaign to push them into a for-profit, privatized Medicare Advantage plan on December 21. More rallies are slated for this week as a pro-Medicare Advantage bill is introduced in the City Council. Photo by Joe Maniscalco
By Bob Hennelly
New York City Council Member Carmen De La Rosa, chair of the Council’s Civil Service and Labor Committee, will introduce a bill to change the city’s Administrative Code that’s been sought by Mayor Adams and the Municipal Labor Committee [MLC] to clear the way for its 250,000 retirees to be enrolled in a for-profit, privatized Medicare Advantage plan.
The Adams administration and the MLC claims time is of the essence because its Health Stabilization Fund, created in 1984, and used to cover healthcare obligations and help defray premium costs, is running out of money.
Retiree groups, including the New York City Organization of Public Service Retirees, maintain the change will undermine retirees existing coverage in terms of cost and access to vital care, and is fighting it.
The group has already told its members in a blast email to mobilize at City Hall on Jan. 4, 9, 10, and the 19 in protest.
“They are creating a situation where they are going to introduce this with as little time for response and reaction from the public as possible,” said Marianne Pizzitola, a retired FDNY EMT, and president of NYCOPSR. “Evidently, the way they are trying to ram this through without a truly deliberative process is a scandal in itself.”
Municipal retirees are also pushing for a Blue Ribbon panel to consider some $325 million in potential healthcare cost savings the group has identified.
The next stated meeting of the whole City Council is scheduled on Jan. 4 at Noon when sources say the bill will be introduced.
The battle over the change to the Administrative Code has divided the Municipal Labor Committee. While the heads of District Council 37 and the United Federation of Teachers — the city’s largest public unions — support the change — the Uniformed Firefighters Association, Uniformed Fire Officers Association, DC 37 Local 2507, representing EMS, Local 1 Plumbers, NYC Local 294 Laborers, as well as the Professional Staff Congress-CUNY have all opposed it.
In a text exchange over the holiday weekend, De La Rosa would not confirm that she was sponsoring the measure, but acknowledged she was already “getting a ton of emails” on the issue. Over the weekend, the Council website posted notice of the Jan. 9 Civil Service and Labor Committee meeting with the only agenda item listed as the change to the Administrative Code.
The ongoing debate is an outgrowth of last year’s blowback from a coalition of municipal retirees against then-Mayor Bill de Blasio and the Municipal Labor Committee’s proposal to shift retirees to a privatized Medicare Advantage program in hopes of realizing a $600 million savings which was supported by Mayor Adams. The NYC Organization of Public Service Retirees countered the move threatened retirees’ continuity of care, would cost more, and would cover less as providers would squeeze more profits out of the conversion.
The New York City Organization of Public Service Retirees successfully challenged the city in court bringing the implementation of its Medicare Advantage plan to a standstill at the start of the Adams’ administration. Tens of thousands of city retirees opted out. One key issue was a requirement that city retirees who opted out of the new offering would have to pay a $191 monthly premium for their old plan. Subsequently, the two health insurance companies fronting the controversial plan withdrew.
That court decision for the retirees was upheld on appeal.
The MLC’s proposal for Medicare Advantage evolved from a series of agreements it had reached with the de Blasio administration starting in 2014 to find hundreds of millions of dollars in healthcare costs savings. In 2018, City Hall and the de Blasio administration executed a deal to find $1.1 billion in healthcare savings over a 3-year period. The collaboration between management and the MLC included the creation of a Tripartite Health Insurance Committee chaired by Martin Scheinman, who would act as the arbitrator over any disputes that arose out of implementation of the Committee’s initiatives.
In an October 28 letter to Municipal Labor Committee chairman Harry Nespoli, Office of Labor Relations Commissioner Renee Campion wrote that unless the Council passed the change to Administrative Code 12-126 by Nov. 4, the Adams administration “would seek relief” from mediator Scheinman, to order a change that would also comply with a standing order from the state judge that the city continue to provide retirees a single health insurance plan without a premium option.
“The City continues to lose $50 million a month for every month this plan is delayed, putting our shared goals in significant jeopardy,” Campion wrote. “We must move forward with the MAP plan in any way that we can, as quickly as we can.”
On Dec. 15, in what Scheinman captioned an “award” and “decision”, the arbitrator said the city had to follow through with a Medicare Advantage provider by Jan. 9, 2023, with a plan to take effect July 1, 2023.
“He said that failing this action, he would be compelled to identify other sources of health care savings for the City, possibly including charging monthly premiums for all active employee health coverage,” according to a newsletter to members from the Professional Staff Congress, which represents 30,000 CUNY faculty and staff. “Finally, he said that if the City Council does not immediately change the NYC administrative code governing the provision of health benefits, MA [Medicare Advantage would be the only program made available to retirees and their dependents.”
Marianne Pizzitola, head of the NYC Organization of Public Service Retirees & FDNY EMS Retirees, says that the Scheinman filing is nothing more than his opinion without the weight of law.
“He has absolutely no jurisdiction over this, although everyone believes because of some media errors as well as the MLC, DC37, UFT, putting this out as this is a decision by the arbitrator,” Pizzitola said on WBAI Jan. 2. “This isn’t a decision; he actually states this is his recommendation. If you go back to the originating document, he only has certain jurisdiction — this is not one. This is strictly his opinion and the city doesn’t have to agree with it. It surely is not binding. It is not binding on the City Council, and it sure as heck, isn’t binding on the retirees.”
Sarah Shapiro, a retired UFT educator and member of the Cross-Union Retirees Organizing Committee, agrees.
“From what we understand, he would only have jurisdiction if there was some sort of deadlock between the parties,” she says. “The MLC and the Adams administration are in agreement — so there’s no basis for Scheinman to weigh in. As our lawyer Steven Cohen describes, this is not a ruling — and it’s not binding.”
The retiree groups opposing the switch to Medicare Advantage maintain that the finances of the Health Stabilization Fund finances were undermined when the de Blasio administration used roughly $1 billion from it in order to fund raises for the United Federation of Teachers that had to stretch back to 2009-2010 because the union had been unable to close a deal with Mayor Bloomberg for several years.
The UFT, under the leadership of President Michael Mulgrew, denies that charge. A UFT FAQ for members states: “When the city and the MLC agreed in 2014 to use funds from the stabilization fund to help pay for salary increases for all city workers between 2015 and 2018, the funds that were drawn down were completely offset by $1 billion in cost-saving measures in health care that the union and city worked together to generate over that same period,” the UFT information sheet maintains. “Not a single health care benefit was either lost or diminished during that three-year period as a result of these cost-saving measures. In fact, some health care benefits were enhanced.”
The UFT FAQ continues, “The skyrocketing cost of health care has depleted the stabilization fund and is making it difficult to keep current health care plans sustainable.”
The Adams administration had originally imposed a Nov. 4 deadline for the New York City Council to approve the revision of the administrative code but had not up until very recently had a Council sponsor. Currently, there’s are no additional members of the City Council listed as sponsors.
“This is such a complicated issue right now,” City Council Speaker Adrienne Adams told reporters at a Nov. 3 press conference. “Right now, we are still discussing it and we are still receiving briefings — I kid you not — on a daily basis regarding this very, very critical matter. So, it’s under consideration. I can’t really share very much with you today because we are still being briefed on it as we speak.”
Several Council Members from across the political spectrum were willing to go on the record opposing any change in the Administrative Code over worries about the potential impact on the city’s 250,000 retired civil servants who often live on tight fixed incomes.
“I have yet to understand why we would take a good law that protects labor and change it to somehow protect labor when retirees are going to end up paying $2,400 a year,” said Council Minority Leader Joe Borelli, (R-Staten Island). “We have retirees in this city whose monthly pension and social security income amounts to a few thousands of dollars a month at best. This is a significant hit or it’s a loss of a good health plan.”
Brooklyn Council Member Charles Barron, (D-Brooklyn) said he was “100 percent with the retirees…because I think they have to keep the commitment they have because it’s beneficial for those who paid their dues and I think the Medicare Advantage approach is privatizing. It’s not benefiting those who sacrificed their lives and did all this study during the pandemic. I think it is a damn shame that we have a mayor that can’t see that.”
In recent months, the New York Times and Kaiser Health News have published major investigative reports flagging significant issues with the Medicare Advantage private insurer model.
“Medicare Advantage, a private-sector alternative to traditional Medicare, was designed by Congress two decades ago, to encourage health insurers to find innovative ways to provide better care at lower cost,” reported the Times. “If trends hold, by next year, more than half of Medicare recipients will be in a private plan.”
The newspaper reported that in “a survey of dozens of fraud lawsuits, inspector general audits and investigations by watchdogs” showed “how major health insurers exploited the program to inflate their profits by billions of dollars.”
“Medicare advantage plans gives private insurance companies the power to overrule primary care physicians — and to say which procedures will be permitted,” said Manhattan Council Member Gale Brewer in a statement. “Many retirees have health care issues and work very hard to stay healthy. Keeping their current insurance plan, called Senior Care, is critical in retaining access to their doctors and ensuring continuity of care.”
Boosters of the MLC approach insist the city can create a Medicare Advantage model that benefits from the federal subsidy while protecting the affordability and continuity of retirees' healthcare.