NYC Retired Workers, Including Police, Fire, EMS, Who Are No Longer Voting Union Members, Being Forced Into Inferior Healthcare Plans To Save NYC Money, At Cost Of Contractual Obligations
Marianne Pizzitola, of the NYC Organization of Public Service Retirees, sat down with Staten Islander News Organization to provide an update on the healthcare issue for retired City workers. The Aetna plan that the City is trying to force all retirees into is not the same as the previously available MediGap plan, as they are known. A MediGap plan covers the 20% of bills that Medicare itself doesn’t cover.
These plans have a low cost per retiree, of around $200 per month. You may or may not know that Medicare pays for most of the healthcare that retired persons need, even those who have developed health problems later in their lives. But Medicare doesn’t pay for all of it. That is where the MediGap plan comes in.
The contract between the City of New York and its Union workers is that the City will pay the full cost of healthcare for every Union member, as well as for their dependents, up to the benchmark known as the HIP/HMO benchmark. Active union members have multiple plans to choose from for their healthcare while they are employed, and the retired workers also had a number of plans to choose from, including those which are Medicare Advantage plans.
These supplemental plans fill in the gap that is left after Medicare pays for what they cover for each person on Medicare. For the most part, people don’t want to enroll in these Advantage programs because there aren’t as many doctors in their network.
In preparing for the case that just recently received a decision in favor of the retirees (place link here), they have been asking the City retirees to ask their doctors if they accept this plan. Most of the doctors who have been asked have said they do not accept the plan, or any Medicare Advantage plan.
The Doctor Is No Longer Able To Provide You With Care You Need, As Insurance Company Acts As Gatekeeper To Needed Treatments
The Medicare Advantage plans are an advantage to the insurance companies. They are insurance plans that are run by private for-profit companies, and they are a plan that seeks to maximize profits. Many private insurance companies are all about profiting and saving money, just as any other for-profit business is.
These companies are now able to provide these Medicare Advantage insurance plans that delay and deny all types of healthcare, instead of the traditional MediGap plan. If a doctor orders a person to get a treatment, and it should be covered, the insurance companies will in many cases still deny the claims. Weekly calls are often necessary in these private insurance plans, and often even this does not help to get them to pay valid claims.
With many covered items, a prior approval is needed, and when this happens, the insurance company will often delay and deny care to the insured person for as long as possible. If someone does not have the time or energy to devote to contacting the insurance company and essentially pestering them, their care will be denied, and it won’t be paid for.
Many physicians do not accept these types of plans for a very simple reason: they would have to hire a full-time person just to keep on top of the insurance companies who deny the care they provide. For many doctors, it is easier to just not accept the plan.
The City Wants To Force Retirees Into A Much Smaller Number Of Health Insurance Plans That Are Only Medicare Advantage Plans, In Order To Give Current Workers Raises, Make Up For Misuse Of Funds For Active Workers’ Healthcare Over Time
In order for the City to raise money, they have been approached by Aetna with a plan for retirees that is being sold as superior, but it is actually inferior. The City has been responsible, under the Union contract and other regulations, for paying the health insurance costs of all active employees, retired employees, and their dependents. This is one of the main reasons why a lot of City workers over the years have chosen to work for the City.
In most instances and in most positions, a city or municipal job does not pay as well as its private, for-profit counterpart. Many private companies offer a better salary, better vacation time, and other perks that make working for the City in many instances a financial sacrifice. However, people have often chosen this field for many reasons, including serving the members of their community. But in many cases, what made the choice easier was that when you were retired, your healthcare would be taken care of.
In all ways, the City is now reneging on this promise that was made to the workers at the time. The City is forcing every retiree into a small number of Medicare Advantage plans only. These plans are not accepted by a large number of their doctors, and Marianne has been fighting this for three years. It all started when they read about it in a local newspaper story.
Now, they have three lawsuits that are active. The expenses for the retirees, who are all living on fixed pensions, will be difficult to maintain for the length of time that may be necessary. All to defend what they earned and what they were promised, and it is a process that is very expensive. The City has very deep pockets. They can afford to appeal to every level of court. At every turn, there is a possibility that a judge will rule against the workers. This is an ethical issue as well, since if the City will diminish a worker’s healthcare after they have retired, then why would someone sacrifice so much in order to have it taken away after the fact. As stated before, the rising costs of healthcare is one of the main reasons that municipal workers chose lower paying jobs: to get better healthcare when it would be needed most.
If retirees want to choose a Medicare Advantage plan, they should be able to do so. Some active workers, and even some retirees, have chosen these plans, both currently and in the past. However, the alternative plans they have provided for decades should be kept in place. This is the main argument of the lawsuits.
The MediGap plan that is presently offered to retirees by the City is a superior plan for most people over the Medicare Advantage Plan. These plans have been around for many decades, and most doctors and hospitals accept these plans. They do not require as many prior authorizations for everything that they cover. They pay when they are supposed to; they don’t delay and deny in way that the newer privatized Medicare Advantage plans do.
Another issue with the new plans is that they have a contract with the City for only two years, a period of time which Marianne calls the Honeymoon period. After that, the insurer can renegotiate any of the terms of their agreement, which means that they can start charging higher premiums to members of the plan. This also means that they can charge more than the HIP/HMO Benchmark, making it so that the retiree will have to pay the premium difference over what the City pays.
To give you a frame of reference, when a retired person chooses this plan voluntarily, paying for it themselves, people have been quoted with a premium cost of $800 per month. This means that, while Aetna is giving the plan to the City for free now, meaning without premiums for members, that could change at any time in the future when they renegotiate the contract. Then the members could likely have to pay any shortfall in premium when the contract is renewed.
It can also be hard for people with preexisting conditions and other issues to afford Medicare Advantage plans, which are not regulated in the same way as the MediGap plans are. Medicare Advantage plans do accept patients with existing conditions, but such patients will also have to pay a higher premium. New York law provides that the MediGap insurance plans must accept all persons over the age of 65, without regard for any pre-existing health conditions. This is called Guaranteed Issue.
While Medicare Advantage plans are also Guaranteed issue for all persons over the age of 65, they tend to charge more for patients, based on the level of care they are anticipated to need. But the largest issue of the Medicare Advantage plans are their closed provider networks, where patients have a much smaller pool of doctors and specialists that they will be able to see.
The plan the City presently has as a choice for their retired workers is run by EmblemHealth and is known as Senior Care. Senior Care has been around for a very long time, and they have reasonable fees and fewer prior authorizations. Over the years, many retired workers have been enrolled in this plan, and they are able to see their preferred physicians and specialists, and they are able to get most of the healthcare that they need covered by insurance. Most of the retirees who have these plans are happy with them, and want to continue their enrollment into these plans. These are the plans the City wants to take away from retired workers.
Retirees should not be forced into the inferior healthcare plan that has already been determined by several judges to be in violation of the City’s contract with its former Union workers who are now retired. From our previous conversation with Marianne, we learned that retired Union workers are no longer members of the Union. Thus, these decisions are being made for them, without their input or consent.
City Council, NYS State Assembly, Both Can Stop The Need For Litigation, Preserve Healthcare For Retired Firefighters, Police Officers, EMS Workers, Teachers, Other Municipal Workers By Signing Onto Bills In Each Body
As Marianne mentions, and many of our readers know, particularly those who are attorneys, litigation is very expensive and very time consuming. The crucial part, though, is how expensive this fight is, especially for retired City workers on a fixed pension, which is often not very large. City Council members, mayors, governors, along with those in managerial positions, also receive pensions and healthcare from the City after their retirement, but they were not in the Union, so they did not get to vote on these issues.
In order for Intro 1099, the New York City Council bill that is currently seeking lawmakers to sign onto it, would correct this issue in a simple way. Intro 1099 would codify into law the City’s responsibility to provide multiple healthcare plans to retired City workers.
It is a very simple bill. It reads as follows: “This bill would require the City to offer Medicare-eligible city retirees and their Medicare-eligible dependents at least one Medigap plan with benefits equivalent to or better than those available to city retirees and their dependents as of December 31, 2021. The bill would not impair employee organizations from negotiating terms and conditions of employment for their employee members.” This simply means that the above-mentioned MediGap plan available in 2021 would need to be in effect for City workers and their dependents for the span of their retirements.
As previously stated, this plan costs the City about $200 per month per retirees. While many have said that the Medicare Advantage plan is free to the City, and will save the City millions of dollars, this is not the truth. Marianne speaks about this in the previous interview, which can be seen here
Insurance Companies Overcharging the Medicare Trust, Endangering The Healthcare Of ALL Americans, Already Under Investigation By Office Of Inspector General For Committing Medicare Fraud
Something else that Marianne mentions in the interview is something that insurance companies have been doing, called up-coding. They will come to senior’s homes, and talk to them about their heath. They will ask dozens of questions. Later, the insurance company will decide to charge more to the Medicare Trust for that employee. They are often practicing up-coding. This may be invisible to the Medicare patient, but it causes the Medicare Trust, which is often stated to not have sufficient funds to pay for healthcare of all retired Americans, to be drained more quickly, often at a rate double what it should be.
When the insurance representative comes to a senior’s home, the questions they ask allow them to claim that the patient is an increased risk to them. Thus, they have to charge more to the Medicare Trust for the same level of care that the patient was previously provided. This is Medicare fraud, and Aetna is currently under investigation for this very problem.
Marianne provides many ways in the video for people to get involved. She suggests most importantly contacting your City Council members and asking them to sign onto this important, succinct, and brief bill, is a good place to start.
A veto-proof majority is needed for this bill to succeed. As the Mayor is the one currently pushing for this Medicare change for retirees, he will certainly veto the bill. Without that majority, the bill will not succeed.
The matching bill in the Assembly is Assembly Bill 7866, found here
For the previous update on this topic, please visit this article.
An opinion about this topic can be found at this article.
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