The PSC and other unions are mobilizing against a proposal before the New York City Council that would weaken municipal workers’ health-care benefits. On September 8, the Municipal Labor Committee (MLC) approved a plan to join Mayor Eric Adams’ administration in calling on the City Council to change city law to remove the floor on city contributions to the cost of health insurance for city employees, retirees and their dependents.
Retirees protest proposed privatization last year. (Credit: Dave Sanders)
While public-sector unions bargain wages directly with their employers, the MLC, to which the PSC belongs, negotiates with the City to determine what kind of health-care package city workers and retirees receive.
The current predicament has been years in the making. The MLC, during the de Blasio administration, made a commitment to reduce the cost of health-care benefits for city workers and retirees. In 2021, the MLC agreed to transition retiree health benefits from traditional Medicare that included a supplemental city-paid private insurance (NYC Senior Care) to a Medicare Advantage Plus (MA+) program run by private insurance companies. PSC voted against this transition, which many municipal workers, including PSC retirees, adamantly objected to.
A coalition of retirees won a lawsuit on the basis that the administrative code requires the City to pay the cost of retiree health insurance up to the cost of HIP-HMO (over $700), so the City’s plan to require retirees who wanted to opt out of MA+ to pay a premium of nearly $200 to keep their current supplemental insurance was illegal. It is this code provision that the City now hopes to persuade the City Council to hastily amend before an appellate court gets a chance to hear arguments this October on the lower court’s decision.
Mayor Adams has put tremendous pressure on the MLC to do an end run around that court decision, sources have said. Just days before the MLC decision on privatization of medical benefits for retirees, City & State reported that union sources claim City Hall has been delaying contract negotiations with unions including District Council 37 and United Federation of Teachers due to the court’s decision. City unions that support the proposal to amend the administrative code point to the near insolvency of the Health Insurance Stabilization Fund that supports welfare benefits to city workers and retirees. The report notes the change, if enacted, would require the City to negotiate any change in contributions with the MLC, and some city unions hope passage of the measure will encourage City Hall to begin bargaining with them.
The situation puts these city unions in the position of making a permanent concession on the City’s contribution to health-care coverage in order to achieve a short-term fix in the stabilization fund and kick-start delayed contract negotiations. Critics of the proposed measure argue that the Adams administration is not displaying any intention to act generously when it comes to the city workforce. The New York Post reported that the mayor has ordered 3% across-the-board agency reductions and is demanding further cuts in subsequent years. These cuts come at a time when an inflation rate over 8% is compounding economic woes.
In a message to both PSC members and CUNY retirees, PSC President James Davis said that the PSC and a minority of MLC-affiliated unions voted against the proposal.
“The proposed change eliminates the HIP-HMO rate as the single standard for determining the City’s obligation to pay for health insurance for city employees, retirees and their dependents,” he said. “Under current law, the City is required to ‘pay the entire cost of health insurance coverage for city employees, city retirees, and their dependents, not to exceed 100% of the full cost of HIP-HMO.’
“Currently, the HIP-HMO cost is over $700 per month…. Under the modified language the City and the MLC could agree jointly on a different plan as the standard for either retirees and their dependents or active employees and their dependents and provide only the cost of that plan. The modified language does not specify what if any elements of health insurance coverage a new ‘benchmark’ plan must include.”
Both retirees and in-service employees worry that the new medical coverage schemes could lead to higher costs and less coverage.
Glenn Kissack, a delegate from the PSC Retirees Chapter, told Clarion he feared the proposed legal change “opens a Pandora’s box that will likely have a deleterious effect, not only on the health care of retirees, but on that of active members as well.”
“[The current law] guarantees that the City pays for the health care of both active and retired municipal workers,” he said. “The City and the MLC are now agreeing that there can be new categories of members created that can be charged for their health-care plans. Think of the potential consequences, remembering that business-financed groups like the Citizens Budget Commission have insisted for years that city employees pay a big part of their premiums.”
The Adams administration and the MLC leadership remain undeterred. The Daily News reported that they have both “dismissed the complaints from retirees as overblown, arguing the Advantage model would provide the requisite care,” adding that the new scheme, due “in part to its private administration” would “save the City upward of $600 million a year.”
Observers believe action on the bill will be swift. The City would like to see the new law enacted before the October hearing on the appeal of the retirees’ legal victory, and the bill cannot come to a full City Council vote until after two public committee hearings. In the next weeks, union members both for and against the proposal are expected to put heavy pressure on city lawmakers. The PSC is urging members to voice their opposition to the plan.
Members’ messages about opposition to the proposal have apparently already made their way to lawmakers. One city lawmaker, speaking anonymously to the Daily News said, “I think City Hall is dreaming if they think they can just slip this through.”
Published: September 29, 2022
Last Modified: November 9, 2022