Letter from PSC President, James Davis
February 18, 2022
Dear PSC Members:
I hope you and your families are healthy and well. I write to bring you up to date about the status of health insurance for current PSC retirees and the prospects for future retirees.
As most of you know, last summer the Municipal Labor Committee, which bargains health insurance with the City for all the unions representing City workers, including the PSC, voted over the objection of the PSC and several health care unions to transition premium free retiree health care coverage from traditional Medicare (Medicare Parts A and B) plus a free supplementary plan (usually GHI Senior Care) to a Medicare Advantage Plus plan (MA+) provided by two companies, EmblemHealth and Empire Blue Cross, in a partnership they call “the Alliance.” The shift to MA+ is intended to save the City $600 million annually, per an agreement that the DiBlasio administration struck with the Municipal Labor Committee.
The PSC opposes the further privatization of Medicare. Privatized Medicare costs taxpayers significantly more than traditional Medicare and is proving so profitable that hedge funds are moving into the business of direct contracting to provide retiree health coverage. City employees were assured that in retirement they would have access to affordable, quality health coverage, but the track record of MA+ plans has often been to limit access to providers and impose preauthorization requirements for many procedures. We remain concerned about these factors despite assurances from the Alliance and the City.
The PSC wants to prevent the shift to MA+ from further eroding health care for active employees and retirees. We are therefore working with the PSC’s Social Safety Net Working Group and other experts and PSC activists to 1) educate our members about these potential threats as well as options to protect their health care, and 2) develop a viable coalition strategy for reforms, such as more affordable hospitalization, self-insurance by the City, controls on prescription drug costs, and ultimately single payer health care for all.
Medicare Advantage Transition Update
The contract between the City and the Alliance, which was finally made public in October, has serious flaws. Last fall, I testified at a City Council hearing, submitted testimony to the NYC Office of Labor Relations, and met with the outgoing City Comptroller. In the new year, I met with the new Comptroller and sent a letter to incoming Mayor Adams shortly after he was sworn in, asking that the City re-examine and reconsider the contract. You can find links to these letters on the PSC retiree web page, at https://www.psc-cuny.org/whats-happening-retiree-healthcare
. Unfortunately, on February 6 the Adams administration announced its support for the transition to MA+.
The contract has been challenged in court. In December, a New York state judge delayed the implementation of the MA+ Plan until April 1, 2022. The judge ordered the City to provide retirees with more accurate information in response to a request for a preliminary injunction in a lawsuit against the City and the Alliance by a coalition of City retirees, including some from the PSC.
To prevent further delays to the MA+ implementation date, the City would need to demonstrate that it has complied with the judge’s order by providing retirees with adequate information about whether or not they will have continued access to their current medical providers and the co-pays and pre-authorization requirements under the new plan. The judge also wants to make sure retirees are fully informed about their option to remain in traditional Medicare (together with their current supplementary plan) for a monthly premium. The judge has also ordered that retirees not be required to pay two annual deductibles in 2022.
If the city meets these conditions, all retirees will be moved automatically to the new MA+ plan as of an implementation date of April 1 unless they “opt out” by March 31 to remain in their current plan. They will also have an additional three months, through June 30, to move in either direction between the MA+ Plan and their current plan. However, many NYC retirees cannot afford to remain in their current plan, which, to take Senior Care as an example, will, as of the implementation date, have an annual premium of nearly $2,400 per year per retiree and $4,800 per year for retiree plus spouse in 2022.
The judge decided last week to continue the preliminary injunction until he rules on the main issue in the lawsuit: whether the City and the MLC had the authority to change retiree benefits in the way they did. We expect a ruling sometime between late February and late March. If the court allows the City and the Alliance to implement the MA+ Plan effective April 1, the City will likely begin transferring retiree data to the Alliance and to the Centers for Medicare & Medicaid Services (the federal agency that administers Medicare and Medicaid) no later than March 25. If you are a retiree and plan to opt out, you should do so well before March 25. Although it will theoretically be possible to opt out through March 31, once the data transfer begins it will take longer to move between plans.
The MA+ plan implementation process has been complex and confusing. The PSC, our Retiree Chapter leaders and the PSC-CUNY Welfare Fund have worked hard to provide our retirees with the latest information, even as the City and the Alliance have been slow to convey accurate information and clear procedures. The PSC Retiree Chapter posts the latest developments here
To clarify another confusing element: all retirees enrolled in Senior Care received a notice in December that provider co-pays in several service areas are increasing from $0 to $15 effective January 1, 2022, like the increase in co-pays for active employees several years ago. The co-pay increase in Senior Care was approved by the MLC nearly 2 years ago but, because of the pandemic, its implementation was delayed. Our understanding is that these co-pays also apply to the MA+ Plan.
It is important to note that PSC retirees will continue to receive all their current Welfare Fund benefits—most crucially, the prescription drug plan, SilverScript. Retirees in other unions have different benefit structures. The PSC has also been working with the City and CUNY to ensure that PSC retirees who are not in TRS or NYCERS but in TIAA (and therefore may be receiving a monthly annuity inadequate to pay increased premiums) have the option to direct pay their premiums if they opt out of the MA+ plan.
Our Retiree Chapter members continue to participate with other NYC retirees in rallies and demonstrations opposing the MA+ plan, and as noted above, the PSC persists in asking elected officials to reconsider the contract.