Comptroller returns Medicare plan to Adams administration

City comptroller Brad Lander said he lacks “sufficient information” to register the contract for a controversial Medicare plan for city retirees, dealing the proposal, already beset by widespread dissatisfaction and litigation since it surfaced about a year ago, another setback. Story from The Chief by Michel Friang. April 5.

A Manhattan Supreme Court justice last month ruled that the plan, which had been scheduled to take effect April 1, was illegal as constituted since it would in essence have fined retirees who opted to stay in the current Senior Care program by making them pay an additional $191 monthly. As a consequence, Lander said he was unable to ensure that the contract would be paid for.

“Due to the legal and budgetary uncertainties that remain while litigation over the City’s contract with Anthem Insurance Companies continues, the Comptroller’s office does not have sufficient information to register the proposed Medicare Advantage Plan contract at this time,” Lander said in a statement last week. 

The comptroller, who took office in January, said his office’s Bureau of Contract Administration had made detailed inquiries of the Office of Labor Relations about documentation and the potential cost of the proposed contract but, given the court decision and delays in implementation, said his office could not “currently assess the total cost to the City and fulfil our mandate to confirm that the contract is fully funded.”

The $191 monthly charge was understood to be the city’s way of discouraging retirees from opting out, and getting a substantial majority to enroll in the plan, which was scheduled to take effect April 1. 

“We stand behind the retiree health care contract and are pursuing an appeal of the court’s decision. We will review the comptroller’s analysis and consider our options,” a City Hall spokesperson said in response to an inquiry on Lander’s decision.

In April of last year, it emerged that the de Blasio administration and municipal unions were engaged in talks about a switch to a Medicare Advantage program that the mayor’s office had hoped would result in potentially hundreds of millions of dollars in health-care savings. Retiree groups, however, were quickly skeptical, with some agitating to shut down the planned switch. 

City and Municipal Labor Committee officials, though, have argued that the Medicare Advantage Plus program would give retirees benefits at least equal to traditional Medicare plans for city retirees and even better. 

City retirees are unconvinced. By last month, before Justice Frank’s finding that the plan as designed was not legal, no fewer than 50,000 from a group of roughly 250,000 had opted out. 

In his statement, Lander said his office had asked Mayor Eric Adams’ administration to provide a new cost estimate for the Medicare plan, but also suggested that could not be possible pending resolution of litigation.

“As a result of these outstanding questions, following a rigorous review of the City’s proposed contract with Anthem Insurance Companies to provide health care services to City retirees, my office is returning the contract to the Administration,” he wrote. 

Following the judge’s decision, the president of the United Federation of Teachers, Michael Mulgrew, said the union was withdrawing support for the plan’s April 1 start. While the proposal would provide retirees with an “excellent range of benefits,” the inability to collect the monthly charge “will effectively eliminate the savings the plan would have produced and that would have been re-invested in health benefits for our members,” Mulgrew said at the time. 

“While the NYC Medicare Advantage Plus plan is sound, the program has suffered from serious implementation problems and poor legal arguments, particularly on the part of the city,” he said in a statement. “Our retirees deserve better.”

He urged the Municipal Labor Committee hold off on support for the plan’s implementation “until all the implementation and legal issues are resolved.”