Op-ed | Mayor needs to reverse decision that shifts retiree health coverage for municipal employees to a Medicare Advantage plan

City retirees and union members held a protest earlier this year in response to the mayor’s plan to shift retiree health coverage for municipal employees to a Medicare Advantage plan.

New York City was built on the shoulders of hardworking individuals who dedicated their lives to making this city great. Among them are our municipal retirees. Their years of service earned them a promised Medicare plan to meet healthcare needs in their golden years.

Unfortunately, the Mayor pulled a blatant bait-and-switch by signing an executive order that shifts retiree health coverage to a Medicare Advantage plan. This move disregards retirees’ contributions and fails to deliver pledged financial benefits. Our retirees deserve better than a broken promise.

Several groups of retirees have taken legal action against the mayor’s administration in an effort to prevent the City’s effort to diminish care for retirees. Recently, a judge temporarily blocked the switch while the case is pending in court—delaying the September implementation deadline for the mayor’s plan.

We are encouraged by the ruling and hopeful that as the case moves forward in court, the justice system will hold the City accountable for promises made to the retired public servants who dedicated their lives to caring for New Yorkers. However, this is not the only avenue to halt this plan; we also support legislation that requires the City to offer Medicare-eligible retirees and their dependents plans with benefits equal or superior to their current health plan.

Retiree health benefits, which our city promised to retirees during their working years, are a form of deferred compensation that retirees accepted as part of their pay packages. For decades New York City’s municipal workers were assured that at retirement they would get a Medicare plan that included at least one Medigap policy.

Designed to cover the 20% of medical costs not covered by Medicare, these gap plans also ensure retirees can see any healthcare provider in the United States who accepts Medicare. This flexibility allows them to continue their longstanding relationships with trusted doctors, maintaining continuity of care. The City must honor its promise and reject any proposal that does not guarantee continuity and access to care.  No municipal retiree should be asked to pay more or accept less than they were promised.  

The mayor defends the Advantage plan as a win-win, claiming it will save the City $600 million annually in healthcare costs while allegedly providing robust benefits to retirees. This argument is based, in part, on the plan’s higher federal government subsidies compared to traditional Medicare options. However, the data suggests a different reality.

According to New York City’s Independent Budget Office, taxpayers would see no savings under the mayor’s plan. Furthermore, the U.S. Department of Justice is currently investigating eight of the ten largest Medicare Advantage insurers, including Aetna, for allegedly encouraging in-network physicians to falsify patient records, potentially defrauding the federal government of over $600 billion in the next decade.

While Medicare Advantage Plans can be a great fit for many, we believe any changes in coverage for New York City retirees must be voluntary.  The decision to replace traditional Medicare with Medicare Advantage could carry significant risk for retirees with specific and ongoing health care needs being covered by their current Medigap plan. 

AARP New York calls upon the mayor to reconsider his ill-advised move and instead prioritize honoring the commitments made to New York City retirees. It is our duty to provide retirees with Medicare-eligible plans that offer benefits equivalent to or better than what was initially promised. New York City retirees have played an instrumental role in building and elevating this great city. They deserve to enjoy their retirement years with the peace of mind that their healthcare needs will be met without unnecessary barriers or discrimination. Let us stand together to protect the promises made to our retirees and ensure they receive the health care they rightfully deserve.

Beth Finkel is the state director of AARP New York