SEEKING TO OFFER REASSURANCES: City Labor Commissioner Renee Campion (left) and Deputy Commissioner Claire Levitt say that contrary to concerns expressed by retiree groups that they could be hurt by a pending switch to a Medicare Advantage program for their health care, the vendor once chosen, in a process that requires union agreement, will be offering improved services and upgraded benefits even as the city's costs are reduced.

Discussions between the de Blasio administration and municipal unions meant to produce hundreds of millions of dollars in health-care savings through a move to a Medicare Advantage program have prompted alarm and suspicion among some retiree groups and activists that the savings will be realized either by reducing benefits to them or increasing out-of-pocket costs.

Uneasiness grew after an April 21 article that was a collaboration between the investigative website The City and New York Focus headlined, "Retired City Workers Recoil at Coming Cost-Saving Medicare Shift." 

Among those it quoted was Jane Roeder, a former high-level official in the Office of Labor Relations, the agency that has been spearheading the city's attempt to reach a deal with the unions. Calling the prospect "a little frightening," Ms. Roeder said, "The word on the street is that these Advantage plans are fine as long as you don't get sick, as long as you don't need the chemotherapy that my friend is having right now, or radiation treatment, or infusion treatment, or skilled nursing."

Try to Allay Concerns

OLR officials have been tight-lipped about the discussions, which will eventually lead them to agree with the Municipal Labor Committee, the union coalition that negotiates health-benefit changes, on a single private insurer to run the Medicare Advantage program for 250,000 city retirees and their spouses.

But in the wake of that article, Labor Commissioner Renee Campion and Claire Levitt, OLR's Deputy Commissioner, Labor Strategies, spoke at length during an April 22 phone interview to try to calm those who seem convinced that they are collaborating with the unions to stick retirees with the short end of the eventual agreement.

They were somewhat limited in their ability to discuss specifics, Ms. Campion said, because "we have not selected a vendor yet. We are down to the finalists."

Although the City/New York Focus article said retirees had been told by their unions that the finalists were Aetna and Empire BlueCross BlueShield, Ms. Campion declined to name the finalists, or even to confirm that there were just two of them.

Insists Plan Will Help All

The one aspect she and Ms. Levitt were willing to affirm was that when a vendor was selected, the planwhich they expect to have up and running before the end of the year—would benefit retirees as well as the city and its unions.

Retirees' apprehensions had two roots, Ms. Campion said: "People are afraid, No. 1, that they're not going to be able to see their doctor, and it's going to cost them a ton more money."

While there are a small number of Medicare Advantage programs nationwide in which either or both of those negative aspects exist, Ms. Levitt said that neither will happen under the vendors the city and the unions are considering.

Ms. Campion said, "We are committed to our retirees and making sure any new program will increase quality and benefits while reducing costs to the city."

Medicare Advantage, Ms. Levitt said, is a replacement for the traditional Medicare Part A and Part B. Instead of being administered by Medicare, it will be run by a private insurer, something that is already true for 40 percent of retirees nationally.

The huge amount that the city and unions would be spending on the plan assures them better treatment than might be available through a smaller employer or union.

'Still Go to Any Doctor'

"We're buying a Group Medicare Advantage Program," Ms. Campion said. "It's still going to be a free program for retirees, and they'll still get Medicare Part B" reimbursement from the city.

Ms. Levitt said the fear caused by some Medicare Advantage plans that a smaller network of doctors would be available to retirees would not materialize with the vendor chosen by the city and the MLC.

"In the Medicare Advantage programs that we're looking at," she said, "you can still go to any doctor or hospital that accepts Medicare," noting that "99.5" percent of the nation's doctors participate in Medicare.

She conceded, however, in a subsequent email that a concern raised in the City/New York Focus article that  more than half of Medicare Advantage participants were in plans that required prior authorization for some services, including ambulance rides, had validity.

'Some Pre-Authorization'

"Our finalists indicated in their proposals that some services will require pre-authorization," Ms. Levitt stated. "These include hospital inpatient, behavioral health inpatient, ambulance and step therapy for certain high-cost drugs. Note that all these services and many more require pre-authorization in the City's current plans for active employees, as they help control quality and costs by getting patients to the appropriate care. The retiree should not have to do anything about the pre-authorization; they are typically handled by the provider."

And, she added, "Traditional Medicare doesn't technically require pre-authorization, but it does have medical-necessity provisions that apply to the payment of many services. So, for example, Medicare regulations state that 'Medicare covers ambulance services only if they are furnished to a beneficiary whose medical condition is such that use of any other means of transportation is contra-indicated. A beneficiary whose condition permits transport in any type of vehicle other than an ambulance would not qualify for services under Medicare.' " 

Whichever vendor is ultimately chosen, Ms. Campion said, the new program will mean "improvements on the benefits that people have in their Senior Care plan. It will offer both fitness and wellness programs to retirees, and result in lower co-pays and out-of-pocket expenses."

Not Squeezing Every Nickel

"We're not looking to save as much money as possible," she said, which was why the deal could offer improvements for retirees even while providing the city the cost relief it needs.   

Ms. Levitt noted that the many municipal retirees who have moved out of state will have access to the Medicare Advantage program that is chosen, and that in cases in which a retired worker's spouse is not yet Medicare-eligible, he or she will remain in the plan for active employees until they are old enough to qualify.

"The savings come from the fact that the [private] insurers are much more efficient at managing the plan than Medicare is," she said, notwithstanding Medicare's well-earned reputation as among the best-administered government programs. 

And, Ms. Levitt added, the vendor will have a built-in incentive to provide quality services: "the higher the plan is, the more they get from Medicare. We are only tapping into four-star plans."

MLC Chairman Harry Nespoli, who is also president of the Uniformed Sanitationmen's Association, said April 23, "I understand the retirees' concerns—they're on fixed incomes and they want to know exactly what the changes will be."

'Can Keep Their Doctors'

But, he said of some of those who have been deluging their union leaders with calls, "They think it's the old Medicare Advantage. It's not: they can keep their original doctors."

While he echoed Ms. Campion's remarks, saying, "We still have to work out the particulars" of the provider and the plan, Mr. Nespoli said the MLC would meet with union presidents before the end of the month for a progress report, and would not finalize terms before having them vote on the agreement.

One of the early critics of the secrecy surrounding the discussions had been Stu Eber, the former head of the Managerial Employees Association who is now president of the Council of Municipal Retiree Organizations. In an open letter to the Mayor and the MLC that was published in this newspaper's March 12 issue, he stated, "Nowhere in this process have you consulted with the 200,000 people and their families to determine how it will help or harm us...The lack of transparency in your rush to change this program is both insulting and frightening to those of us who have collectively worked millions of years serving the people of New York City. How can we trust our very health to a back-room deal based on a dubious assumption of cost avoidance?"

Reason for No Discussions

When the two OLR officials were asked why there hadn't been education sessions to answer retiree questions and assuage their fears, Ms. Campion replied that this was not feasible at a point when the city and the MLC have not made a decision on the provider.

"You need to know who the vendor is before you can have the conversations," she said, with Ms. Levitt explaining that "the finalists have different benefits that they're offering."

Once the city and the MLC make their choice, she said, "There will be a very extensive outreach program," with a customer-service call center set up solely to answer questions about the program.

Ms. Campion provided a copy of a letter she had sent to Mr. Eber March 31 trying to reassure him that stated, "The selected Medicare Advantage program will continue to be free to retirees. The offerings have been carefully analyzed to ascertain that the program will not harm retirees but actually provide better or equal coverage. The program permits retirees to utilize any provider nationally that accepts Medicare, assuring that provider choices are as broad as they are under the current program. There will be no bureaucratic hurdles to selecting providers or obtaining care. The Medicare Advantage program also offers additional programs for retirees not available under the current program including transportation and food delivery for post-hospitalized patients and coverage for fitness programs."

Lost in the Mail

Mr. Eber, reached by phone that evening, when asked why, after receiving those assurances, he had remained skeptical of the program in his comments for the City/New York Focus article, said he had not seen the letter, which had been sent to him at the offices of the Professional Staff Congress rather than COMRO or his home address.

After a copy was emailed to him, he said he would defer a detailed comment on its contents but supported a resolution approved by the PSC's delegate assembly April 15 asking that the City University of New York instructors union persuade the MLC to place a moratorium on moving to a Medicare Advantage program.

Ms. Campion said the uproar from retirees had not been directed only at her agency. "I think the unions, from what we're hearing, are getting their fair share of incoming," she said, adding that once a vendor has been chosen, the city and the MLC will work jointly to lay out the details of the program for retirees.

She declined to comment on when the choice has to be made in order to have the program operational by the end of the year, except to say, "We need the vendor in place as soon as possible."    


(5) comments


I believe the most concerning part of this entire story, is that the District Council and OLR did this behind the backs of the Retirees. How can DC37 support such a plan, when they have for years, lobbied against privatizing Medicare? Under the NYS Constitution, and many case law examples, the State nor the City "cannot change the contract terms for retirees without their consent." There is a large baby boomer population currently on these benefits and that won't always be the case. Enrollment will change, and the City and Unions can negotiate retiree benefits for current employees. But they CANNOT reduce the benefits earned and negotiated by current retirees. Hopefully, the City doesn't negotiate away current union health benefits either. Unions must defend this move and protect retiree healthcare. Many of our Members in the FDNY EMS Retirees Association are under 65, and no longer live in the NYC metro area and have trouble using their insurance where they currently reside. To now change the insurance plans of all the Medicare eligible, without discussing it with their respective retirees organizations is negligent. And shame on DC37 for agreeing to something they lobbied against for decades. When there is no transparency, people tend to be suspicious and skeptical of the motive. If it were not for the article, no one would have known they were doing this. I respectfully hope they include us in their discussions going forward. Transparency and communication should be standard policy.

Marianne Pizzitola


FDNY EMS Retirees Association, Inc.


Respectfully, this does not encourage confidence. How can we retirees trust assurances that we will continue to have as broad a choice of doctor as we have now, when, in the same breath, we get the following double-talk: "The program permits retirees to utilize any provider nationally that accepts Medicare, assuming that provider choices are as broad as they are under the current program." These promises sound just about as trustworthy as Joe Namath's misleading and deceptive Medicare Advantage pitches to gullible seniors on mid-day tv.

Bennett Fischer

You let the OLR spokespeople get away with an awful lot of propagandizing in this article. OLR's patronizing spokespeople explain absolutely nothing here. You let them get away with nothing more than blithe assurances that everything will be great for retirees, with no details to back it up.

Details? You want details? All you'll have to do is phone up the marvelous customer-service call center after the deal is done. That's innovation!


Harry Nespoli has been a disaster as MLC Chairman. He is more comfortable with management, than the people he is supposed to represent. The city made him look the fool in the last round of cuts and cost increases to retirees and active benefits a couple of years ago.

Marc Kagan

I don’t believe every article needs to be on the one hand, on the other hand, but here you literally made no effort to investigate OLR’s claims or find other opinions.

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