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250K NYC retirees must switch to new Medicare coverage after union leaders favor privatized plan

(GOTHAMIST) Caroline Lewis, March 9, 2023

A committee of New York City labor leaders voted to approve a new Aetna-run Medicare Advantage plan for municipal retirees Thursday – a move that will force many former city workers off of their existing health coverage. The Municipal Labor Committee vote came out in favor of the plan, according to United Federation of Teachers President Michael Mulgrew, who is executive vice chair of the committee.

Some 250,000 retired city workers – and any dependents who use their insurance – will automatically be enrolled in Aetna’s new Medicare Advantage plan on Sept. 1, unless they decide to opt out, according to documents that were provided to the Municipal Labor Committee ahead of their vote and shared with Gothamist. For those currently enrolled in SeniorCare, the city-funded plan that supplements traditional Medicare, prescription drug coverage under the new Aetna plan will begin later, in January 2024. SeniorCare will ultimately be discontinued.

The switch will provide some new benefits, such as routine hearing and vision exams, hearing aids, and mental health care provided via telemedicine. But critics of the change have raised concerns that the Medicare Advantage plan will be more likely to require prior approval for certain medical services and potentially deny coverage. A recent federal investigation found that Medicare Advantage plans frequently deny coverage for services inappropriately.

Some retirees reportedly protested outside of union offices and City Hall ahead of Thursday’s vote.

The Municipal Labor Committee vote propels forward a long-delayed effort by Mayor Eric Adams to save money on city health benefits by switching retirees from traditional Medicare, bolstered by SeniorCare, to a privately run Medicare Advantage plan. The switch, which was originally proposed by former Mayor Bill de Blasio, could bring in an estimated $600 million annually in federal subsidies that are available to Medicare Advantage plans, according to the city.

“Aetna’s much-improved Medicare Advantage proposal, with new guarantees about prior authorization of services and enhanced other benefits, has been approved overwhelmingly by the Municipal Labor Committee,” Mulgrew said in an emailed statement.

The city’s effort to transition retirees has been mired in lawsuits for years and faced widespread opposition from those who fear their coverage under Medicare Advantage won’t be as good. Some retirees have fought to stay on traditional Medicare without paying extra, and this group loses out under the terms of the new deal.

Those retirees who want to avoid joining a Medicare Advantage plan altogether can waive city health benefits and remain on traditional Medicare – but they will have to pay out of pocket for any supplemental coverage. The monthly premium for Medicare Part B, which covers services including doctors’ visits and medical equipment, is $164.90 for those earning less than $97,000 a year. The current SeniorCare plan is premium-free, and the same will be true of the Aetna plan that will replace it.

Read More: Gothamist