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The municipal retiree health care storm

To save on health care osts, New York

To save on health care osts, New York City reached a deal with union leaders on pushing retirees toward a new benefits plan. Credit: iStock / Getty Images Plus/marchmeena29

Cellphones and email accounts belonging to New York City municipal retirees from Long Island to Florida are flooded these days with messages of concern.

How justified the anxiety proves to be will vary by the person. But it is building, as thousands from the region suddenly face complicated choices they were convinced they'd never need to confront.

To save hundreds of millions of dollars in health expenses, the city reached a deal earlier this year with union leaders who comprise the Municipal Labor Committee on pushing retirees toward a new plan called Medicare Advantage Plus. By one estimate, the change affects nearly 250,000 retirees. Until now, if former teachers, correction officers, sanitation workers, medics and others signed up for standard Medicare, their premiums were paid for.

By the end of the month, however, they face either moving into this new PPO plan or remaining in their current plan at a new cost of hundreds of dollars a month.

The dilemma may not spark widespread sympathy. Most private employees will never see as comprehensive a set of benefits as these veteran workers, even with a downgrade. Fiscal watchdogs have been warning for years that retiree health-benefit costs were going to balloon to the point where something had to give. This may be the moment.

One of those affected, with longtime expertise in retirement benefits, sounds neither optimistic nor pessimistic, just uncertain, in saying: "It’s a change, and retirees don’t like change. Will it be bad? No, I don’t think so. Do I know it’ll be great? No."

He believes the immediate problem lies in a bad rollout of the plan by the unions and city labor office, before many providers even knew enough to sign up for it. "It is a little like buying a new car that hasn’t been released yet," he says. "The information about the plan was a lot to put out in a limited period of time."

But many others are convinced the PPO plan marks a nasty downgrade of benefits they were promised for decades, which they say was a key reason they had stayed in public employment.

Voicing that charge is Marianne Pizzitola, a former longtime Babylon resident now living in Georgia, who heads the NYC Organization of Public Service Retirees. She's a veteran of the city’s Emergency Medical Service, and has led her members' outcry for months.

Pizzitola says unions sold them out to fund raises for active members.

In response, union and city officials have been trying to assure retirees that false rumors are spreading — and that Medicare Advantage Plus is really a good plan that providers will soon accept.

But this backlash won't be calmed so quickly. On Thursday, a state Supreme Court justice in Manhattan sided with Pizzitola's organization and voided the city's Oct. 31 deadline for the changeover.

Steve Cohen, a Manhattan-based lawyer, had stated in a petition filed in that court that the city's decision to "forcibly impose" a Medicare Advantage plan on retirees — or make them pay to keep their current plan — violates contracts under which they always worked and city statutes.

The MLC, the petition adds, is a "purely advisory group" that doesn't negotiate for retirees. The worst impact could come from the addition of pre-authorizations and copays, Cohen warns.

This current storm could send a chilling signal to current employees that long-promised benefits may not fully materialize. That's why it will be worth following for thousands of Long Islanders who work or once worked for the city.

Columnist Dan Janison's opinions are his own.

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