The effort by the administration to levy a $191 monthly fee on retirees who want to keep their current coverage instead of enrolling in the new Medicare Advantage Plan runs counter to longstanding local administrative law, Manhattan Supreme Court Justice Lyle Frank wrote in a decision.
The law in question, Frank continued, requires the city to “pay the entire cost of health insurance coverage for city employees, city retirees and their dependents.” Any attempt to impose a premium or other cost for coverage is thereby illegal, he added.
“This Court holds that this is the only reasonable way of interpreting this section,” the judge wrote.
Frank’s decision caps a court battle between the city and a group of retired city workers that began last year under former Mayor Bill de Blasio’s administration.
In announcing the plan last fall, de Blasio’s administration presented Medicare Advantage as a boon to the city and save taxpayers hundreds of millions of dollars every year because it is subsidized by the federal government at a higher rate. At the same time, the administration maintained the new plan would provide the city’s roughly 250,000 Medicare-aged retirees with health coverage that’s comparable to what they’re currently receiving.
After vowing on the campaign trail to make sure the new Medicare plan wouldn’t be a “bait and switch” for retired workers, Adams announced last month that he would move ahead with implementing it as envisioned by de Blasio, angering retirees who said he was going back on his promise by keeping the $191 penalty intact.
A spokesman for Adams did not immediately return a request for comment after Frank’s ruling.
“The city got greedy, and held a sword over the head of retirees and said, ‘If you don’t accept your new plan, we’re not going to pay for your health care,’” Cohen said. “The judge saw right through that and said, ‘No way, you can’t do that.’”
According to data reviewed by the Daily News, more than 45,000 retired city workers had opted out of Medicare Advantage Plan as of mid-February despite the now-rescinded financial penalty they would face.
The Adams administration can still offer the Advantage plan to retirees on a voluntary basis, starting April 1, under Frank’s ruling. It was not immediately clear Thursday afternoon how the administration will proceed.
This story will be updated