New York State's highest court on Wednesday ruled against city retirees who had sought to block an effort by Mayor Eric Adams' administration to move them onto a for-profit, privatized Medicare Advantage plan.
In a unanimous decision, New York Court of Appeals Judge Shirley Troutman wrote that petitioners in the case are not entitled to "promissory estoppel" cause of action, the argument that the retirees throughout their employment with the city were promised traditional Medicare benefits when they retired.
According to Gothamist, "the court also ruled that the retirees did not have a legally binding promise from the city that their coverage would remain unchanged." The Wednesday ruling overruled a state Supreme Court judge’s decision that had prevented the Adams administration from making the switch, though the Court of Appeals said there were still issues in the case that should be sent back down to the Supreme Court, a lower court in New York's state system.
Medicare Advantage plans are run by private health insurers who receive money from the federal government to provide Medicare-covered services. Medicare Advantage enrollment around the country is growing, though the Medicare Advantage system has been accused of offering poor care and boosting corporate profits. A 2022 investigation by The New York Timesfound that major health insurers have exploited Medicare Advantage to juice their profits by billions of dollars.
The move to switch the city's 250,000 retirees to Medicare Advantage stems from a 2018 agreement between leaders in city government and major public employee unions to cut $600 million from the city's healthcare spending, according to the outlet The City.
"While we are disappointed in the ruling by the Court of Appeals, the solution to protecting seniors' healthcare has always been with the City Council and the mayor," said Marianne Pizzitola, leader of the Organization of Public Service Retirees, which opposes the switch.
"The City of New York should never, ever be screwing over retirees—and neither should the courts. Nobody will ever want to work for New York City again. Zero trust. Medicare Advantage is a bait and switch scam & betrayal. Enough! City Hall clearly doesn't care about retirees," wrote Justin Brannan, New York City Council Finance Committee Chair and Democratic candidate for city comptroller, in response to the ruling.
