The efforts by New York City Mayor Eric Adamas and the heads of municipal unions in the Municipal Labor Council to push retirees out of Medicare and into a cheaper Medicare Advantage plan have led to a stalemate that is stonewalling negotiations on a new labor contract for 300,000 unionized city workers. Under the proposed retiree health care plan, negotiated in secret over a period of several years, the city paid for raises in the contracts of current workers at the expense of expected savings in retiree health costs. The Medicare Advantage plan would charge a monthly fee for those who choose to retain their existing Medicare coverage.

When the proposed changes were revealed last year there was an immediate reaction from retirees across the city that grew louder as more and more heard about it. Chief among their concerns were the facts that (1) while some 80 to 90 percent of doctors in the United States take Medicare, under the private insurance plan, patients are restricted to the panel of doctors that participate in the plan, and (2) many medical procedures under private insurance require pre-approval and are often denied, requiring the patient to bear the expense, which can be great, out of pocket. They can appeal the decision to the company, which is also often denied, but even if approved, the delay can lead to serious consequences for the patient.

The massive opposition from retirees has stalled the proposal. Opposition was also growing among current city employees who will someday be retirees and who also fear that their health care could be threatened by future actions to save money. In a lawsuit brought by retirees, the court held for the plaintiffs and threw out the plan on the grounds that it violated  a provision of the City Charter. The city has tried to amend the Charter but at a hearing of the City Council Labor Committee in January, retirees and their representatives loudly expressed their opposition and a number of the committee members also indicated their opposition. Several units of the unions in the MLC also have publicly opposed the plan as well as the Professional Staff Congress, representing faculties at the colleges in the city university system. The New York Daily News reported earlier this month that the proposal to amend the City Charter was dead.

That leaves 300,000 city workers without a new contract since the mayor has refused to consider any alternate way of raising the money to pay for raises and improvements for teachers and other city employees. And there are alternatives like tapping into the general reserves or the $3.4 billion Temporary Benefits Trust. Other alternatives would be to reinstate the Stock Transfer Tax, a tax on stock market sales that was in force for many years before it was ended by the Koch administration some 40 years ago.

For the present, as one teacher put it, “I think we could be without a contract for a very long time.”

The City, 2’/12