Change in NYC’s Retirement Program places metropolis retirees’ medical insurance in danger
A planned New York policy could soon jeopardize the health insurance of their 245,000 retirees. The city plans to cut costs by moving its retirees and dependents from their traditional Medicare insurance to a cheaper private Medicare Advantage plan. The Mayor’s Industrial Relations Office is currently urging the local coalition of municipal labor unions to accept this change.
To create an illusion of choice, the insurance industry is promoting Medicare Advantage plans with offers for free gym memberships and home calls for care. In truth, business profit – not patient care – is the primary goal. A recent position paper by Physicians for a National Health Program states that these plans “avoid paying for expensive services by denying recommended treatments, restricting networks to less expensive providers, and forcing patients to leave the network for medical care received ”(www.pnhpnymetro.org).
The term benefit implies – incorrectly – that Medicare Advantage plans offer an upgrade in health care over the traditional Medicare program. Medicare Advantage plan profits skyrocketed during the pandemic. The number of elective surgeries, which are often costly to health insurers, has declined during the pandemic. The number of insured events has therefore decreased while the premiums remained constant. The result? Increased profit.
A recent report from the Kaiser Family Foundation (December 16, 2020) shows that gross profit margins on Medicare Advantage plans increased from $ 148 (margin per member per month) in 2019 to $ 200 in 2020. At the same time, millions of Americans lost their health insurance along with their jobs in 2020. Many Americans faced with COVID-related medical bills are bankrupt. Medicare Advantage plans continue to benefit from the recruitment of younger, healthier members while leaving older members off the traditional Medicare program in the event of illness. Medicare Advantage plans pay doctors badly. Many doctors do not accept Medicare Advantage patients. And there are co-payments and hidden costs for the patients.
Ms. KL, a 72-year-old rheumatoid arthritis patient from Mentor, Ohio, recently experienced the pitfalls of a Medicare Advantage insurance policy. With the support of monthly steroid injections for years, she continues to work as a freelance seamstress in retirement. Thanks to her injections, she maintains good finger dexterity and freedom from joint pain. Your monthly expenses? $ 30. However, Kaiser Health News (April 16, 2021) reports that Ms. KL’s retirement plan was recently changed from Medicare to an AARP Medicare Advantage plan by United Healthcare. After this change, Ms. KL received an invoice for an additional clinic and pharmacy fee together with her regular syringe for the first time. The total bill for the injection? $ 1262. Since her income is topped up by social security, she now has to decide: injections that she can no longer afford, or a job. If our city successfully converts its retirees from traditional Medicare to Medicare Advantage plans, many of the city’s retirees will suffer the fate of Ms. KL.
Saving shouldn’t be at the expense of the health of our retirees. Instead, the city should support the passage of the New York Health Bill. This bill would both save money and improve health care. Here in New York State, there is a growing momentum in passing legislation for a single payer healthcare system. Our bill, entitled “New York Health” (p. 5474; A. 6058) has long enjoyed a super-majority in the state assembly. It now also has a majority in the State Senate (33-30). The bill sets up a New York Trust Fund to serve as a bank. Health funds derived from progressive taxes as well as monies owed to our state from Medicare, Medicaid and CHIP are all paid into this fund. The medical costs are then paid from this fund. Just like Medicare. Every New Yorker pays his or her annual membership fee. Nothing more. Nothing at the time of interaction with a doctor or hospital facility. No deductibles, copays, donut holes or hidden fees. This universal system decouples health insurance from employment. Had such a system been in place in early 2020, people who lost their jobs would not have lost their health insurance as well.
A recent study by the Rand Corporation shows that the economic projections based on the bill are reasonable and should be acceptable to both patients and physicians. All other western industrial nations have some form of universal health systems. Everyone enjoys better overall health and at a lower cost. We should urge the city to support this law. In the meantime, we should contact the city council to block this proposed transfer of our health insurance program to a Medicare Advantage plan.
Marc H Lavietes, MD, is the secretary of physicians for a national health program, NY Metro Chapter.