Retired individuals from New York City who are against Medicare Advantage are scrutinizing a loophole that may enable them to retain their conventional coverage

Retired municipal employees are seething over the city’s push to enroll them in a Medicare Advantage Plan designed to cut costs. They are now focusing on a contractual loophole that may allow them to remain on traditional Medicare without incurring additional expenses; however, this would require Mayor Adams’ approval.

For almost two years, the municipal government has been attempting to transfer approximately 250,000 of its retired workers to an Advantage plan in order to save the city approximately $600 million each year by leveraging greater federal subsidies.

Numerous retirees have expressed their discontent with this move, fearing that they would be deprived of access to specific medical practitioners, procedures, and medications under the privately-managed Advantage plan.

Despite the uproar, Mayor Adams and the Municipal Labor Committee leaders in the city approved a contractual agreement this month with Aetna, a health insurance behemoth, asserting that Advantage would be the only no-cost health insurance option for municipal retirees. Adams’ administration argues that this drastic measure is necessary to comply with court orders that had previously blocked their initial Advantage plan.

The Daily News discovered, however, that the $200 million Advantage contract awarded to Aetna by the Adams’ administration includes a provision dubbed “Option C,” which would allow municipal retirees to retain traditional Medicare coverage without incurring extra costs.

Nevertheless, Option C is solely feasible if Adams chooses it from among the three Advantage implementation frameworks, which do not all offer traditional Medicare opt-out choices.

According to the contract, which was made public on March 10, Option C would require Adams’ administration to pay a $20 monthly fee for each member who selects traditional Medicare supplements over Advantage. If Adams agrees to this fee structure, the $600 million in annual budget savings that his administration anticipates from the Advantage plan is likely to decrease, although it’s unclear by how much.

On Tuesday, representatives for Adams were unavailable for comment.

Michael Mulgrew, the president of the United Federation of Teachers, one of the city’s biggest unions, played a significant role in promoting the Aetna contract this month, and a spokesperson for him indicated that Option C is improbable.

The spokesperson, Alison Gendar, stated that Option C was included in the Aetna contract as a backup that could be activated “if the City Council amends the city administrative code to allow for additional ‘pay for’ options,” alluding to Advantage-related legislation that the administration and labor unions proposed to the Council last year but without success.

During a public hearing on Tuesday morning regarding the five-year Aetna contract by the Mayor’s Office of Labor Relations, several municipal retirees opposed to Medicare Advantage urged Mayor Adams to select Option C instead. Option C is included in the Aetna contract and would allow retirees to keep traditional Medicare coverage without any additional costs, but the administration would have to pay a $20 monthly fee for each member who chooses traditional Medicare over Advantage.

The retirees argued that while Option C might not provide the same savings as Advantage, it could be a reasonable compromise.

One of the retirees, David Kotelchuck, a retired Hunter College professor, urged the mayor to choose Medicare over “Money-care.” Gail Benjamin, a retired municipal government veteran and former director of the City Council’s Land Use Committee, shared similar sentiments.

“Option C would be desirable for both retirees and for the city,” Benjamin testified.

Retirees who are against Advantage have cited federal studies that reveal how beneficiaries may be denied “medically necessary” care under these plans. This denial of care is partially attributed to pre-authorization protocols.

“This is a life-and-death issue. You deny access to some of those doctors and treatments, I die,” retired Baruch College English professor Jacqueline Disalvo, who’s wheelchair bound and suffers from multiple health issues, said at the hearing.

A significant number of retired municipal workers, who are worried about Advantage, currently receive Medicare benefits with a city-subsidized GHI SeniorCare supplement, which is a traditional Medicare coverage arrangement. However, the SeniorCare supplement is set to expire on Sept. 1 when Aetna’s Advantage plan is scheduled to be implemented. Nonetheless, retirees who are against Advantage argue that Option C would create an opportunity for the city to establish a new version of the SeniorCare program.

The administration of Adams, Mulgrew, and other leaders in the Municipal Labor Committee have maintained that Advantage would offer comprehensive care to retired employees and save the city hundreds of millions of dollars annually.

James Davis, the President of the Professional Staff Congress, a union that represents approximately 30,000 City University of New York employees, expressed surprise that he was not previously informed about Option C. He only discovered it this week while his team was reviewing the extensive Aetna contract that was recently made public.

“Option C has to my knowledge never really been discussed, and I wasn’t aware it was even an option,” said Davis, whose union was among the 26 that voted against adopting Aetna’s Advantage plan during a contentious Municipal Labor Committee meeting on March 9.

Davis said his union would switch to supporting the Advantage plan if Adams picked Option C. However, Davis acknowledged that Option C would undermine Adams’ justification for pursuing Advantage in the first place.

“It would definitely eat into the savings that they would be able to allocate,” he said.