Saying that city officials have been unwilling to address unions’ concerns, the United Federation of Teachers has withdrawn its support for an Adams administration effort to switch municipal retirees to a cost-saving private health plan, dealing it and the administration a significant setback.
In a letter to Municipal Labor Committee Chairman Harry Nespoli, UFT President Michael Mulgrew said the union also would no longer back ongoing negotiations for a new benefits plan for current city employees and pre-Medicare retirees.
“It has become apparent that this administration is unwilling to continue this work in good faith,” the four-paragraph letter, dated Sunday, reads. “This administration has proven to be more interested in cutting its costs than honestly working with us to provide high-quality healthcare to city workers.”
In a subsequent phone interview, Mulgrew said that achieving health-care cost-savings was critical, but that doing so at the expense of retirees and employees, and without parlaying the city’s political power in negotiations with insurance companies, hospitals and other for-profit health-care players, was shortsighted and unjust.
“It’s caused all this fear and anxiety and it’s not worth it,” he said.
Mulgrew said Mayor Eric Adams has so far refused to meet with union leaders. “You can have the greatest plan, but you have to have a strategy” to implement it, he said.
Instead, there are ongoing and repeated arguments among union leaders, city labor officials and the administration, the union leader said. “There’s fights over everything,” with cost-savings being the overriding consideration among city officials, he said.
The move is yet another significant setback for the city’s long-frustrated intention to shift health-care coverage for about 250,000 retired municipal workers from government-administered Medicare to a for-profit Medicare Advantage plan.
City Hall deferred comment to the city’s Law Department.
“We have been clear: the city's plan, which was negotiated closely with and supported by the Municipal Labor Committee, would improve upon retirees’ current plans and save $600 million annually,” a Law Department spokesman said in a statement. “This is particularly important at a time when we are already facing significant fiscal and economic challenges."
Nespoli, the MLC chair, said he was taken aback by Mulgrew’s announcement. “It's totally caught me by surprise,” he said Sunday.
Nespoli said the MLC’s five-member executive board — composed of Nespoli, Mulgrew, District Council 37 Executive Director Henry Garrido, Local 237 Teamsters President Gregory Floyd and CWA Local 1180 President Gloria Middleton — would meet Wednesday as well as confer with consultants to discuss possible next steps in light of Mulgrew’s announcement.
Mulgrew, the MLC’s executive vice-chair, was instrumental in getting the group to greenlight the proposed Medicare Advantage switch. The MLC overwhelmingly approved an agreement between the city and managed-care giant Aetna in March of last year. That agreement, though, was scuttled in large part because of ongoing court battles over the plan.
Nespoli declined to speculate on any further fallout, noting that the matter was still in the courts. But he echoed some of Mulgrew’s concerns, saying the administration was slow to respond to unions’ collective disquiet. “That was a very big issue for the MLC, and that was a concern,” he said.
Nespoli, who is also president of Teamsters Local 831, the Uniformed Sanitationmen's Association, said it would be up to individual unions to decide how to proceed. “Everybody forgets how many unions we have in the MLC, and everybody has an opinion and we have to guide these other unions and also turn around and listen to what they have to say,” he said. “I don't tell people how to run their unions.”
Garrido, who heads the city’s largest public-sector union and is the MLC’s co-chair, sounded a more ominous tone about what could come next.
“We will assess the impact of the UFT’s withdrawal from the process and determine next steps with our partners in the MLC,” Garrido said in a statement. “The very stark fact remains that healthcare for City workers and retirees needs to be funded, and absent a viable solution such as the one underway, those premium-free benefits are on the line.”
MLC is key
The MLC’s endorsement of the Aetna Medicare Advantage agreement last year — it was OK’d by 79 percent of votes in weighted balloting favoring the largest municipal unions — meant the plan had cleared a significant hurdle. Courts, though, have not not been receptive.
Last month, a four-justice panel of the State Supreme Court Appellate Division upheld a trial court finding that switching the retirees to a cost-saving private plan and stripping them of their Medigap coverage would break long-ago guarantees city officials made to employees. The panel’s conclusion marked the fourth time that courts have sided with the retirees.
The New York City Organization of Public Service Retirees, one of the lead plaintiffs in the case, welcomed the UFT’s reversal.
“It is time for the City to come to its senses and end its senseless, illegal war on retirees. If retirees are forced off of traditional Medicare and into the City’s new Medicare Advantage plan, thousands will be denied access to the doctors they depend on and the medical care they desperately need,” the organization said in a statement.
It called on the administration to confer with retirees “to find real, sensible solutions to today’s healthcare challenges.”
Although Mulgrew did not address either the merits or drawbacks of the administration’s Medicare Advantage plan, he was critical of strategies employed by city attorneys, saying they were fumbling through inexpert arguments in court cases brought by the retirees.
But the UFT leader also alluded to discontent within his own union. “If a large segment of my union says it’s not worth it, we have to listen to them,” he said.
Mulgrew briefly alluded to UFT Retired Teachers chapter elections last week, which saw the Retiree Advocate caucus decisively oust the incumbent, pro-Mulgrew Unity slate. The Retiree Advocate slate had campaigned largely in opposition to the city’s Medicare Advantage plan.
The proposed switch of the retirees to a private plan has been in the works since the de Blasio administration, with city officials saying that it would save the city as much as $600 million annually, with the savings derived from federal subsidies underwriting Medicare Advantage plans. Those funds would help replenish the city’s Health Stabilization Fund, which supplements employee welfare funds.
But Mulgrew said that discussions with Adams administration officials were no longer productive and had turned antagonistic. “It’s no longer a partnership, it’s adversarial,” he said. “It is not a collaborative process as it was for nine years.”
Despite his misgivings with the administration's approach, Mulgrew indicated he would be willing to continue discussions.
“As always, we are willing to do the hard work of fighting to maintain our benefits and keep high- quality, premium-free health care for all our members, but we need a willing partner,” he wrote in his letter. “We will not let the city keep wasting our time, and we will demand they put workers first.”
Bennett Fischer, the Retired Teachers Chapter leader-elect, said Mulgrew’s about-face on the Medicare Advantage plan was more a product of ebbing support for the union leader rather than union disagreements with the administration.
“UFT retirees are neither fearful nor anxious. We are clear-eyed and steadfast in our opposition to the privatization of our public Medicare benefits,” Fischer said in an emailed statement.
He said that rather than determine what was best for the retirees on his own, Mulgrew should have conferred with and listened to them. “UFT retirees need to be intimately involved in all UFT policy decisions that directly affect them,” Fischer said, noting that this was a central tenet of his caucus’ platform.
He called on Mulgrew to support city and state legislation that would preserve their current benefits. “The way forward must be together,” Fischer said.
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