Judge blocks NYC from charging retired city workers $15 co-pays in latest Medicare setback for Adams

A Manhattan judge ordered Mayor Adams’ administration Wednesday to immediately stop charging retired city workers $15 co-pays for doctors’ visits.

The ruling from Manhattan Supreme Court Justice Lyle Frank marks the latest in a long string of health insurance setbacks for Adams’ administration, which has tried unsuccessfully for over a year to shift the city’s 250,000 retirees into a controversial, cost-cutting Medicare Advantage Plan.

The co-pay case is separate from the Advantage dilemma, but also pertains to how the city bankrolls health care for retired municipal workers.

Last January, the $15 co-pay was imposed on retirees benefiting from city-backed Medicare plans — a charge the administration estimated would allocate significant savings at a time that it is scrambling to address gaping budget deficits and skyrocketing health care costs.

But the NYC Organization of Public Service Retirees, which has been engaged in several health care-related court battles with the administration in the past year, filed a lawsuit in November alleging the co-pay would violate a local law that requires the city to provide its retired workers with cost-free coverage for life.

In a ruling Wednesday afternoon, Frank said the retiree group’s argument is “highly likely to succeed” before his court and issued a preliminary injunction against the administration barring it from charging the $15 levy as the case moves forward.

“The co-payments are being made by retirees, most of whom likely are on fixed incomes and with modest means,” Frank wrote in the six-page decision, adding that the charge could cause “irreparable harm” to retirees “should they have to prioritize other costs over their health care.”

Adams spokesman Jonah Allon said the administration is “extremely disappointed” with Frank‘s ruling.

“We will appeal this decision and seek a stay,” he said.

Steve Cohen, an attorney for the retiree organization, called Frank’s ruling “a major win” and tied it to the battle over Medicare Advantage, which his clients have also sued the city over.

“Again, retirees were promised certain benefits, and again the city chose to ignore those promises,” Cohen told the Daily News. “We are grateful to Judge Frank for reading the contract carefully.”

The ruling comes as Adams continues his push to enroll retirees in Medicare Advantage.

The mayor has maintained Advantage would provide retirees with robust coverage while also saving the city as much as $600 million per year — a critical cushion against budget deficits that his administration estimates could grow as large as $6 billion in coming years. His administration’s plan would provide Advantage to retirees for free, while offering them the option of staying on traditional Medicare if they pay a monthly $191 premium.

But thousands of retirees have balked at that proposal.

They say Advantage would destroy their benefits, pointing to federal studies showing that the plans — which are administered by private companies — can result in delays or denials of “medically necessary” care. They also say the $191 opt-out fee would violate city law.

Two courts have sided with the retirees, ruling the city can’t implement the plan with the $191 penalty attached due to the same law Frank cited in Wednesday’s ruling.

Adams has as a result turned to the City Council, asking it to amend that law in such a way that the penalty would become legal.

At a contentious hearing on the matter this week, Council members seemed skeptical of Adams’ proposal and several voiced outright opposition to it.

“Our retirees deserve the retirement benefits and health care benefits that they were promised, and it is our job as their elected officials to make sure that remains intact,” Republican Queens Councilwoman Joann Ariola said Monday.