Words, words, words . . .

I’m reacting today to Arthur’s post “Unity Has a New Health Care Narrative,” where there is some talk of the new $15 copay for each benefit in Senior Care and the out-of-pocket maxes.

I’ve been saying for years that muddled terminology gets you into muddled thinking, and I’m pretty sure that the lack of clarity in the ongoing health care negotiations isn’t going to produce the best results. 

It started a couple of years ago when hundreds of our colleagues were shouting all over the place that they didn’t want to “lose their Medicare.”  I was told they needed that kind of rhetoric to gin up rank-and-file support against the Aetna PPO we were being pushed into. Those protesters certainly got the job done, and I love that, but I think their health care concepts are not yet firmly in place. If they’re going to negotiate for us, I want them to spot on with that. 

Trying now AGAIN to clarify some things about Senior Care. 

It has always been a hybrid plan – the result of negotiations between the unions and NYC. It’s never been a straight “Medigap,” the kind you get in the open market.  Those true Medigaps are designed by the feds and managed by the states. The screenshot below shows how each of those 10 plans supplement Medicare (it’s from Medicare & You 2025, p.76).

Here’s the differences between our Senior Care and those Medigaps and why it’s a hybrid:

• First.  The most comprehensive of the 10 true Medigap designs – F, G, and their high-deductible versions – do not have copays. The popular N plan does have one, but only for two things: a doctor visit (up to $20, it can be waived altogether) and a $50 copay for the emergency room if you’re not formally admitted. The less popular B, C and D plans don’t have doctor or ER copays either. For all of these, there aren’t any copays at all for therapists, lab tests, and x-rays. The union negotiated a $15 Senior Care copay for every little thing, but for now they’re stopped by the Court. Supposedly they’re coming back January 1. 

Weird note:  I just signed into my plan at EmblemHealth. It says we have a $15 copy for specialist visit, $15 for each allergy visit, $50 for hospital emergency room, and various copays or percentages for other services. I’m not sure that screen is accurate. My card says specifically says no copays for doctor visits, so why is the website saying there’s one for a specialist? Who knows.

• Another difference.  Plans F and C pay Medicare’s Part B deductible ($2,096 this year). The other designs don’t pick that up, and neither does Senior Care. But the City reimburses us for it, and for any IRMAA surcharges, as long as we get a pension and take one of its health care plans. That’s a real blessing, but negotiations led to Senior Care’s own $50 annual deductible. True Medigaps don’t have this feature at all.

• Still another difference.  Senior Care handles inpatient hospitalization differently from true Medigaps. The F, G, and N all pay Medicare’s Part A deductible $1,632 per admission, and so do the less popular B, C and D plans. But, Senior Care does not pay that whole thing. We still have a $300 deductible per benefit period, to a max of $750 a year. That kind of limited deductible each benefit period in lieu of Original Medicare’s $1,632 deductible is exactly the kind of arrangement Medicare Advantage plans generally have.

As I’ve been saying, these things are what the unions and City negotiated for us. Senior Care is not a strict Medigap, but a hybrid mix, borrowing some characteristics from true supplements, and some from Advantage plans. 

In fact, look at our Anthem card and you’ll see at the bottom where it’s called a “PPO.” Then sign into your Medicare.gov account, and you’ll see that Medicare itself calls it a “PPO.” These are mine: card on left, Medicare.gov screenshot on the right:

“PPO” is the term most associated with Medicare Advantage plans, the two most common of which being the HMOs (Health Maintenance Organizations) and the PPOs (Preferred Provider Organizations). 

We have Original Medicare Parts A and B (through Social Security), yes, and supplemental insurance through Senior Care for the remaining costs, but not in the same way as open-market supplemental plans.  Our Senior Care supplemental coverage is through this hybrid kind of PPO plan. The other plans offered by the City are also kinds of “supplemental” coverage. 

Regarding the drug component. People without employer/union retiree coverage need to have drug coverage if they don’t want a penalty.  They either get a stand-alone Prescription Drug Plan (PDP) or an Advantage plan that includes drugs. Vets can get drugs through the VA.

We get the drug coverage through a “rider,” which is $120 a month if we have Senior Care and $178 a month if we have the HIP VIP HMO. They’re negotiated with the pharmacy benefit manager, Express Scripts. This is certainly drug coverage, but not a normal stand-alone Part D plan like the ones in the open market.  In fact, our coverage has an “open” formulary, which usually allows access to many more drugs than “closed” formulary coverage. How much the union has been involved with the creation of that formulary I have no idea. I just know those rider premiums are steep, I’m not crazy about them.

I’ve been accused of “using the insurance talking points,” but I would love it if people started using industry terminology. What I’m asking for is clarity – in our negotiations, in our responses to Mulgrew et al., and when we take to the streets to get the best retiree health care deal in this absolutely scandalous for-profit industry.

Prop 1 “YES” – kill the dangerous loopholes

The Prop 1 wording on the Nov. 5 ballot is not as clear as some people would have wanted, so we have to keep talking this up to make it sure it won’t fail. 

Here’s the message that needs spreading around:

 

All New Yorkers deserve the freedom to control our own lives, futures, and healthcare decisions, including our right to abortion. 

No New Yorker should be discriminated against, or taken advantage of, by those in power. 

Prop 1 is a NY state constitutional amendment that puts the power in the hands of New Yorkers, not politicians. 

This November, vote YES on Prop 1 to protect abortion rights and our freedoms.

From the NYCLU:

We might like to think we’re safe from these attacks here in New York, but the truth is there are dangerous loopholes in our state constitution that leave us vulnerable to the whims of politicians…

… laws aren’t enough, because they can be easily changed, as we’ve seen time and again in recent years as political winds shift.

When we enshrine a right in the state constitution, we protect it from political attacks.

That’s why we need Proposal 1, or what has been previously called the New York Equal Rights Amendment, which will protect our rights and reproductive freedoms — including the right to abortion. 

Proposal 1 will keep New Yorkers — not politicians — in charge of our personal decisions and will enshrine equal rights into our state constitution. 

More at New Yorkers for Equal Rights.

Make sure people know to look for Prop 1 on the ballot. Then vote “YES.”

 

So they just sacked CVS/Aetna prez Brian Kane

CEO Karen Lynch thought he really had to go when CVS’s income fell 9% in the 2nd quarter compared to last year at the same time. 

Mulgrew should be thrilled, then, that Marianne and the courts forced him out of the Aetna plan he built for retirees a couple of years ago. 

Whew. Dodged a bullet.


Hardly. 

Mulgrew couldn’t have cared less what would have happened to the retirees after a year or two when Aetna’s promises would no longer be viable. Prior authorizations won’t get in your way, he told us. Almost everything is free, you can see any doctor you want, go to all the hospitals you want.  What don’t people understand? The plan is the cat’s whiskers and all that.

According to Forbes, parent company CVS was having problems with its insurance businesses (Aetna) – particularly with Medicare Advantage, which had seen “higher costs from increased utilization of services from seniors.”

Wendell Potter puts it much more simply. The company was paying out too many claims in its Advantage plans. Brian Kane wasn’t doing his job.

Potter reports that CVS is planning to get rid of about 10% of Advantage enrollment, leaving these unfortunate rejectees to look around for the best personal health care solution in a swamp of underwhelming options. And looking to turn things around, CVS is apparently planning some operational changes described in this bit of corpo-speak:

It will initiate a “a multi-year expense management opportunity to deliver $2 billion in savings” that will include “streamlining and optimizing operations and processes.” Executives also plan to accelerate the use of artificial intelligence and automation across the company’s businesses.

We better start getting used to the health insurance strategies du jour,  which none of us learned about in high school. What’s become standard procedures in this for-profit industry is mind-bending obfuscation in how they work, coupled with our deep belief that a serious health catastrophe might leave us stranded physically and financially. 

In a guest column I wrote for the Examiner a couple of months ago called “Navigating the Medical Maze” (here) I tried to highlight how thick the industry has become with insider strategies meant to help Them, not Us. 

We no longer know what to expect from our coverage when even simple terms like “hospital,” “out-of-pocket medications,” or “skilled nursing” don’t actually guarantee the cost or extent of services, the medications or the equipment we’re being prescribed.

Here’s the handful of terms I included in that article:

Upcoding.  When providers are encouraged to assign inaccurate or additional codes for procedures in order to trigger a higher reimbursement from public agencies such as Medicare.

Overutilization.  Decisions on medical necessity are often subjective. Overutilization is when doctors are incentivized to prescribe or charge more for services and equipment because they know public or private insurance is picking up the tab.

Defensive medicine:  When doctors recommend tests or treatments not so much for their patient’s benefit but to protect themselves from potential lawsuits. 

Click-and-close: a term (used at Cigna) to describe how the company encourages staff physicians to review first-stage or questionable denials as quickly as possible, neglecting time-consuming research into guidelines, medical studies, and medical records. More money stays with the insurance company and often keeps patients from getting the vital but more complicated services they might need.

Direct-to-consumer advertising:  When patients are encouraged to ask their doctors for specific drugs, tests or equipment, a practice that frequently puts the doctor in the position of having to explain why these may not be in the patient’s best interest.

Pharmacy benefit managers:   These middlemen between insurance companies and the pharmacies run every aspect of the delivery of prescription drugs, from formularies, to prior authorizations and co-pays, to rebates. They profit at almost every stage in the supply chain.

Kickbacks: Rewards to medical professionals for prescribing specific procedures, equipment or drugs. Free vacations, cash, speaking positions, and research grants are some of the many kinds of gifts that can call into question the value of what you’re being prescribed.

That was a short list. We could easily add AI and automation to it, both of which just slipped off the tongue in the Forbes article.

I KNOW that Mulgrew is out of his depth with this stuff, just like the rest of us. 

How on earth do we get the union to put people in charge of these decisions not only to get us the best deal with this corrupt industry, but to stop pretending they know what they’re doing and stop lying to us to make us believe they’re on our side.

What’s going on with corrective legislation, fed and NYS

All stuck in committees.

I’ve updated the page tabs at the top of this website with recent bills and related info in five categories.

Under the tab Medicare for All

Just some background info on this topic.

Under the tab In Congress

Bills relating to Medicare for All.  They’re all sponsored and co-sponsored by Democrats, with the exception of our favorite spokesperson on this issue, the Independent senator from the great state of Vermont, Bernie Sanders. 

     NEW!  Added to the list of items and services in the most recent MfA bills (S.1655 and HR.1655) that are “medically necessary or appropriate to maintain health or diagnose, treat, or rehabilitate a health condition” are “gender affirming care, and reproductive care, including contraception and abortions.”

     The Senate version calls for a 4-year transition, the House version 2 years. The Senate bill got referred to a single committee (Finance), the House bill to seven of them.

     In addition to these bills, there are two letters from legislators – still only Dems + Bernie – asking for more protections against Medicare Advantage plan abuses.  

Under the tab Medicare Advantage

Lists some of the more important bills attempting to rein in the shenanigans of for-profit insurance companies.

Under the tab Pharmacy Benefit Mgrs

There’s much more bi-partisanship in these bills, but I’m not sure why.  

Under the tab New York Health Act

What’s going on with Single Payer in New York State.  

Mulgrew’s new resolutions: an exercise in futility

It’s hard to figure out what the heck Mulgrew’s saying when he talks about Medicare. I’m not even sure he knows himself.  

I’ve only been able to keep up with the UFT’s shenanigans with retiree healthcare by following Arthur Goldstein over at Union Matters, who’s indefatigable and we all benefit from reading his detailed posts. Kudos also, of course, to Marianne Pizzitola for the lawsuits she and the NYC Retirees pushed through the courts. We’re obviously safer and less financially stressed than we would have been without their fortitude and skills.

Yesterday we got a letter from Mulgrew telling us that said he had motivated a resolution on the AFT floor to seek federal legislation to protect Medicare and see it would never be diminished. “Our members pay into Medicare and Social Security throughout their careers, and we cannot let opponents chip away at these programs.”

It’s obvious that everyone who has a job pays into Medicare and SS. You don’t have to be a member of a union to want to keep these programs going once you’ve paid into them all your working life. Where could he going with this? And why now?

Maybe the Resolution he attached would clarify his position, so here it is in full: 

The First of the four Resolved clauses calls for “improving ... our healthcare safety net, including ... Medicare.”  That’s where I start to lose him. Is Mulgrew wanting to improve Medicare itself, meaning “Traditional Medicare” – Title XVIII of the Social Security Act created in 1965, the foundation of senior healthcare arrangements for all enrollees nationwide? Fighting for Traditional Medicare has never been on the UFT agenda as far as I know. It’s hardly within its purview.  

Perhaps, Mulgrew’s conflating two very different things: Traditional Medicare (=TM) on the one hand, and a TM + a supplemental arrangement of some kind – a combo, as it were – that the unions do have some control over. One of these arrangements that adds to TM is Senior Care, others offered by the OLR are Advantage plans. These plans are additional to TM. The union negotiates them with private companies to pick up what TM does not pay for, and without them, the sickest of us would certainly go bankrupt. The graphic left shows the differences.

The UFT has neither protected or improved our safety net over the past few years, which is why those courageous retirees filed lawsuits to block what was being foisted upon us. And they won: the courts ruled against the changes, saying these proposed arrangements would indeed cause irrevocable harm.

So right here in this First resolved, I’m not sure I know what part of healthcare delivery Mulgrew is trying to protect and improve. Might be Traditional Medicare, but he might want to be protecting the whole shebang:  TM + one of the supplemental arrangements in the blue and green parts of the chart.

The Second resolution is practically meaningless. No candidate at the federal or state level is currently trying to find a real solution to preserve “high-quality and affordable benefits.” The only way to do that would be to change the tax structure and cut the ravenous middlemen corporations out altogether – those giant entities that have taken over the healthcare industries from top to bottom, eating up Medicare dollars. That solution would be Single Payer, and I don’t hear anyone talking much about it these days. 

Like the rest of us, legislators seem to be stuck with the current healthcare delivery system, dependent as they are on lobbyist moneys that have been thrown at them to keep them from making too many waves. 

REMEMBER:  Traditional Medicare leaves a lot of costs on the table. Medicaid picks those up for people with lower incomes, and the rich can afford to pay them out of pocket.  It’s the middle-income people like us who feel the changes – in our pocketbooks when premiums, deductibles and copays change, and physically, when services and drugs are denied. The UFT has always favored the status quo, which is TM + private supplemental arrangements. It has fiercely opposed Single Payer, thwarting all attempts to eliminate those profit-driven middlemen companies. 

As for the Third resolution:  there are no “simple solutions” to healthcare. (I don’t even understand what Mulgrew means by “simple solutions to necessary changes” – and I don’t think he knows either.) If by “earned benefits” he’s referring in part to Traditional Medicare, that program has in no way been entirely successful or comprehensive. So much is left to Wall Street and monopolistic private entities. Nor do I think Congress would ever actually get rid of Traditional Medicare.  Not everyone has a sugar daddy like Clarence Thomas to pay their mother’s bills.

Now for the Fourth, where Mulgrew says they’ll seek federal legislation to ensure that Medicare and SS won’t be diminished. Exactly what form will that “seeking” take? The AFT won’t find big solutions with the lobbyists. And even if they could all agree to tweak something somewhere somehow, Mulgrew’s basically saying that TM is pretty good – even though you need supplemental insurance to pick up that hefty hospital deductible and a ton of copays for lengthy hospital stays, a Part B deductible, copays and 20% coinsurance for outpatient services or equipment. The Part B deductible is out of pocket, unless you’re lucky enough to be in a union that reimburses you for it. Because that’s how Traditional Medicare works on its own, no supplemental coverage to pay these parts of it.  Part D is not even contained in Traditional Medicare. It’s all managed by private companies, getting funds from the government.

I do want all that to change.  I don’t want the premiums, deductibles, copays in TM. Is TM what Mulgrew and the AFT want to protect?  

I’m thinking not.  I’m thinking Mulgrew just conflates Traditional Medicare (Parts A and B on their own, no supplements) with the way the union delivers Medicare to us, which is TM + the private, for-profit “supplemental” plans that keep us from going bankrupt (Sr Care and the Advantage plans).   

If I’m correct, it means he favors a system where pieces of our benefits are controlled by industrialists who want to make money off of healthcare. That system most definitely will never be in our interest, and he shouldn’t be spending our dues money trying to shore those plutocrats up.

Yummy!

I really enjoyed reading this message from Wendell Potter’s Health Care Un-covered where he says:

Our reporting and advocacy is having an impact, in Washington and across the country. Members of Congress on both sides of the aisle and the Biden Administration are beginning to scrutinize and crack down on the business practices of Medicare Advantage insurers. And there is growing evidence that employers, including county and municipal governments that planned to force their retirees into Medicare Advantage plans . . . are having second thoughts. Those employers are learning that they may have been sold a bill of goods – and misled and outright lied to – by insurers that make huge profits from their Medicare Advantage business.

Potter draws heavily on a recent ProPublica report pointing out that patients are being “cheated” by Advantage plans ignoring state laws regarding life-threatening conditions.

Across the country, health insurers are flouting state laws like the one in Michigan, created to guarantee access to critical medical care, ProPublica found. Fed up with insurers saying no too often, state legislators thought they’d solved the problem by passing hundreds of laws spelling out exactly what had to be covered. But companies have continued to dodge bills for pricey treatments, even as industry profits have risen. ProPublica identified dozens of cases in which plans refused to pay for high-stakes treatments or procedures — from emergency surgeries to mammograms — even though laws require insurers to cover them.

Apparently, “thinly staffed state agencies” don’t bother investigating a denial unless a patient files a complaint. State agencies are in a position to investigate patterns of improper denials, but generally do not, at least in Michigan. Only when someone complains, I’m assuming in the form of an appeal. 

And this from a ProPublica article this past month, “Health insurers have been breaking state laws for years”:

Over the last four decades, states have enacted hundreds of laws dictating precisely what insurers must cover so that consumers aren’t driven into debt or forced to go without medicines or procedures. But health plans have violated these mandates at least dozens of times in the last five years.

Companies find ways to “weasel out” of paying for benefits that cost big bucks. If the law requires them to cover “cancer drugs,” for example, they’ll just call it something else — like, I don’t know, “gene therapy.” Poof. No need to pay.

Thirty years ago a Michigan doctor and state senator named Joe Schwarz helped write a law requiring companies to pay for cancer drugs that would make chemotherapy more effective. He thinks “You shouldn’t split hairs between the term gene therapy and the term chemotherapy or the term radiation therapy or the term surgical therapy. They’re all cancer therapies and they should all be covered.”

Most salient is the point made by one patient’s widow:  “Insurance is meant to protect people ... not to make them fight through the last day to get what they should.”

I’m with her. 

So every time groups like the one Potter runs, or ProPublica, or PNHP, or Public Citizen, or the Center for Medicare Advocacy report on the scandalous ways Advantage plans bump up their profits at our expense, I can’t help but salivate. 

I truly despise these sociopathic business models, and I hope our municipal unions stop going down such antisocial, nefarious paths.

The OLR gets an “S” – for “Sloppy”

I just tried to change my health plan and couldn’t trust any single thing in the application process.

Changing health plans is a very scary thing for older people, especially when we have no idea how the Russian roulette of life will turn out for us in the coming year.

But the OLR made the process so much worse than it needed to be. Their website was loaded with incomplete instructions, missing forms, awful ambiguities, and buggy software.

With no way to complete this application on my own, I had to call the UFT Welfare Fund to solve its mysteries. Fortunately, the rep there was great. But why on earth did I have to go through her to get this thing done. 

Here’s what I just wrote the OLR, even though I have zero expectations that they’ll fix anything or even care. After all, the site still has all the Aetna info on it (as if any of that is relevant), and if you call one of their phone numbers, the recorded message from months ago is still telling people there’s going to be so many workshops to help us understand the new – now court-stopped, defunct – plan.  

I just sent a version of this to Tom Murphy as well.  If I’ve done something wrong in this application process, I’ll own up to it, call myself a dodo bird and apologize.  But in the meantime, what I found out may be useful to others who are trying to switch plan now during the November change period.

_________________________________________________________________________

Dear Sirs:

I am writing to describe to you the difficult process I went through yesterday trying to change from EmblemHealth HIP VIP to GHI Senior Care.

I still am not 100% sure that I have done this correctly, as so much was not explained clearly on the OLR website for Retirees: https://www.nyc.gov/site/olr/health/retiree/health-retiree-responsibilities-assistance.page.

Here is a list of things that I needed to get help with by calling the UFT Welfare Fund. All problem areas are in red ink.

1. From the above link, I clicked “Health Benefits Program Retiree Application” (https://www.nyc.gov/site/olr/health/retiree/health-retiree-forms-and-downloads.page).

It directed me to submit forms electronically using the link:  https://nycemployeebenefits.leapfile.net. There were two categories that could apply to my situation:

• Retirees only - Health Benefits Application (Retiree enrollment)
• Changes (address changes, death certificate, Medicare cards, etc.)

You can see the problem: I am a retiree and want to enroll in a different plan. Should I click the first link (Retirees - Health)? or the 2nd link (Changes)? I don’t remember which I one I did, but they both seem to lead to the same cover screen. I wrote a message and selected files to send individually.

2. Back to the Retiree page to get the forms. I clicked on “Health Benefits Program Retiree Application” but the DATE OF BIRTH cell did not accept my date of birth because of a bug. So I could not fill it out electronically. Instead I had to print it out, fill it in by hand, and scan it to the computer to submit electronically.

3. I did not know how to fill in some of the other boxes and had to call the UFT Welfare Fund to ask for help on these things:

(a) That change form asks for “Pension no.”  I checked my TRS account, and the only nos. listed there are called a “Retirement no.” [starts with “U”] and a “Membership no.” The UFT rep told me to use “the one with the U”. Who knew!@?

(b) After the box for name of current health plan is a box for “MBI NUMBER”. I had no idea what that was – my Medicare ID? my plan enrollment no.? The UFT rep said “Don’t worry about it,” as it wasn’t needed.

4. The UFT rep told me I actually had to upload TWO forms – the change form above, plus a disenrollment form for my current plan. That was not mentioned on the website, and I could not locate a link for that 2nd form either. She had to send it to me by email.

c) That form asks for an “effective date,” but I wasn’t sure which date should be there. Does it mean to enter the last date that my current plan should run to (end of year: Dec. 31, 2023) or end “by” the first date of the new year (Jan. 4, 2024). It would be clear if the wording were more specific, like: “Final date of current plan.”

5. I asked the UFT rep whether it was better to send electronically or by mail. She said “do both.”

6. When I submitted electronically, the software said “Success,” but how do we trust that message where there is no date or other details of the submission. I would have liked to take a screenshot (if details were there) or receive an email from the software that my documents were received.

7. I am now supposed to wait 4 - 6 weeks to see if this goes through??????  That’s insane.

Please can you tell me if you have received my application for change of health plan and that everything is in order.

I'm switching.

I just found out staying in the union’s HIP VIP Premier (HMO) will cost me $2K next year. And as far as I know, I’m not even sick.

That’s because the HIP plan, which has honestly served me well all these years, has a nasty little cost I had overlooked. 

Part B drugs are covered at only 80%, which means an out-of-pocket 20% when I need to get one of those twice a year.

GHI Senior Care doesn’t do that, and the new Aetna plan wouldn’t have either.

Here’s how this happened, and why I didn’t expect it.

Doctor recommends a “shot” to boost bone density. I have to get this thing at a facility, in my case, the infusion center at the hospital. First time round, no bill – and I hadn’t expected one either. I thought a shot’s a shot, always covered, even though I know Part B drugs don’t always work the same way in Medicare as Part D drugs. I still thought the union’s got me covered. 

So I take the 6-month repeat dose of this thing a month ago and get a bill yesterday for $1000. That can’t be, I’m thinking, it must be a coding error. So I called the plan only to find out it’s correct, I need to pay 20%. 

Why wasn’t I billed first time round?  Because something like this needs pre-certification by the doctor before the plan pays out. The first time, the office staff had failed to go through that process with the plan, so the plan wouldn’t pay out. The office also missed a 3-month window to correct the situation and had to actually eat that mistake, they weren’t allowed to pass the cost on to me.

Learning the bitter truth of biannual bills at $1000 a pop for the rest of my life, I checked the comparison documents on the OLR site to see what Senior Care people pay for Part B drugs.  Results were clear: my HIP plan charged me 1000 times what the other two were charging (except for a $50 deductible in GHI).

So if I stay with my HIP plan into next year, I will definitely be stuck with $2000 or more a year for those useful shots. If I switch to Senior Care, there will only be that $50 deductible.  

As I said, no brainer. Have to switch.

And now a word about our union "collaborators"

Obviously the situation has calmed down and we’re not being shoved into a plan that so many people have objected to for the moment, though I’m sure they’re working on it. 

When I say “collaborators,” I mean CVS/Aetna of the proposed but stalled new plan, and Cigna for our dental arrangements, though that one has not yet been structurally tweaked. 

So I was interested to read Wendell Potter’s recent essay on the size of the revenues that seven of the big health insurers have reported. Why am I not surprised that our two are included in this super avaricious group of megacorporations. 

Potter warns that “Wall Street’s unhappiness goes a long way toward explaining the double-digit premium increases many American employers and families will be hit with come January 1, 2024.” 

Investors don’t seem to have been satisfied with the profits the insurance companies have been making this past year, at a time when many of them used AI and other means to deny coverage for needed care and reject legitimate claims en masse. Potter tells us that revenues and profits did, in fact, rise.

As a group, the companies (Centene, Cigna, CVS/Aetna, Elevance/Anthem, Humana, Molina and UnitedHealth Group) saw their total revenues increase from $618.2 billion in the first half of 2022 to $683.8 billion during the same period this year.

In spite of profits up from $37 billion to $40.2 in a year, investors thought they’d better shift their money elsewhere to get an even better return on investments. That resulted in the stock prices of these companies going down this past year: while Dow, S&P, and Nasdaq shares went up, Cigna’s went down 23.2% and CVS/Aetna went down 27.7%.

“It’s not that the companies aren’t growing. It’s just that at least some of that growth has not been as profitable as Wall Street demands.” Apparently, these companies were paying more in claims than Wall Street was finding “acceptable.” 

BOY, ARE WE IN TROUBLE.

Because, as Potter says, “most of the companies’ growth continues to come from the taxpayer-financed Medicare and Medicaid programs.”  

And because 3 of them – our Cigna and CVS/Aetna buddies plus UnitedHealth – control 80% of the Pharmacy Benefit Manager (PBM) market and now operate their own practices and clinics, they can shift monies around to keep their medical loss ratio low (which means less spent on our health care and more on overhead and profits.)

Here’s Potter’s scary conclusion:

To get back into Wall Street’s good graces, you can expect the companies to try to squeeze more money out of their commercial customers in the form of higher premiums and out-of-pocket requirements; boost enrollment in their Medicare Advantage and Medicaid plans; and refuse to pay for more doctor-ordered care and medications.

But you can read the whole thing yourself if you want to know more specifically why you’re about to throw up.

Somebody shoulda thought this through

The ruling on the Aetna PPO just in . . . it's not happening. 

For now. 

NYSCEF DOC. NO. 101
PRESENT: INDEX NO. 154962/2023
RECEIVED NYSCEF: 08/11/2023
SUPREME COURT OF THE STATE OF NEW YORK NEW YORK COUNTY
HON. LYLE E. FRANK
---------------------------------------------------

ROBERT BENTKOWSKI, KAREN ENGEL, MICHELLE FEINMAN, NANCY LOSINNO, JOHN MIHOVICS, KAREN MILLER, ERICA RHINE, ELLEN RIESER, BEVERLY ZIMMERMAN, THE NEW YORK CITY ORGANIZATION OF PUBLIC SERVICE RETIREES, INC.,
Plaintiff, 

-v- 

THE CITY OF NEW YORK, ERIC ADAMS, THE CITY OF NEW YORK OFFICE OF LABOR RELATIONS, RENEE CAMPION, THE NEW YORK CITY DEPARTMENT OF EDUCATION, DAVID C. BANKS,
Defendant. 

DECISION + ORDER ON MOTION

The following e-filed documents, listed by NYSCEF document number (Motion 001) 44, 50, 95, 96 were read on this motion to/for INJUNCTION/RESTRAINING ORDER .
On June 5, 2023, the Court issued a preliminary injunction in this matter. The Court has been informed by the parties that they do not wish for the Court to hold any additional argument, nor will there be further submissions. As such, this matter is ripe for a final determination. 

The Court therefore grants the petition for the reasons indicated in the July 6, 2023, namely that both the doctrine of collateral estoppel and the provisions of New York City Administrative Code Section 12-126 bars the actions sought to be taken by respondents. The Court does not reach the last point of relief in the petition, namely that the respondents should be enjoined from disseminating alleged false and misleading statements of the Aetna Medicare Advantage Plan. 

Based on the foregoing, it is hereby ORDERED that the Respondents are permanently enjoined from requiring any City retirees, and their dependents from being removed from their current health insurance plan(s), and from being required to either enroll in an Aetna Medicare Advantage Plan or seek their own health coverage.

Have to say I wasn't surprised by the Judge's comments a couple of weeks ago.

Now what's the city gonna do.

There's more than one boogeyman

While a whole bloc of retirees are fighting tooth and nail against the new Aetna PPO, I want to take a moment to say something about the company Senior Care uses to supplement Medicare Part A:  Empire BlueCross BlueShield.

Its name is changing on January 1st to Anthem Blue Cross and Blue Shield. You can see it in the banner on its webpage. 

Does that mean it will convert to a for-profit company? Because Anthem became publicly traded in 2001.

Fast forward to February 2022 when Ednotes reported that in spite of a lawsuit still pending against Anthem for fraudulent practices, NYC chose that company to to provide its workers with healthcare coverage.

A few months after that, Anthem shareholders rebranded the company to Elevance Health. Its CEO, Gail Boudreaux, is quoted to have said “this change is the next important chapter in our journey, and better reflects our business and the company we are today.”

For that kind of pap she earned big bucks that year: $20,931,081, according to this report. It included $1.6 million in salary, $3,840,000 in non-equity incentive plan compensation, $11,100,128 in stock awards, $3,699,929 in option rewards, and $691,024 for all other compensation, whatever that was but I’m sure it wasn’t ham sandwiches at the local deli.

The for-profit / not-for-profit debate is getting to be ridiculous. Why one website lists Empire Blue Cross Blue Shield in the publicly traded column and another says it’s not-for-profit is beyond comprehension. This one and this one cleverly avoid saying one way or the other. 

I can understand when retirees demand that the city follow legislative codes stipulating what it has to pay for our coverage.

I can understand their anger against middlemen insurance companies soaking up Medicare funds, denying or delaying coverage, juicing up profits, and seeing all of us as consumers rather than patients. I’m angry about all that as well.

What I can’t understand is why people see Aetna as the only boogeyman on the scene, when for-profit insurance companies or their counterparts have been part of our healthcare landscape for years. If it’s not CVS Health/Aetna, it’s still Empire/Anthem/Elevance Health, and it’s still CVS Caremark/SilverScript.

And they’re not the only ones. The chart on the left shows the top Medtech salaries in 2020 (from here) – look at Helmy’s.  $113.9 million!   The one on the right the top Pharma salaries in 2021 (from here) - look at Ari’s. It’s a lot more than Gail’s.

We have to focus our wrath on the lot of them, not just Aetna, Aetna, Aetna.

What happened to the "optional" rider?

If you’re enrolled in the Senior Care health plan, you don’t have to take the $125/month rider for drug coverage through Express Scripts. Both the book and the UFT webpage say it’s is “optional,” you could get a stand-alone plan from the open market (listings at Medicare.gov), or from the VA, or not at all. Up to you. 

But, most everyone I know who’s in Senior Care takes the rider. It’s the same as a premium, except we get reimbursed for a lot of it through the “City Optional Rider Reimbursement Benefit.”

A question recently came up about whether the rider in the proposed Aetna PPO arrangement is also “optional.” Would you be required to take the SilverScript plan for meds if you moved into the new PPO?

I tried to answer this on my own from the OLR materials, from which this screenshot has been taken of the top of the p. 9 in the FAQ brochure:

The last paragraph above says two things. First, that once you allow yourself to be moved into the Aetna PPO, you’ll be automatically disenrolled from any stand-alone drug plan you may have, and secondly, that you’ll “need” to get drug coverage through your union or through a drug rider. 

What’s not particularly clear is the difference between obtaining coverage through “your union” or “by purchasing the prescription drug rider.” Do some of the city unions offer a drug plan directly and others through a welfare fund?  This article says that “many” of the city unions established welfare funds for drugs and other benefits, which implies that not all of them do. Certainly the big ones like ours have welfare funds. Is it saying that the unions who don’t have welfare funds offer drug coverage in some other way? 

Also not clear is the phrase “You will need to obtain ... coverage.” Does that mean if you want drug coverage at all, you’ll have to get it in one of the ways mentioned, or can you in fact choose not to get a drug plan at all?  It probably means the former, that the rider is no longer optional: if you take the Aetna PPO, the drug coverage comes with it and the cost will be $103.50/month. If the latter, it means the rider is still optional, in that you could sign up for the PPO but choose not to have any drug coverage at all. 

(Parenthetically, if you don’t have creditable Part D coverage for two months, Social Security will slap you with a penalty once you rejoin the Part D system, but some people do make that choice. For example, they may get their drugs from abroad, or from a spouse's plan, or feel so healthy they’ll take their chance for a year. Admittedly those cases are rare.)

I decided to make some calls to see if someone could clarify these points. Starting with the Aetna hotline, the rep told me that since the plan is now on hold, they were not able to advise us properly. They might renegotiate certain items. The bosses had, in fact, removed some of the notes the staff had been relying on to clarify what was in the manuals. The rep did end up writing a ticket for her superiors to check out the wording on p. 9 of the manual and tighten it up. 

That got nowhere, so I called the UFT Welfare Fund. The first rep couldn’t help, but she passed me over to someone who was more specialized in the medical questions. From that person I got three definitive statements, the main one being: “There is no Aetna plan.” There was no point in clarifying anything about the new PPO because it does not exist at this time and she could only really answer questions about our current health care. 

She then confirmed that the current rider is indeed optional for Senior Care people, that you could go in the open market and buy a stand-alone plan if you wanted to.

And after I posed the hypothetical question that if the Aetna deal were to go through and you allowed yourself to be enrolled in it, would you be required to get the rider?  

Her answer:  Yes, you’d have to take the rider, it would not be optional.

What, no outrage over Part D?

One of the reasons I haven’t been able to get totally on board with the protests against the new Aetna plan is that Medicare has from its inception left a lot of coverage costs on the table. Legislators either didn't care you'd be out of pocket for these, or they were comfortable with insurance companies picking up the remaining costs they didn't want to cover. 

The deductibles, coinsurances and copays that Medicare does not pay for are significant, and you’d be crazy not to buy a Medigap to help with these bills.

The companies that sell Medigaps are pretty much the same ones that sell Advantage plans, and sometimes even stand-alone drug plans. The for-profit ones are driven to make money for their shareholders, but those that are private are still middlemen entities that incur typical middlemen admin expenses.

Except for the shareholder aspect of the business model, I don’t as a patient see much of a difference between the way the public and private ones operate. All of them use mechanisms to delay or deny care (e.g., prior authorizations), and all of them make extra money off of Medicare and Medicaid (e.g, by encouraging upcoding and unbundling). These and other questionable practices are normal operating procedures whether the company is private or public. The goal of either kind is to stay afloat and make money.

When the government added Part D for prescription drugs in 2006, that whole new part of Medicare got put into the hands of insurance companies. Unlike with Parts A and B, there’s no such thing as governmental Medicare for prescription drugs. Part D is entirely run by middleman companies, or as CMS calls them, “Part D sponsors.” (I wrote about these and the Pharmacy Benefits Managers last week, the PBMs being the intermediaries between insurance companies and the drug manufacturers, entities that manage drug spending, rebates, claims, pharmacy networks, mail-order, and other components in the distribution chain.)

The city negotiates Part D Medicare for us, so let’s talk about that for a minute.

According to a Citizens Budget Commission report, members of municipal unions get “generous health insurance benefits at a significant cost to taxpayers,” with NYC funding hospital and medical insurance centrally for all the workers and retirees. 

But additional benefits – dental, optical, prescription drugs, etc. – come through the unions' benefit funds, specifically the welfare fund of each union. The CBC says these funds are supported primarily by city contributions on a per capita basis, and each union works its own fund separately in accordance with the trust agreement it has with the city. Retirees nevertheless pay a hefty rider for the plan they come up with.

On the open market, Medicare Advantage plans usually include Part D drugs in addition to the benefits of Parts A and B, but it doesn’t work that way with our retiree coverage. The proposed Aetna PPO will not include Part D. Instead, Senior Care members will be transitioned from Express Scripts (or whatever drug plan they now have) into a negotiated Aetna Medicare Rx plan run by SilverScript. The UFT website says: 

It [will not be] not part of your Aetna Medicare Advantage PPO plan. You will receive a separate Aetna Medicare Rx/SilverScript member ID card for prescription drug services.

Presumably if you stay in the Emblem HIP VIP HMO, the drug component will still be managed by Express Scripts. Both SilverScript and Express Scripts resemble the stand-alone Part D plans in the open market, but they're structurally different from them. The stand-alones in the open market are entirely separate from Medicare Parts A or B or the Medigap you might purchase to help with remaining medical costs. But in the union arrangement, the rider can only get you the SilverScript plan when you have the Aetna PPO or Express Scripts if you have the Emblem HMO.  

I just went to the Medicare plan finder to see which companies offer non-union stand-alone Part D plans in the NYC area, and lo and behold: each of the 7 listed in the search results are all themselves publicly traded companies or owned by one:

• SilverScript (owned by publicly traded CVS Health)
• Cigna (publicly traded; mail-order Express Scripts)
• Humana (publicly traded)
• Wellcare (owned by publicly traded Centene; mail-order through CVS)
• AARP Medicare Rx (offered through publicly traded UnitedHealthcare)
• Empire BlueCross BlueShield (owned by Elevance Health – was Anthem, which became a publicly traded in 2001) 
• Elixir (owned by publicly traded Rite Aid)

So as I read about the tremendous outrage and street protests against the new Aetna PPO, I can’t help wonder why there haven’t been equally forceful demonstrations against the way seniors have to get their meds through these for-profit insurance companies and PBMs.

Actually I know the answer: the pharmaceutical industry is just too big to fail. 

With the whole of Medicare Part D run by insurance companies, we’ve come to just accept them. And when that happens, all we can do is look around for the best priced plan for the specific drugs we take. If like in our case there’s a welfare fund running the show, it’s more of a take-it-or-leave-it situation. I’m not sure greater transparency negotiating these plans would help: the whole industry is unbelievably complicated and riddled with fraud.

Perhaps the union looks for the best Part D deal it can get. Rank-and-file members are mostly oblivious. Some have taken to the streets against the new Part A, B and C the city is cooking up, but everyone in the unions has turned a collective blind eye to the absolute scandal of the Part D design and how it’s morphed into a monster. It's a legislated for-profit enterprise we’ll never get rid of in our lifetime.

If people are going to get all up in arms, I’m thinking they should have started doing it decades ago against Part D, way before the Aetna PPO became became a twinkle in Mike Mulgrew’s beady eye.

Keeping track of the Aetna mess (part I)

I had to make a timeline for a workshop I ran, so thought it might be useful to put it up here. 

Much of this history I got from the PSC CUNY union website, particularly What’s Happening to Our Healthcare.  It all started in 2018, when the city shifted new hires from EmblemHealth to HIP

June 28, 2018 – OLR-MLC agreement set a $1.1 billion target in healthcare savings to be generated between 2019 and 2021, and “for every fiscal year thereafter $600 million per year . . . on a citywide basis.” Sustainability would need to be studied by special Committee. Eight large topics are outlined, but PSC says they only “seriously considered one, reaching for the low-hanging fruit: retiree health benefits” (see History and Timeline).

I'm skipping to . . . 

July 2021 – The massive restructuring was announced. By January 2022, the city would (a) move people by default into a MAP (an EmblemHealth and Empire Blue Blue Shield partnership called the Alliance), and (b) let them opt to stay in their supplemental care program if they paid a premium of $191.57/month.

Oct 2021 – LAWSUIT 1 (NYC Org’n of Public Service Providers)
Judge blocked this lawsuit over implementation: the city hadn’t established an accurate list of providers and sent retirees a flawed enrollment guide.
https://nysfocus.com/2021/10/20/retirees-flee-medicare-advantage/

                   LAWSUIT 2 (Aetna against the city, violations in the bidding process)

Dec 2021 – Judge extended injunction to stay implementation until April 1, 2022.

March 3, 2022 – Judge ruled that the city charging a premium would violate §12-126 of the city’s Admin Code (enacted 1967), which stipulates that “the city will pay the entire cost of health insurance . . . not to exceed 100% of the full cost of HIP-HMO.” City had argued it was following that law as long as it covered the full cost of one health plan, and that it could legally charge people a premium if they wanted a different plan. The city appealed and lost.
https://www.work-bites.com/view-all/retirees-win-in-court.  

July 18, 2022 – Anthem/Empire withdrew, ending this first effort.

Sept 8, 2022 – The MLC (which negotiates health insurance on behalf of city unions) agreed to propose a change to Admin Code to eliminate the HIP-HMO rate as single standard for determining city’s obligation to pay the full cost for employees, retirees, dependents. (In practice, when the cost of the Senior Care plan exceeds the HIP plan in a given year, the Health Insurance Stabilization Fund reimburses the city the difference.)  Under the new proposal, the city and MLC could agree on a different plan as the “standard” – or benchmark: for either retirees+dependents or for actives+dependents.
https://psc-cuny.org/news-events/psc-opposes-weakening-nyc-health-insurance-protections/

Nov 2022 – Appeals court rules retirees can’t be forced to switch to a MAP: Admin Code §12-126(b)(1) requires respondents to pay the entire cost up to the statutory cap of any health ins plan a retiree select.s
https://www.work-bites.com/view-all/retirees-win-in-court/

Dec 15, 2022 – Arbitrator cleared the way to switch retirees into a MAP (Aetna).
https://www.thecity.nyc/2022/12/15/23511966/mediccare-advantage-25-day-clock-from-abritrator-could-end-senior-care-innew-york-city

Jan 11, 2023 – Judge blocked the $15 copays.
https://www.nydailynews.com/news/politics/new-york-elections-government/ny-judge-blocks-nyc-charging-retired-workers-copays-20230111-4sbubgj6ujdgtlbjgytgbsfn2m-story.html

March 9, 2023 – MLC votes to accept Aetna MAP, as only alternative to HIP VIP (full Aetna contract not made available before the vote, but posted on March 10, 2023); City signs contract on March 30

May 25, 2023 – Appellate court affirmed Judge Frank’s Jan 11 decision blocking the copays.
https://iapps.courts.state.ny.us/nyscef/ViewDocument?docIndex=T7cQMiFRJdpEmd_PLUS_lMgmasQ==

May 31, 2023 – LAWSUIT 3 (NYC Org’n of Public Service Providers)
Seeks temporary restraining order against the Aetna plan, saying NYC violated city charter by not offering choice and violated state and city human rights laws prohibiting discrimination against disabled people. It also failed to follow proper procedures.
Documents: https://iapps.courts.state.ny.us/nyscef/DocumentList?docketId=_PLUS_IDYK0flEDapsoEVXJNmnw%3D%3D&display=all&courtType=New%20York%20County%20Supreme%20Court&resultsPageNum=1&fbclid=IwAR0LUAbRq8dHnk2C6YhIYmHeICHViyH8MjfiGEP9ahNglx2pWJn7wB-oRu0
About it: https://www.nydailynews.com/news/politics/new-york-elections-government/ny-nyc-retirees-sue-to-block-mayor-adams-new-medicare-advantage-plan-20230531-bnhtvbxonvfrle3gqwflqx5cxy-story.html

June 8, 2023 – Comptroller declined to register the Aetna contract because of pending litigation.
https://comptroller.nyc.gov/newsroom/comptroller-lander-declines-to-register-medicare-advantage-contract-pending-litigation/

July 7, 2023 – Judge issued temporary injunction blocking the move: the city can’t order retirees off the current plans.
https://psc-cuny.org/news-events/judges-decision-temporarily-blocks-aetna-medicare-advantage/
Court document: https://law.justia.com/cases/new-york/other-courts/2023/2023-ny-slip-op-32251-u.html/

I guess to be continued . . .

The biggest bog of all

A few months ago CMS issued its first guidance on the drug pricing controls legislated under the Inflation Reduction Act of 2022, and revised it last month (here). As everyone knows, Medicare couldn't until this legislation negotiate any drug prices with the industry – the VA being the only agency able to that – so I was hoping that the new law would remove those shackles quickly and irrevocably. 

But alas, only some changes looked promising (see the full timeline here), among them being: 

• 2022 – rebates to Medicare if certain Part D drug prices increased more than inflation
• 2023 – insulin caps ($35 a month per prescription)
• 2023 – free vaccines for seniors
• 2023 –  rebates to Medicare and lower coinsurances for certain Part B if prices increased more than inflation
• planned for 2024 – no copays or coinsurances for people in the “catastrophic” phase of Part D.

Also in the timeline, spread over many years, is the IRA’s new Drug Negotiation Program for dealing with overpriced drugs. It looks grindingly slow.

They’ll select the first 10 high-priced drugs – really? only 10? – in 2023, letting us know the negotiated prices for these in 2024, and putting the new pricing into effect in 2026. In 2025-2027 and 2026-2028 there’ll be two more groups of 15, and 2027-2029 another 20. More specifics in the new guidelines, but I don’t know how anyone could think this slow-mo program is fair to consumers.  

The city is wanting to move us from Express Scripts into SilverScript. There’s no premium for either of these plans. The laws governing the healthcare components the city has to pay for do not include drug coverage, so we get “riders” for medications through our welfare funds.  The SilverScript rider will be cheaper than the current one, but it's still more expensive than the normal Part D plans in our local area. That's because most employer-negotiated plans have “open” formularies, which means all drugs are included, some in expensive tiers. Premiums for “closed” formulary plans cost less because certain brand names and higher tier medications are excluded altogether.

An interesting group called PissedConsumer has published some polling on which plan people like better, Express Scripts or SilverScript. Apparently they’re both disliked pretty much the same. 

The sample of people polled is small, but it does not reflect contentment.

Both Express Scripts and SilverScripts are actually not plans but Pharmacy Benefit Managers. I first heard about PBMs in a recent chat with my local pharmacist, though most of what he ranted about quite honestly went right over my head. The gist of it was that middlemen PBMs play a huge role in the distribution chain, and lots of the other components — patients, pharmacies, insurers, employers, other payers — just have to play along.

According to an April 2019 post by the Commonwealthfund, 

“PBMs are companies that manage prescription drug benefits on behalf of health insurers, Medicare Part D drug plans, large employers, and other payers. By negotiating with drug manufacturers and pharmacies to control drug spending, PBMs have a significant behind-the-scenes impact in determining total drug costs for insurers, shaping patients’ access to medications, and determining how much pharmacies are paid.“

Here’s the graphic they adapted from a Congressional Budget Office document of January 2007:

The only thing I can figure out in this picture is that the PBM is dead center, big, and I won't be getting a handle on most of this in my lifetime. 

Here’s what I did got from the rest of the article:

• Rebates from the manufacturers (not publicly disclosed): Should PBMs be able to keep these or pass them through to insurers, who could then reduce premiums and copays? Pass-through amounts don’t always reach small insurers or employers. Reform would require PBMs to pass through rebates to patients. Reform would also require more transparency so federal and state policymakers could see what’s going on.

• Spread pricing: in the case of generics, insurers and employers reimburse PBMs more than what the PBMs actually pay pharmacies for these. PBMs keep the difference and the schedules are “kept confidential” from the health plans. Reform would ban spread pricing altogether, so that insurers and employers would not overpay. 

The recurrent themes in what I've been reading are the lack of transparency, the use of opaque contracts to maximize profits, shorting pills, selling patient data, misrepresentation, covertly shifting patients to higher-priced drugs, the pocketing of manufacturer rebates, and similar bad practices. Bottom line: nobody can figure out what’s going on. 

Katherine Eban writes in a Fortune magazine article of Oct. 28, 2013: 

Express Scripts vehemently insists it saves money for clients and that the vast majority are satisfied with its service. And like any company – to state the obvious – it’s entitled to a profit. The question is, Who is making out better – the PBM or its customers? Many experts say the former. They argue that many companies stick with traditional PBMs because drug pricing is so impossible to untangle that customers have no way to verify how much they’re saving, if anything.   ...  The PBMs’ claims of cost savings are difficult to prove or disprove. Drug pricing is an almost impenetrable bog.

She quotes a PBM auditor as saying: “The nation’s employers are being taken for a ride.”

And she says a VP of one of the more transparent PBMs puts it this way: “Basically it’s a ‘confuse-opoly.’ Buyers don’t understand the PBM industry, and that’s why they hire consultants – who don’t understand it either.” 

You’ll be paying different copays for your drugs in SilverScript. That’s what I found out when I priced my expensive drug over the phone at the number the OLR has been giving out for questions about the new plan: 1-855-648-0389. Maybe you’ll have better luck, but one of mine ended up way more expensive in the new SilverScript plan than what I’ve been paying in Express Scripts.

And the thing is, I’ll never know why.