August 11, 2023

Somebody shoulda thought this through

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

For now. 

PRESENT: INDEX NO. 154962/2023

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.

August 4, 2023

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.

July 27, 2023

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, 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.

July 25, 2023

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. And I don’t think greater transparency negotiating these plans would help: the whole industry is unbelievably complicated and riddled with fraud.

I think the city looks for the best Part D deal it can get, and 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.

July 21, 2023

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.

                   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.  

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.

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

Dec 15, 2022 – Arbitrator cleared the way to switch retirees into a MAP (Aetna).

Jan 11, 2023 – Judge blocked the $15 copays.

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.

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.
About it:

June 8, 2023
 – Comptroller declined to register the Aetna contract because of pending litigation.

July 7, 2023 – Judge issued temporary injunction blocking the move: the city can’t order retirees off the current plans.
Court document:

I guess to be continued . . .

July 14, 2023

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.

July 11, 2023

Brian Lehrer (WNYC) needs to do better

Granted this move to shove all of us retirees into Medicare Advantage is a huge topic, but if you’re going to bother to do a half hour on the temporary hold, please try harder next time.

Lehrer started yesterday’s segment with a sentence filled with disinformation:

“NYC government retirees – 250,000 of them about – have been bracing for, if not dreading, a major change in health care coverage from traditional Medicare with supplemental coverage paid for by the city to a privatized Medicare Advantage plan run by Aetna.”


Not all 250,000 retirees have been “bracing for” or “dreading” this major change, because not all of them have a “traditional Medicare with supplemental coverage” at this time. Just the ones in Senior Care, who don’t want to lose this arrangement where the city picks up the cost of a Medicare supplement and they can stay out of Medicare Advantage. The class action lawsuit says there are 183,000 retirees that have Senior Care, which leaves 67,000 who don’t.

The city actually offers at least seven plans to retirees living in the metro area, and other plans for people who live elsewhere. In the new arrangement, people in one of these, Emblem HIP VIP Premier, would have been allowed to keep it. 

The Emblem plan is already an Advantage plan, the most restrictive kind because it’s an HMO. I’m sure tens of thousands of people are currently enrolled in it, since it’s been around longer than the decade I’ve been retired. Maybe they’re in it because they had a version of it when they were working and didn’t want to change anything once they moved into retirement. Maybe they’ve kept it because Emblem is a private company and not publicly traded like Aetna, relying on its reputation as a non-profit insurer. In any case, I don’t think any of these retirees are doing any “dreading” or “bracing.” They seem to be getting the care they need.*  
*Saying that, I have friends who switched to Senior Care because a specialist they wanted was not not taking the Emblem plan. So, it’s not that these people got delayed or denied service, but they didn’t want the restrictions in choosing a provider or facility and preempted the situation.

The instructions for the July 10th deadline said do nothing if you wanted to keep your Emblem HMO and only let them know if you wanted to switch into the new Aetna PPO. 

Lehrer mentioned that only 1,600 retirees had opted out as of last week, but he did not tell us how many people chose to keep the Emblem HMO they have. Nor did the reporter on the show (Caroline Lewis) correct him, to clarify that a fair percentage don’t have Senior Care, but the Emblem plan. This omission skews the whole issue, because I suspect the thousands who decided to keep the HMO are either happy with it, or didn’t trust the transition to the new Aetna, or were just taking a “wait and see” position until November, when they’d have another chance to make a coverage change. 

Reporting on only part of the whole scenario is kind of like malpractice. The show made it seem like the all the city retirees are in same class action, whereas it’s only the ones who are losing Senior Care. As for the others who have the Emblem HMO, nobody is telling us how many of those people decided to keep what they have. That’s just bad reporting.

There was also some confusion relating to the cost of Medicare and supplements people would have to buy if they opted out. 

Responding to Lehrer’s question “What’s the cost for those additional city health benefits” if people do opt out, Ms Lewis must have just misunderstood the question: 

“Paying for the premium for Medicare Part B on your own and not having it through the city I think starts at around $165 and goes up depending on your income ... people might want to pay for a Medigap plan ...”

He was asking her about the cost of the “additional” benefits, meaning the ones Senior Care gives you, not Part B. Part A is free for most everyone, and she's right that there's a premium of around $165/month for Part B, more when income is higher. It's paid to Social Security and city retirees get that reimbursed if they remain inside the city system. But Lehrer wasn't asking about Part B, he was asking about the "additional" coverage they'd have to get if they were to opt out.

This almost obligatory extra coverage is not something that "people might want to pay for," as Ms Lewis says, but something they'd be a fool if they chose not to. Medicare leaves so many costs on the table that you need to have supplementary coverage, which can come through a Medigap, resembling Senior Care. There are 10 different kinds of these in the open market, with several companies in each zipcode competing for your business. Checking the plan finder at the NYS Dept of Finance for this month's choices in the metro, they range in price from the most comprehensive, never-see-a-bill type at $332/month to a high-deductible kind at around $68/month. (People could also supplement Parts A and B through a premium-free Advantage plan, but why would they want to do that when the city is offering Aetna PPO at no cost. That would be utterly stupid.)

Admittedly the subject is turgid and inscrutable, but the questions and answers on this program showed neither the interviewer or the reporter was up to the task.  So disappointing.

July 8, 2023

What a mess. Full stop.

That’s the email we got yesterday which proves at least one thing: the UFT knows how to keep us informed efficiently, clearly and rapidly when they want to – or when their back’s up against a wall.

The whole health care swap is on hold again now that the court has granted a preliminary injunction “enjoining the City from forcing retirees to switch from their existing healthcare benefits, and from being required to either enroll in an Aetna Medicare Advantage Plan or seek their own health coverage.”

Anyone can follow the reporting by googling it, but I’m most interested in some of the wording used in the legislation and rulings through the filings and appeals. NYC Admin. Code §12-126 is not entirely clear in the very first paragraphs. The first problems come in the definitions of “coverage” and “payment”:
a. Definitions
iv. “Health insurance coverage.” A program of hospital-surgical-medical benefits to be provided by health and and hospitalization insurance contracts entered into between the city and companies providing such health and hospitalization insurance.
b. Payment of health insurance costs
(1) The city will pay the entire cost of health insurance coverage for city employees, city retirees, and their dependents, not to exceed
one hundred percent of the full cost of H.I.P.-H.M.O. on a category basis.
No mention of “premiums” here. It says the city will be paying the “entire cost” of the coverage defined in clause a.iv. not to exceed the “full cost” of the HIP HMO, which could easily be interpreted to mean it would include copays and coinsurance in addition to premiums. Costs could also include the $50 deductible that Senior Care people have to pay out of pocket before the plan starts picking up Part B leftovers mounts, as well as the $300 deductible ($750 max per year) for each benefit period of in-patient service and the $50 deductible for an emergency room visit.

Judge Frank didn’t help when he quoted this ambiguous part in yesterday’s ruling:
... to this Court, section 12-126 does appear to be a codification that the City must pay “the entire cost of health insurance coverage”... the Code makes no mention of the word “premium” but rather uses the word “coverage.” 
What?  Is he saying the Code uses “coverage” for “premium” when these two terms do not equate? You pay a premium to get coverage.  He might have meant the Code doesn’t use the word “premium,” only the word “entire cost,” but who knows.

Apart from what costs the city is supposed to be covering, there’s also a problem with the phrase “on a category basis,” which even the appellate court ruled was unclear in November last year. It said “further evidence is necessary to determine, for example, the meaning of the phrase ‘on a category basis.’”

Judge Frank’s ruling yesterday was sloppy in the following excerpt, and not only because of two typos.  Writing about the Code, he stated just before the passage I already quoted above:
This section provides that “[t]he City will pay the entire cost of health insurance coverage for city employees, city retirees, and their dependents ... [typo 1, end quote missing] To this Court, this wording is unambiguous [Really? It’s ambiguous to me if you can’t tell from the wording whether “entire cost” means just premiums or premiums plus all the other costs in the plan] and applies to this matter. Moreover, the history of section 12-126 shows that the City intended to provide all retired employees health plans and intended to assume full payment for them. [Again, “full payment” to me means premiums plus the rest of the costs, not just premiums.] Gardener Aff., Ex. H at 27-28. This section was originally enacted through the City’s expanded powers, under a 1965 amendment to [NYS] General City Law § 20, passed around the same time as § 12-126, empowering the City to pay the “for [typo 2, I think it should have been “pay for”, not “pay the for”] premium charges for supplementary medical insurance benefits under the federal old-age, survivors and disability insurance benefit program.” ) [I don’t have access to the Gardner affidavit, but the § 20(29-b) of NYS General City Law he’s citing doesn’t use the word “pay” for premium charges. Instead, it says cities are empowered to “reimburse”retirees for premium charges. There’s part of the payment mechanism in here that’s not at all clear to me, since retirees can’t be “reimbursed” for something they never paid for in the first place. And if the judge is bothering to explain this history, he certainly left out an explanation of how “costs” in the Code got reinterpreted to mean just “premiums” by the NYS law.]
Wouldn’t it be nice to have somebody at any level of the judicial system clean this mess up.

Apart from all this and getting back to the Definitions clause above, it’s clear that the “health insurance coverage” as defined by the Code does not extend to prescription drugs, even though all of Part D is done through “health insurance” plans similar to medical plans. In fact, if you don’t have drug coverage for 2 months through some kind of health insurance plan, Social Security will slap you with a penalty that never will go away. Drug coverage is an essential part of health care. Without drugs, some people can't stay alive. Without drug coverage, some people can't afford to stay alive.

Not defining what “costs” are involved with coverage, not clarifying the term “category basis” at all, calling bits of legislation unambiguous when ambiguity clearly remains, and making strange word substitutions like the ones mentioned earlier doesn’t help us understand anything.

I’m going to be staying out of these court docs from now on. They’re really upsetting. 

But, I’m not intending to stop writing about how retiree insurance works, because I think most people haven’t the vaguest idea – of course through no fault of their own. It’s really a dumbass system we have in this country.

July 6, 2023

A tug of war, right?

Clearly there’s a struggle in the health care industry, with so many combatants and such high stakes. Market forces running the insurance companies, providers swamped in paperwork and burning out, patients hurt by delays or being denied services outright, hospitals struggling or or even closing, top staff seduced by high salaries, drug prices off the charts, unions and employers buying into health plans that will save them money, and racial and social injustices playing a part in all of it. 

This post continues where I left off a couple of days ago, on just one aspect of the problem: prior authorizations. How do the players in this massive tug of war over priorities deliver and receive excellent medical services at a cost people can afford in work environments that don’t destroy people's souls. 

Myndshft's definition of the practice is pretty good:
a utilization management practice used by health insurance companies that requires certain procedures, tests and medications prescribed by healthcare clinicians to first be evaluated to assess the medical necessity and cost-of-care ramifications before they are authorized.
But not all of Medicare requires them.

Original Medicare Parts A and B hardly at all.  It’s assumed that providers ask Medicare to pay for what is medically necessary, and in fact, the 1965 SS act that created Medicare, didn’t authorize any form of these at all (according to the CMA).  It’s only subsequent legislation that allowed prior auths for some services and equipment. Saying this, Medicare started requiring a “pre-claim review” process for nursing homes in some states, ostensibly to combat fraud, though one report says 90% of the errors were not from fraud but from not enough documentation.

Medicare Part D is a whole other story, as the plans are not governmental, but offered competitively by non- and for-profit companies. They decide for themselves which drugs on their formularies will require prior auths and which won’t. More likely it's the Pharmacy Benefit Managers making decisions these days, not the companies themselves.

Medicare Part C – the Advantage plans (MAPs) – are also run by non- and for-profit companies, which in their capacity as middlemen between patient and government, have rightfully earned the contempt many people have for them. Their delays and denials of service have become scandalous, their procedures and paperwork burdensome to providers.
IMPORTANTLY, there’s not much information about how prior auths are used, how often it's denied, and how reviews affect patient care and cost (KFF, May 2022).
So we don't really know what’s going to happen with the new Aetna plan. But there’s enough literature out there from CMS, the AMA, and a slew of advocacy organizations to highlight what's gone wrong and where changes have to be made.

What's gone wrong

The flowchart in Myndshft's prior authorization guide (paraphrased below) is a good place to get some understanding of the process. They're talking about a prior auth for a lab test here:

All the manual procedures in this process, the rule changing, the individual requirements of the various plans, the monitoring from start to finish, and required notifications are simply overwhelming. The AMA claims that doctors in private plans, Medicare Advantage or not, spend 16 hours a week on prior authorizations.         

Apart from the absurd magnitude of these middleman procedures, other things have gone wrong.  According to a Dept of Health and Human Services study reported in April 2022:
  • Prior auths are sometimes delayed or denied in spite of meeting Medicare coverage rules (13%) or meeting both coverage and billing rules (18%). Some plans deny because of stricter criteria than Medicare itself uses, or ask for more documentation than Medicare.
  • Most denials in their sample were caused by human errors in manual processing and system errors in the software (e.g., incorrect programing).
  • Some denials were reversed after a patient filed an appeal –  I read somewhere else that only 11% of patients go to the trouble – while others were reversed when the plan itself found it had made an error.

But can anything be done?

While Medicare for All lumbers its way through Congress, people are calling for change in the systems we have now. In May 2022, KFF advocated regulating everything having to do with prior authorizations and making them more transparent as well. Some progress, they say, has been made in at least the following areas:
  • CLINICAL COVERAGE:  As a case in point, California now requires companies to use criteria “consistent with generally accepted standards of care and ... developed by a nonprofit association for the relevant clinical specialty.” It’s unfortunate, thought, that KFF says state laws like this wouldn't apply to employer-sponsored plans, nor would they, I assume, for retiree plans.
  • TRANSPARENCY is apparently gaining momentum. There’s a House bill requiring Advantage plans to report which treatments need prior auths, and to give %s of approvals, denials, and appeals.  This kind of reporting had already been written into the ACA, but alas and alack, according to KFF, it's been largely un-implemented. 
  • SETTING STANDARDS for prior auths. For example, the ACA had already banned them in emergency care. A new Michigan law now standardizes methods and demands transparency reporting. What interests me is the new “gold card” laws, whereby health plans have to waive prior auths requested by doctors with a track record of approval. Believe it or not, the first one seems to have been enacted in Texas, of all places (discussed here). 
  • ADMINISTRATIVE REFORMS.  A bill that passed the House last fall – H.R. 3173 “Improving Seniors Timely Access to Care Act” would amend Title XVIII of the SS Act (which created Medicare in 1965) “to establish requirements with respect to the use of” prior auths in Advantage plans, including electronic submission, attachments, real-time decisions, declaring which ones would be routinely approved, data collection, transparency, etc.  Impressive: it has 326 co-sponsors, but too early for champagne.  It’s been sitting in not one but two committees for a couple of years ... 

I'm sure I wont be seeing Medicare for All in my lifetime, but I like that doctors associations  and legislators are trying to fix some of the scandalous parts of Advantage plans as we know them, even if the shareholders and a lot of bad actors are contaminating the battleground. 

July 5, 2023

Pausing on Aetna to talk about PNHP

As I mentioned in my response to some comments, I write these health care posts to clarify some of the terminology and issues that have been tossed around over the past two years – energetically and purposefully, but not entirely accurately.

Even though NYC retirees only have a few more days to decide whether they want to opt out of the new plan immediately (it will start Sept 1 if the lawsuit against it fails), you’ll be able to move in or out of it again in November, and each year thereafter. I know some people who are waiting to see what will happen in the rollout, then jump in if major problems haven’t been reported once it’s up and running. 

One “major problem” I’m half expecting is that some doctors will not immediately accept the plan because they’ve never heard of it before. I’m also keeping my ears open for the results of prior authorizations, about which I don’t expect to hear much because Aetna must know it has to be on its best behavior with regard to these and won’t deny (m)any of them in the first half year. Time will of course tell.

But as I also mentioned in other posts, I strongly believe in changing the country’s tax structure to get universal single-payer, and this is where activism is key. Letters, contacting government officials, taking to the streets, sporting pro-Medicare-for-All messaging on self and car, and anything else you can think of will help raise awareness, and discontent.

For the armchair activists in the crowd, Physicians for a National Healthcare Program (PNHP) just sent around a brief survey, prefaced by this letter from the president:
I know what I think of Medicare Advantage (MA), the large and growing program that invites insurance corporations to manage benefits for what is now a majority of people on Medicare. Of course, these corporations use money that should be going to patient care to pad their own bottom lines. Wall Street sees this program as a financial windfall, and they’re totally right.

But policy aside . . . I’d deeply appreciate it if you took a few minutes to share your perspective . . . [and] I also hope you’ll share the survey with your friends, family members, and neighbors, so we can develop a truly broad-based understanding of the program.

Digital version here.

Print version here.
PHNP’s mission statement involves advocating for universal, comprehensive single-payer national health insurance, and joining with other groups to fight racism and advance social justice.

You don’t need to become a member to see their research materials or watch their video analyses of our profit-driven American health insurance structure, a couple of which live at these links:
Medicare Advantage: What single-payer advocates need to know

Upcoding, Medicare Advantage, and DCEs

Dr. Ed Weisbart on Direct Contracting Entities

Try 'em out. The techie ones really get into the weeds.


June 30, 2023

Prior authorizations, there's the rub

I have to respond to a couple of comments made after my last post. For starters:
“People want to be in traditional medicare vs this version.”
So many people still think that Senior Care – the GHI/CBP plan that many retirees have and are trying to hold onto – is “traditional Medicare.” It’s not.

Traditional Medicare (Parts A and B) is run by the federal CMS with money from two trust funds – replenished by payroll taxes and Congressionally-authorized monies – and premiums ( As everyone knows, Medicare doesn’t cover all medical costs, far from it. There remain deductibles, copays and coinsurances, which are paid by the seniors themselves, or by their employers, a private insurance company, or the government. Even when people do buy a supplemental plan, they mostly still have to pay some things out of pocket.

The OLR has been offering retirees a choice of such plans, the most popular of which, I guess, has been Senior Care GHI. In a lot of ways it acts like a private market plan (a Medigap), but the city has negotiated it to include a general medical deductible, a fee-structure for hospital stays, and copays – none of which exist in market Medigaps.
What the commenter is really saying is these retirees want to keep the supplemental Senior Care plan and not be shoved into an Advantage plan.

The next part of the comment is balderdash:
“In essence you are repeating what Mulgrew keeps claiming - aw shucks it’s still medicare and I wish we could just call it that instead of that badly misnamed Medicare Adv — Mulgrew would call it wonderful medicare.”
Even if Mulgrew did say what’s being claimed here, it’s not worth all that much. He’s shown no deep comprehension of the way Medicare works or he’d have been explaining it better and cutting out all the PR. No one believed him when he said “We will continue to monitor its implementation” (The Gothamist): there are doctors who have still not heard about the new plan yet, and others are saying “Absolutely not, we’re not taking any Advantge plans.”

But where the commenter says:
“I think you need to qualify the differences in how med and Medadv are administered.”
that’s half right.  I haven’t really spelled out in recent posts how billing works with Traditional Medicare.

In the Traditional scenario, providers submit bills to Medicare for processing. According to Kaiser, “for most payment systems ... Medicare determines a base rate for a specified unit of service, and then makes adjustments based on patients’ clinical severity, selected policies, and geographic market area differences.” The remaining costs get forwarded to the supplemental plan, and the enrollee gets billed for what’s left to be paid. Prior authorizations virtually do not exist: this is mostly a fee-for-service situation.

I did touch on how Advantage plans work on my June 19th post, but I’ll be more specific here. Per capita amounts are sent to the Advantage plan companies (I said that), who design their own packages based on Medicare rules and government regulations (that too), but can deny coverage for certain services (and that in a different way). It’s these potential denials, based on a structure of prior authorizations in Advantage plans, but not in Traditional Medicare, that terrifies some retirees. (Not all retirees: me and some of my friends are in Advantage plans and have been getting the care we need.) But I acknowledge that the scandals surrounding Advantage plans have too frequently involved denials of coverage (for the reasons on the left, from DHHS, April 2022).
Parenthetically, I’m pretty sure the newer scandals will at some point involve upcoding:
Upcoding occurs when a health care provider seeks reimbursement using a fraudulent CPT code that provides a higher reimbursement than the CPT code which corresponds to the services actually rendered to a Medicaid or Medicare patient.

An example of upcoding would be if a doctor saw a patient for a routine check-up (which has a CPT code with a reimbursement of say $60), but when billing Medicare the doctor provides the CPT code for an extended check-up, which provides a reimbursement of $100. (Kohn, Kohn and Colapinto)
and in the Part D side of Medicare (stand-alone drug plans or drug components inside of Advantage plans), watch out for Pharmacy Benefit Managers (PBMs):
Pharmacy Benefit Managers (PBMs) are third party companies that function as intermediaries between insurance providers and pharmaceutical manufacturers. PBMs create formularies, negotiate rebates (discounts paid by a drug manufacturer to a PBM) with manufacturers, process claims, create pharmacy networks, review drug utilization, and occasionally manage mail-order specialty pharmacies. In light of rising health care costs, the role of PBMs are being reviewed due to the cost of prescriptions drugs and the effects on consumers. (NAIC Center for Insurance Policy and Research)
Here’s what our new Aetna brochure on prior authorizations says you can expect from the plan, some of which is no surprise (like cosmetic and experimental services), but some are pretty scary for people who have serious conditions and are afraid of delays and outright denials:
Compare the above the list to the city’s Medicare Advantage Plus plan of 2019, which gave 32 (!) outpatient procedures needing prior authorizations. What might be considered “normal” senior outpatient services – like endoscopy – don’t seem to require prior auths in the new Aetna plan. I actually confirmed one or two of them by phone with Aetna a couple of weeks ago. The physicians will just book the procedure and that’s that.

Back to the comments:
Who ya gonna call when there’s a problem? Right now we call Medicare. After Sept 1 we call Aetna and their most probable non-unionized, lower paid and insentivized staff to help profit motive.
Energetic, but not true. When there’s a billing problem, you don’t always have to call Medicare, and even with Advantage plans, a conversation with the doctor’s office and/or the company itself might find a coding issue, which can be fixed by correction and resubmission. Other times, the doctor has to supply more information, which annoys them no end, but the purpose is not always maniacal.

I don’t know anything about “non-unionized, lower paid and insentivized staff” on the decision panels, and I’m sure the commenter doesn’t either. What I’m reading is that there are rules on who can authorize or deny: “The ultimate decision on a prior authorization request rests with a clinician — a physician or nurse — who works for the health plan to which the request was submitted. All final denials or redirects commonly are decided by a clinician at the insurance carrier.” Another report says the “prior authorization is then reviewed by clinical pharmacists, physicians, or nurses at the health insurance company. Somewhere else I read that any of these people can approve a procedure, but only physicians can deny one.

But there have been so many complaints about access to care that CMS had to act. Last April it issued a final rule that will take effect in 2024 to address these. Here are some main points relating specifically to medical prior authorizations in Advantage plans (choices and numbering mine):
The final rule clarifies clinical criteria guidelines to ensure people with MA receive access to the same medically necessary care they would receive in Traditional Medicare. Specifically, [1] CMS [requires that] MA plans must comply with national coverage determinations ... local coverage determinations ... and general coverage and benefit conditions included in Traditional Medicare regulations ... [2] when coverage criteria are not fully established, MA organizations may create internal coverage criteria based on current evidence in widely used treatment guidelines or clinical literature made publicly available to CMS, enrollees, and providers  ... [3] streamlines prior authorization requirements, including adding continuity of care requirements and reducing disruptions for beneficiaries ... [4] all MA plans [are required to] establish a Utilization Management Committee to review policies annually and ensure consistency with Traditional Medicare’s national and local coverage decisions and guidelines ... [5] approval of a prior authorization request for a course of treatment must be valid for as long as medically reasonable and necessary to avoid disruptions in care in accordance with applicable coverage criteria, the patient’s medical history, and the treating provider’s recommendation.
“The rules are designed to ensure people with MA plans get access to the same necessary care – prescriptions, medical tests, equipment, and procedures – they would receive in traditional Medicare” (

For the rest of the comments left on yesterday’s post:
By the way, the GHI emblem plans we’ve had I am told is for a non-profit agency.

I also think to talk about how the money moves and the amounts Aetna gets from medicare to cover costs and profit. And that the admins of Medicare have nothing to gain personally compared to Aetna — say the person you deal with has employee stock options. So to blandly say Medicare Advantage is just medicare without qualifying comments is misleading.
I have never ever said Medicare Advantage is “just Medicare,” because I’ve always been a single-payer kind of girl and still wear my Bernie tee-shirt to prove it. But I do have things to say about for-profit and non-profit health insurance companies, and will save those for another day.

June 27, 2023


I need to clarify something I said yesterday, that at this point we have to “jump on board or get run over” by the Medicare Advantage juggernaut.

I was not talking about abandoning activism against the health insurance industry. 

You can stand up against Advantage plans and all the other corporately designed arrangements for managing Medicare and still want to get the best coverage for yourself at the present time.

The “juggernaut” I referred to in yesterday’s post is the health care apparatus the city has been trying to push us into for the past couple of years. They developed the Empire and Aetna PPOs behind closed doors, rolling out the first one poorly, and not convincingly fixing all the bumps in this new one. (Are you sure all your doctors will even take this new plan, or will you be denied some procedures you used to get in Senior Care without a problem?)  Neither plan has been capable of earning our complete trust.

That’s because these things are negotiated plans, and the city has only negotiated the terms of the Aetna one to last for two years. What will happen to individual parts of the coverage after that is anyone’s guess. 

Protest as much as you want at the rallies, like the one of a few days ago at the introduction of legislation to stop the Aetna plan from going through. Join other campaigns for single payer, like the very active Physicians for a National Health Program and National Nurses United, or all the other groups supporting the Medicare for All bills in the House (HR1976) and Senate (S1655). Donate to Public Citizen, or to legislators like Sanders and Jayapal. Read and support the work of people like Wendell Potter, who rails against the Medicare Advantage industry, Pharmacy Benefits Managers, and the any other corporate invention that sucks millions out of public funds. 

But  while you’re taking to the streets and sending money to causes, you still have to figure out which coverage arrangement best suits you right now. I don’t see any way around this.  There’s only a couple of options, and you need to sort through them. 

If you let yourself be placed into the new Aetna PPO (presuming it gets through the lawsuit), you’ll still be in Medicare, but in addition:  
      •  You’ll get pretty decent in- and out-patient coverage for “normal” senior health conditions.
       • You’ll get reimbursed for your Part B premium and IRMAA surcharge. (Last year Part B was $2041 a year per person, and additional IRMAA amounts were calculated in tiers of income.)

If you opt out of the new plan, you’ll still have Medicare, but: 

       • You’ll have to get supplementary coverage through one of 10 different kinds of Medigaps on the open market. These pick up some or most of the remaining Part A and B costs, but don’t include drugs or extras (like an annual physical, meals after surgery, etc.). Under no circumstances should you choose an Advantage plan. That would make no sense whatsoever, as the MAPs offered by employers and unions usually have better coverage. 
      • You will not get reimbursed for Part B or IRMAA. 


If you keep the HIP VIP HMO, things will stay as they are, including the reimbursements  for Part B and IRMAA. 


Any way you go – taking one of the two Advantage plans (Aetna PPO or HIP VIP HMO) or opting out altogether – you still get:

      • Drug coverage if you purchase the drug rider (from January 1st, $103.50 a month with the Aetna plan, roughly $180 with the HIP)
      • Dentalvision and hearing aid help through the Welfare Fund. No premiums, just union membership.
      • SHIP reimbursements for quite a few health-related services, with a $100K lifetime cap. It costs $120 a year. 

That’s it, folks. The good thing is that you can change your mind every fall.  The bad thing is, there’ll still only be these same choices. 

Unless the lawsuit succeeds, of course. We’ll have to then see what they come up with next.