New York City can implement an Aetna Medicare Advantage plan for its retirees, the state’s highest court ruled June 18.
The city has pushed to switch its health benefits for retired city employees to a Medicare Advantage plan since 2021. A group of retired employees sued to block the plan, arguing that the city had promised to provide supplemental Medicare benefits, and that their healthcare benefits would be diminished under an MA plan.
The New York Court of Appeals ruled against the retirees, reversing lower courts’ decisions. The judges ruled the city was not obligated to offer Medigap plans to its retirees. The court also ruled the retirees did not prove their care would be harmed under an MA plan.
The city selected Aetna to administer the $15 billion contract to more than 200,000 enrollees, which the insurer said was one of the largest contracts in company history.
“We are pleased with the Court’s decision and their focus on the legal aspects of this case. We look forward to working with the City of New York to implement this plan,” an Aetna spokesperson said in a statement shared with Becker’s. “We also look forward to serving the city’s retirees who dedicated their careers in service to their fellow citizens of New York City.
It is not clear how quickly the plan could be implemented, the New York Daily News reported June 18. New York City Mayor Eric Adams faces reelection in September, and a new administration could choose to move away from the MA plan, the newspaper reported.
At the Becker's 5th Annual Fall Payer Issues Roundtable, taking place November 2–3 in Chicago, payer executives and healthcare leaders will come together to discuss value-based care, regulatory changes, cost management strategies and innovations shaping the future of payer-provider collaboration. Apply for complimentary registration now.