Mayor Adams and Unions Will Force Municipal Workers To Enroll in a Reduced Care Medicare Plan To Save Money

 

There is a citywide protest against Mayor Adams' support for the new Medicare Advantage Plan that will, according to him, "save the City a lot of money". Do retirees really want to hear that?

No.

The most alarming issue is the fact that the Municipal Labor Committee is siding with Adams and will try to force City Council to change the administrative law in order to force retirees to accept the new plan.

See 

The NYC Council Must Oppose Weakening Health Insurance Protections

and

New York City municipal unions promote massive cuts to health care for retirees

This is ugly, folks.

Oppose this new private Medicare Plan any way you can, contact your Representatives in Congress, do whatever you need to do to get the attention of a politician who can stop our Mayor from "saving money" while trashing the rights and healthcare of retirees. Please save free healthcare and choice!

Take a look at the Municipal Labor Council, and try to vote out anyone who votes for this new plan.

Thank you!

Betsy Combier, Editor

betsy.combier@gmail.com

Editor, ADVOCATZ.com

Editor, ADVOCATZ Blog

Editor, NYC Rubber Room Reporter
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Adams and Unions Strike Deal on Shift to Cost-Cutting Medicare Plan

The CITY, Sam Mellins, New York Focus, Sept. 9, 2022

The mayor and major city unions plan to press the City Council to clear a path for a privatized Medicare plan for retired city workers.

At a meeting Thursday morning, the administration of Mayor Eric Adams and major unions representing municipal employees agreed on a proposal to clear the way for their long-held goal of switching retired city workers to cost-saving private Medicare Advantage plans.

The insurance shift, first reported by New York Focus more than a year ago, would likely save the city hundreds of millions of dollars a year and help pay for current workers’ benefits — but many retirees fear that it could decrease their access to health care.

At the meeting, union leaders agreed to a proposal from the administration to make a joint request to the City Council, asking it to amend city law to allow the city to charge retirees for their current health care plans. That would remove a legal roadblock that has held the switch up in court and led the insurer that had won the contract to administer the plan to back out in July.

“It wasn’t all wildly enthusiastic votes, and people were expressing qualms. But the difficulty is we’re not quite sure what else to do, because there is a financial problem here,” said Robert Croghan, chair of the executive board of the Organization of Staff Analysts, a union representing city office workers across numerous agencies. Croghan estimated that 85% of the dozens of union representatives present voted in favor of the proposal.

Oren Barzilay, president of Local 2507, a union representing fire department employees, told New York Focus that he voted against the proposal. “The law gives us protection in terms of having our current health benefits,” he said. “Why would you open up that Pandora’s box not knowing what could happen?”

The city projects that the shift to Medicare Advantage will save $600 million annually, which would go to a fund jointly controlled by the city and unions that is used to pay for current city employees’ health insurance and other benefits. Without that additional cash, the benefits that the fund provides could be at risk.

The city and union leaders have claimed that retired city workers would receive the same quality of care under a Medicare Advantage plan as they currently receive under Senior Care, the free insurance plan that the city provides to most retirees. But many retirees have raised concerns that a Medicare Advantage plan would provide less coverage and carry greater out-of-pocket costs than Senior Care.

The city had planned to incentivize retirees to switch to Medicare Advantage by requiring them to pay $191 a month to maintain their coverage under Senior Care. In a March decision on a lawsuit filed by retirees to stop the switch, state Supreme Court Judge Lyle Frank ruled the city can’t force retirees to pay for their current care.

Frank’s ruling threatened the viability of the switch as a cost-cutting device. By April, over 65,000 retirees had opted out of the Medicare Advantage plan — more than one out of every five retired employees.

The proposed legislation, endorsed by the mayor’s Office of Labor Relations and the unions’ Municipal Labor Committee, would change the text of the law that Frank based his ruling on to allow the city to force retirees to pay to maintain their current coverage.

The legislation would also open the door to changes to the health insurance of current city employees. Currently, the city is required to pay for its employees’ health insurance costs up to a certain benchmark: the cost of the HIP HMO Preferred plan, which the city has offered employees for over 60 years. The proposed legislation would allow the city to designate a new benchmark plan. Selecting a cheaper plan than HIP HMO could allow the city to spend less on insurance and potentially leave active employees with narrower coverage.

The proposal is detailed in a letter from Labor Relations Commissioner Renee Campion to Harry Nespoli, chair of the Municipal Labor Committee, a coalition of city workers’ unions. The legislative change “would help ensure the parties have the necessary flexibility to obtain quality and affordable health insurance coverage for covered individuals,” the letter states. The letter also says that at least one plan for retirees and active employees would remain premium-free, as Senior Care and HIP HMO Preferred currently are.

Frank’s ruling allowed the city to eliminate Senior Care entirely, but the city hasn’t given any indication that it is considering that step.

The Adams administration is appealing Frank’s ruling. But if the City Council adopts the Office of Labor Relation’s proposed legal change, then getting the ruling overturned might be unnecessary.

“It’s an end run around the court decision, in a sense,” Croghan said.

The unresolved Medicare Advantage situation is likely to be a significant sticking point in upcoming contract negotiations between the unions and the city, City & State reported on Wednesday. If the unions think that their health care costs are likely to go up, they may ask for larger raises, which would cost billions of dollars. That could be an ask that the city is reluctant to grant, especially since current projections show it is already likely to face multi-billion-dollar budget gaps in upcoming years.

Croghan predicted that the City Council will approve the proposed change.

“It’s something that Adams wants, and now the Municipal Labor Committee says they want it too. Why would the City Council not go along with it?” he said.

Barzilay said that public opposition to the plan, which has been vocal in the past, could present an obstacle.

“There’ll be people testifying for it, and people testifying against it. It’s just a matter of who’s more persuasive to the City Council,” he said.

American Federation of State, County and Municipal Employees (AFSCME) Takes Over Local 1549 of DC 37 After Audit Shows Financial Mismanagement

 

DC37 public sector union leader Henry Garrido speaks at the Citi Field vaccination site, March 27, 2021.

Michael Appleton/Mayoral Photography Office

City Workers’ Union Taken Over by National Parent After Audit Finds Improprieties

The CITY, Reuven Blau and Claudia Irizarry Aponte, September 21, 2022

Local 1549 of District Council 37, whose members include low-paid secretaries and clerical aides, had its management removed and is now being run by AFSCME in Washington D.C.

The union local representing New York City’s public sector clerical workers was placed under administratorship by its international union, the American Federation of State, County and Municipal Employees (AFSCME), over allegations of financial mismanagement, THE CITY has learned.

Local 1549 of District Council 37 announced the local’s day-to-day operations are under the control of the international union “effective immediately” following an audit that revealed “serious deficiencies and numerous violations of AFSCME’s Financial Standards Code,” according to a letter addressed to rank-and-file members dated Sept. 19.

A draft version of the audit obtained by THE CITY revealed questionable payments to a former employee of the local working as a consultant, gift cards given to union staffers not properly tracked, and $45,500 in car service expenses by ousted Local 1549 President Eddie Rodriguez that never should have been covered by the union.

Also flagged: $257,000 in American Express charges, where “in many instances, the union business purpose of the charges was not explained.” Auditors stated: “Local 1549’s practices here are very concerning.”

The audit spanned the period of time from January 2020 to April 2022. Henry Garrido, executive director of DC 37, said that union members submitted the complaint that triggered the audit directly to AFSCME.

The administratorship is the latest financial scandal at Local 1549, whose members are among the city’s lowest-paid workers. In 2001, Al Diop, the former president of the now 12,000-member local, was sentenced to up to four years in prison for rigging a union election and ripping off union funds.

DC 37, the city’s largest public-sector union, is gearing up for negotiations with the Adams administration for a new contract covering approximately 100,000 workers. Bargaining is set to begin in the coming months — even as the city faces massive budget deficits. The unions are meanwhile trying to make a rocky transition to a new privatized Medicare plan with the aim of saving money.

“We’re committed to getting the best contract possible to our members, and we’re concentrating on dealing with a difficult issue with health care,” Garrido said in an interview with THE CITY on Wednesday. “So, to me, while we can maintain a zero tolerance policy for any kind of misbehavior or anything like that, our focus is to provide services to our members. This is not going to be a distraction or anything for what we need to do to get and deliver for our members in the best way possible.”
‘Emergency Situation’

AFSCME spokesperson Tracey Conaty confirmed the contents of the letter, adding that the matter is pending an internal judicial panel hearing by the international union next month. She declined to comment further.

“In my opinion an emergency situation exists in Clerical Administrative Employees, New York, New York Local 1549, AFSCME, AFL-CIO, in that dissipation or loss of the funds or assets of the local is threatened and the local is acting in violation of the International Constitution,” AFSCME president Lee Saunders wrote in a Sep. 19 suspension notice to the union’s officers cited in the communique to rank-and-file members. “Therefore, in accordance with Article IX, Section 37 of the International Constitution, I am placing AFSCME Local 1549 under administratorship, pending notice and hearing, effective immediately.”

Rodriguez and the rest of Local 1549’s top leadership were immediately removed. The local — with 12 full time employees — is now being run by James Howell, AFCME’s eastern regional director, who earned $271,093 in 2019.

Rodriguez declined to comment. “I don’t want to talk about it,” he told THE CITY before hanging up.

His supporters contend the audit’s findings described financial practices that go on at many of DC 37’s other 56 locals. They also contend the AFSCME takeover is politically motivated.

In January 2019, Rodriguez, who had served as DC 37’s president since the early 2000s, was defeated by Shaun D. Francois I, president of Local 372. That’s the largest local in DC 37, representing more than 23,000 school staff including school crossing guards and school lunch workers.

School crossing guards earn $15.45 an hour and an average of $19,500 annually, according to Intuit, which calculated the data based on 133 TurboTax users. School lunch helpers earn $33,944 a year, according to ZipRecruiter.

Garrido runs the overall union operation with an executive board, while the DC 37 president has a lesser role — presiding over meetings of the union delegates, presidents, and executive board.

“I think it’s political because the problems that they noted go on in most of the locals,” said Arthur Schwartz, an attorney who has represented many members who have opposed DC 37’s leaders.

“I have no idea what he’s talking about,” Garrido told THE CITY in response.

“This behavior does not happen in the other locals,” he added. “That is patently false.”

A group of people who challenged Francois’ reelection as head of Local 372 last year alleged that he received $296,015 in improper overtime payments in addition to his salary, according to The Chief-Leader. Overtime has long been prohibited for local presidents at DC 37.

Francois did not immediately respond to a request for comment.

Schwartz, who is representing Francois’ opposition, noted the local’s treasury has gone down on average by about a million dollars a year since 2015. Francois has asked AFSCME to audit the local’s finances.
Unverified Pay

As for the Local 1549 audit, the 10-page assessment was based on a “review of policies, minutes, financial statements, and a sample testing of the Local’s accounting records.”

The review first took issue with pay given to Ralph Palladino, the second vice president of the local, who retired in December 2021. All told, he was given $170,470 to cover 71 unused vacation days, 43 compensatory days and 14.3 years of severance pay. Other DC 37 locals have similar packages including so-called severance pay for when officers retire, according to labor insiders.

The audit questioned Palladino’s stockpiled comp time and noted there was no proof the union’s executive board approved the overall “cash outs” for him.

“We have been presented no evidence that the full-time officers punch in and out of work at the time clock or have a set number of hours per day or week that they work,” the audit said. “We cannot verify that the compensatory time accrued and paid was properly documented and paid or even the basis for the claim that compensatory time should be granted for work performed.”

The local’s leaders should also create a “clearly defined policy” for retirement payments, the audit added. “The Local should consider whether continuing these large separation payments upon retirement of its officers is in the best interest of the membership,” the financial review said.

Palladino, who for years served as the one of the local’s loudest cheerleaders and activists, said he was not familiar with the audit and declined to comment.

The audit also revealed that the local used Executive Charge Inc., a black car service, to provide rides for officers and staffers.

All told, the union spent $51,301 with $45,500 going toward Rodriguez’s car service usage from January 2020 through April 2022, according to the audit. Rodriguez was driven around 109 times to commute from home to the office or vice versa, the review said.

“This averages to be $288 for each trip for commuting,” the audit said. “Commuting is a personal expenditure and should not be paid for or reimbursed by the Local unless it is reported as…taxable wages.”

Rodriguez did not report the usage as taxable compensation and it was not included on his annual W-2’s, the review noted. “This is a serious deficiency,” the audit said, noting that there were “multiple” times where the union was hit with additional car service “wait time” for Rodriguez ranging from $42 to $168.

The audit also found that the union was using Dan Persons, a former employee of the union, as a consultant. He was paid $2,000 a month for a yearly total of $24,000. As part of that deal, he provided monthly invoices detailing the work performed. “But our review of invoices indicates that he copies the same work performed on several monthly invoices,” the audit said.

Renee Gainer, a former division director at DC 37, was also paid $2,000 a month as a consultant for the local, according to the financial review. There was no formal consulting agreement and her invoices also indicate “that she also copies the same work performed on several monthly invoices,” the audit said.

One labor expert said the local takeover by the international union was significant.

“It is a serious thing,” said Joshua Freeman, a labor historian and author of the book, “Working Class New York.”

“It’s an indication that the local can’t fix its own problems, and that you really have to bring in new leadership and an outside team to try to get things back on track, financially, democratically, whatever it might be,” he added. “So it’s kind of a big deal.”

Saunders, AFSCME’s current international president, was the administrator of the 2001 DC 37 trusteeship. He was put in charge after the vote rigging scandal rocked the union during the administration of former Mayor Rudolph Giuliani.