Nearly 200 retired Cortland County workers are suing over plans to change their retirement health insurance from a traditional Medicare plan to a privately-run Medicare Advantage plan.
Cortland County currently offers retirees secondary health insurance to supplement their regular Medicare benefits. Medicare pays for most but not all of retirees’ health coverage.
But the county wants to switch retirees to a Medicare Advantage plan, which officials say would save hundreds of thousands of dollars. Under Medicare Advantage, the federal government pays a private insurance company to handle patients’ health care.
“A slap in the face to retirees”
The retired county workers argue potentially life-saving treatment could be interrupted or ended due to the change. They’re worried their current doctors might not take this new insurance, or that they won’t be approved for treatment.
Mary Ellen Roodenburg worked for Cortland County for 15 years. Her husband, who has had three strokes, is covered under the health insurance plan that she receives from the county.
Roodenburg is worried the new plan could refuse to cover his treatment. Most Medicare Advantage plans can require “pre-authorization". That means patients must request coverage for treatment before they undergo the medical procedures.
“I can't afford for, when he's having a stroke, somebody to say you need a pre-authorization for that now or we're going to deny that, that's a pre-existing condition,” Roodenburg said.
Roodenburg said she has finally found a good team of doctors and specialists to treat her husband after he had a stroke in April. But she said his cardiologist has already told her he can’t take the new insurance.
She argues this plan is worse than what retirees were promised.
“You can't tell me it's the same or better. It's not the same, and it's not better,” Roodenburg said. “Giving me SilverSneakers is not better. If I'm dying of cancer, I don't need a gym membership.”
Dan Dineen worked for Cortland County for about 33 years. He said the retirees feel the county promised it would pay for secondary insurance, not a Medicare Advantage plan.
He said as employees, they accepted lower pay and fewer raises because they thought good retirement coverage was waiting for them.
“Employees have worked for the county for so long with the promise of traditional Medicare with a county supplemental insurance,” Dineen said. “And to get that taken away is just a slap in the face to the retirees.”
In 2022, around half of large employers across the country had switched their retirees over to Medicare Advantage plans. These plans often save employers money, but they have come under some scrutiny in recent years.
Several federal investigations have found issues of overbilling and denials of care by Medicare Advantage insurers in the past few years. A recent investigation by NPR and KFF News found advantage plans have had a destructive financial impact on small, rural hospitals.
Lawyer Ed Goehler represents the Cortland retirees. He is a retired county employee himself and would be enrolled in the new insurance. Goehler said in a rural area like Cortland, people often drive long distances to see their providers. He said retirees are worried this will make it harder for them to find treatment.
“You're going to have people having to go to Guthrie and Sayre, where the specialists are,” Goehler said. “One hundred twenty miles round trip, three hours on backroads for people who are 70, 80. They can't do it.”
Goehler sees the Medicare Advantage plans as predatory.
“From what I can see, these people that go around, pulling retirees into the plans, they like to go to small counties,” Goehler said. “They can just kind of roll over them. Nobody even knows what's going on. The people can't afford to hire a million-dollar law firm to fight it.”
Goehler also feels the county swept the decision through too quickly, with little notice to retirees. The legislature voted 10 to 6 in favor of the change in August.
“I just wish they would give us a chance”
In court filings and legislature meetings, Cortland County has argued the new insurance plan actually offers better coverage than what retirees currently have. And during a difficult year for the county’s budget, officials say the change will save hundreds of thousands of dollars. In court filings, the cost savings are estimated to be over $600,000.
Cortland County would join Tioga, Chemung and Broome counties, which have already made the switch over to Medicare Advantage plans. Those counties, as well as municipalities across the region, purchase their coverage from UnitedHealthcare through a program called the Broome County Purchasing Alliance (BCPA).
Doug Bulman, president of the Statewide Purchasing Alliance NY, created the BCPA three years ago. The BCPA helps local municipalities negotiate with insurance companies for better rates and benefits. Bulman said they have more negotiation leverage as a united group.
Bulman has testified in court filings and during legislature meetings in support of Cortland County signing on to the new plan. He said the goal of the program is to address the very issues retirees are concerned about.
“I work in this industry, my parents are covered under my program. I want them to have the best benefits they could get,” Bulman said. “And I wanted the municipalities not to go broke trying to provide them.”
Bulman said this insurance plan not only saves Cortland County money, but will also offer better coverage to retirees. He said retirees are mistaken and assume the plan is the same as typical Medicare Advantage plans.
Bulman said under this group plan, retirees will not pay more for out-of-network health care, and any medical provider who takes Medicare will also take this insurance.
As for the issue of prior authorization, Bulman said it is standard practice for most private insurance companies to determine whether procedures are medically necessary. He points out the county’s current supplemental insurance company, Excellus BlueCross BlueShield, does the same.
Bulman said he understands the retirees’ concerns. However, he argues this particular insurance plan is customized and specifically designed to avoid a lot of the issues that come with a typical Medicare Advantage plan.
“I get that they're scared, and I get that they're worried, that they're trying to protect the retirees. I appreciate all that. I am doing the same thing,” Bulman said. “I built this program to eliminate just exactly what they're talking about. And I just wish they would give us a chance.”
The number of employers who have switched their retirees over to Medicare Advantage plans has grown in recent years, most citing cost as the reason. But only a few groups of retirees across the country have launched lawsuits.
Retirees in the state of Delaware successfully paused an attempt to enroll them in a Medicare Advantage plan. The issue is ongoing in court. In August, a Manhattan Supreme Court judge sided with 250,000 New York City retirees who sued over a similar switch.
In Cortland County, Supreme Court Justice Mark Masler has placed a temporary restraining order preventing the county from going forward with the plan. But he has not made a decision yet.
Meanwhile, the Cortland County Legislature has scheduled a special meeting on Wednesday to discuss potentially rescinding the decision to switch insurance plans.