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Retired NYC employees sue to block new ‘inferior’ Medicare coverage
- Thread starter mikeindabronx
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Widows of NYC first responders who died in line of duty must pay for health insurance after city changes policy:
EXCLUSIVEBy CHRIS SOMMERFELDTNEW YORK DAILY NEWSJAN 02, 2022 AT 10:00 PM
Elderly spouses of cops, firefighters and other New York City workers who died in the line of duty are being told they will have to start paying for health insurance if they opt out of a new Medicare plan the city is forcing on them and thousands of municipal retirees, the Daily News has learned.
After the 9/11 attacks, state legislators passed a law allowing line-of-duty spouses — widows or widowers of uniformed city employees who died on the job — to remain on their late loved ones’ health insurance for life, free of charge.
Now, survivors age 65 and older will be responsible for a $191 monthly premium starting in April if they decide to stay on their current coverage instead of being automatically enrolled in the new Medicare plan, emails from ex-Mayor de Blasio’s administration reveal.
“Unfortunately not,” a representative of de Blasio’s Office of Labor Relations wrote in a Dec. 23 email to a widow who asked if she would still have free insurance if she kept her current plan. “When the premium changes in April, the new cost will be $191 for all members with no RX coverage.”
The labor relations worker noted that the new so-called Medicare Advantage plan will still be free and urged the woman to enroll.
Survivors age 65-year-old and older will be responsible for a $191 monthly premium starting in April if they decide to stay on their current coverage, emails revealed. (Shutterstock/Shutterstock)
Therese Fay, an 89-year-old retired nurse who has relied on the free insurance since her FDNY firefighter husband died, said she feels betrayed because she doesn’t want to give up her current plan.
“There was a promise they were supposed to keep that we wouldn’t have to pay no matter what,” said Fay, who has lung cancer and undergoes regular treatment. “With my old plan, I didn’t have to worry about finances or what’s covered. With this new plan, I don’t know. They haven’t told me.
“I’m shocked,” she continued. “I never expected the city to do this. They were always very good to us.”
Last fall, de Blasio’s administration started the process of switching the city’s 250,000 Medicare-aged municipal retirees and their dependents over to a Medicare Advantage plan, saying the shift would not impact their benefits but save taxpayers $500 million a year thanks to a larger influx of federal funds.
But the NYC Organization of Public Service Retirees — comprising retired cops, firefighters and other city workers — sued over the move, alleging the new Medicare plan could water down overall coverage by, among other things, imposing complicated pre-authorization processes for certain medical procures.
The group also blasted the city for sending out incorrect enrollment information to retirees, prompting a Manhattan court to push back the opt-out deadline until April and order the city to clarify its “irrational” rollout of the plan. De Blasio’s administration initially wanted to set the opt-out deadline for November.
With de Blasio now out of office, Mayor Eric Adams, a retired NYPD captain, could rescind the new Medicare plan and let retired city workers and line of duty spouses keep their old benefits without a financial penalty.
Adams has not said how he plans to deal with the thorny issue, and his spokesman did not return a request for comment.
After his November win, Adams said he would look at the new plan “and make sure it’s not a bait and switch” for retirees.
De Blasio’s team insisted until the bitter end of his administration that the Medicare Advantage plan is the best option for everyone involved — including surviving spouses.
“The NYC Medicare Advantage plan is free and includes even more benefits for retirees than the previous plan,” Danielle Filson, de Blasio’s press secretary, said last week. “This plan follows the law and will ensure line-of-duty families are taken care of.”
Former Mayor Bill de Blasio
Sheila, an 80-year-old widow who asked to be identified by only her first name, said she has seen nothing to corroborate Filson’s claim and doesn’t trust that the new plan will be better for her because she’s received contradictory information. Sheila said she was initially told that only seven medical procedures would require pre-authorization before hearing that the actual figure is 87.
“I’m very happy with my health coverage. If Medicare Advantage will be close to what we have then maybe it would be acceptable, but the problem is that we don’t know because we haven’t been given the right information,” said Sheila, whose husband, an FDNY firefighter, died in the line of duty in 1992.
“The unknown is the big elephant in the room.”
Marianne Pizzitola, a retired FDNY emergency medical technician and president of the NYC Organization of Public Service Retirees, said she asked to meet with Adams for weeks to urge him to roll back de Blasio’s Medicare Advantage push.
So far, Pizzitola said she hasn’t heard back from the new mayor’s team.
“Adams has the power to change this,” she said. “He needs to know all sides of this before he makes a decision.”
EXCLUSIVEBy CHRIS SOMMERFELDTNEW YORK DAILY NEWSJAN 02, 2022 AT 10:00 PM
Elderly spouses of cops, firefighters and other New York City workers who died in the line of duty are being told they will have to start paying for health insurance if they opt out of a new Medicare plan the city is forcing on them and thousands of municipal retirees, the Daily News has learned.
After the 9/11 attacks, state legislators passed a law allowing line-of-duty spouses — widows or widowers of uniformed city employees who died on the job — to remain on their late loved ones’ health insurance for life, free of charge.
Now, survivors age 65 and older will be responsible for a $191 monthly premium starting in April if they decide to stay on their current coverage instead of being automatically enrolled in the new Medicare plan, emails from ex-Mayor de Blasio’s administration reveal.
“Unfortunately not,” a representative of de Blasio’s Office of Labor Relations wrote in a Dec. 23 email to a widow who asked if she would still have free insurance if she kept her current plan. “When the premium changes in April, the new cost will be $191 for all members with no RX coverage.”
The labor relations worker noted that the new so-called Medicare Advantage plan will still be free and urged the woman to enroll.
Survivors age 65-year-old and older will be responsible for a $191 monthly premium starting in April if they decide to stay on their current coverage, emails revealed. (Shutterstock/Shutterstock)
Therese Fay, an 89-year-old retired nurse who has relied on the free insurance since her FDNY firefighter husband died, said she feels betrayed because she doesn’t want to give up her current plan.
“There was a promise they were supposed to keep that we wouldn’t have to pay no matter what,” said Fay, who has lung cancer and undergoes regular treatment. “With my old plan, I didn’t have to worry about finances or what’s covered. With this new plan, I don’t know. They haven’t told me.
“I’m shocked,” she continued. “I never expected the city to do this. They were always very good to us.”
Last fall, de Blasio’s administration started the process of switching the city’s 250,000 Medicare-aged municipal retirees and their dependents over to a Medicare Advantage plan, saying the shift would not impact their benefits but save taxpayers $500 million a year thanks to a larger influx of federal funds.
But the NYC Organization of Public Service Retirees — comprising retired cops, firefighters and other city workers — sued over the move, alleging the new Medicare plan could water down overall coverage by, among other things, imposing complicated pre-authorization processes for certain medical procures.
The group also blasted the city for sending out incorrect enrollment information to retirees, prompting a Manhattan court to push back the opt-out deadline until April and order the city to clarify its “irrational” rollout of the plan. De Blasio’s administration initially wanted to set the opt-out deadline for November.
With de Blasio now out of office, Mayor Eric Adams, a retired NYPD captain, could rescind the new Medicare plan and let retired city workers and line of duty spouses keep their old benefits without a financial penalty.
Adams has not said how he plans to deal with the thorny issue, and his spokesman did not return a request for comment.
After his November win, Adams said he would look at the new plan “and make sure it’s not a bait and switch” for retirees.
De Blasio’s team insisted until the bitter end of his administration that the Medicare Advantage plan is the best option for everyone involved — including surviving spouses.
“The NYC Medicare Advantage plan is free and includes even more benefits for retirees than the previous plan,” Danielle Filson, de Blasio’s press secretary, said last week. “This plan follows the law and will ensure line-of-duty families are taken care of.”
Former Mayor Bill de Blasio
Sheila, an 80-year-old widow who asked to be identified by only her first name, said she has seen nothing to corroborate Filson’s claim and doesn’t trust that the new plan will be better for her because she’s received contradictory information. Sheila said she was initially told that only seven medical procedures would require pre-authorization before hearing that the actual figure is 87.
“I’m very happy with my health coverage. If Medicare Advantage will be close to what we have then maybe it would be acceptable, but the problem is that we don’t know because we haven’t been given the right information,” said Sheila, whose husband, an FDNY firefighter, died in the line of duty in 1992.
“The unknown is the big elephant in the room.”
Marianne Pizzitola, a retired FDNY emergency medical technician and president of the NYC Organization of Public Service Retirees, said she asked to meet with Adams for weeks to urge him to roll back de Blasio’s Medicare Advantage push.
So far, Pizzitola said she hasn’t heard back from the new mayor’s team.
“Adams has the power to change this,” she said. “He needs to know all sides of this before he makes a decision.”
Bulldog
Bulldog
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- Apr 16, 2008
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While I certainly feel sorry for her in some respects shelter have to face reality like the rest of us do. Medical coverage is extremely expensive for everyone and our costs keep rising every year. It still sounds like they are getting a great deal compared to most of us.
I believe if a benefit is promised to an individual that was negotiated and agreed upon by both sides, then this should not be taken away
If in the future, any of the involved parties feel a change is needed, then that should take place under a change in contract agreements, involving all parties.
People make their choices in life.
Some want job security
Some want good benefits
Some want Big, Quick Dollars
Being a firefighter, police officer, emt, etc takes giving up time with your families on nights and certainly during the holidays and on weekends.
Sometimes these types of jobs bring on serious job related injuries or even death
If this benefit has been fairly negotiated, then I feel the city has made a written commitment and needs to honor that commitment
If in the future, any of the involved parties feel a change is needed, then that should take place under a change in contract agreements, involving all parties.
People make their choices in life.
Some want job security
Some want good benefits
Some want Big, Quick Dollars
Being a firefighter, police officer, emt, etc takes giving up time with your families on nights and certainly during the holidays and on weekends.
Sometimes these types of jobs bring on serious job related injuries or even death
If this benefit has been fairly negotiated, then I feel the city has made a written commitment and needs to honor that commitment
Really Bulldog? These people all lost a loved one in the Line of Duty and then were promised by NYC that the medical plan they had would be free for the rest of their lives. Now NYC wants to change the plan they currently have or if they want to keep their current plan they will be paying almost $2300 a year for that privilege - that doesn't sound like free to me? So much for a great deal (your words), as if any deal after losing a loved one is a great deal!
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I disagree.
Nothing is free. Past firefighter benefits were earned, and paid for, with dangerous duty and sometimes with Line-of-Duty Death, serious injury or a chronic medical condition. Do not try to compare your medical benefits and costs with those who perform duties very much unlike yours and others.
It also does not sound like they are getting a "great deal". It is unfair to change a program that was promised or agreed to. It is traumatic to force those who have retired, many whom are elderly, to change their medical coverage, their doctors and their pharmacy plans so a current political administration can save money to spend somewhere else.
Expensive medical costs which keep rising should be addressed by competent political leadership, not by elderly widows and retired firefighters and their families who deserve to be respected and taken care of. That should be honestly facing reality.
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The City offers unlimited housing and medical benefits to anyone who shows up in NYC from anywhere in the world. Coney Island/Brighton Beach is loaded with elderly from the former USSR, most arriving here post 1991, all on Medicare, etc Travel up to the Butler Houses NYCHA in the Bronx, there are recent African immigrants residing there in great numbers, also on multiple forms of public assistance. Fill in a neighborhood in between and there is plenty of "assistance" offered to people who are natives of other countries.
It's a kick in the face to those who served and to their dependents! Getting chiseled down benefits over time, while the same scum politician pats himself on the back for supporting the "XY" community.
It's a kick in the face to those who served and to their dependents! Getting chiseled down benefits over time, while the same scum politician pats himself on the back for supporting the "XY" community.
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3-3-22 the Judge ruled in our favor..... you have the option to keep your provided Health Plan if you OPT OUT ...... https://mailchi.mp/nycretirees/we-won?e=bb64da550d ........
nycretirees.org/opt-out
I just called the OPT OUT number in "Method One"....a woman answered right away & took the info & provided a reference number & said they will email & then USPS mail a hard copy receipt...just an FYI ..when calling have your Medicare number & Social Sec number handy as well as the same info for your wife......Thank you to all that fought for this as well as those who provided guidance along the way & please continue to support the NYC Retirees Organization with a few of the Bucks you saved.
nycretirees.org/opt-out
I just called the OPT OUT number in "Method One"....a woman answered right away & took the info & provided a reference number & said they will email & then USPS mail a hard copy receipt...just an FYI ..when calling have your Medicare number & Social Sec number handy as well as the same info for your wife......Thank you to all that fought for this as well as those who provided guidance along the way & please continue to support the NYC Retirees Organization with a few of the Bucks you saved.
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I did the same and I will be truthfully honest, I felt such a wave of relief to get this "obstacle" off my mind. It was something that would have been a great financial strain if it had come to pass. I wish to thank all the individuals and groups that fought for this win, the judge and above all, God. It's ludicrous how the City "screws" you while you are working for them and continues to do so when you retire.
Retired NYC Workers Celebrate Medicare Coverage Switch Court Win
Court rules retirees can keep current insurance free of charge, as alternative to a planned cost-cutting transfer to Medicare Advantage.
www.thecity.nyc
Retired NYC Workers Celebrate Medicare Coverage Switch Court Win
Court rules retirees can keep current insurance free of charge, as alternative to a planned cost-cutting transfer to Medicare Advantage.- By Sam Mellins, New York Focus
- on March 3, 2022 5:26 pm
- Additional reporting by Reuven Blau
A years-long fight over a planned cost-cutting change to retired city employees’ health coverage reached a critical juncture Thursday with a judge’s decision that allows retirees to choose to keep their current plan.
The ruling from Judge Lyle Frank in Manhattan state Supreme Court allows a joint city-union effort to shift retired municipal workers’ health coverage from traditional Medicare to a privatized Medicare Advantage program by April 1 to proceed. But the city must now let current and future retirees opt out of the shift and maintain their current health care free of charge.
The ruling was a partial win for the city, which under former Mayor Bill de Blasio reached agreement with municipal unions to pursue the Medicare switch and other cost savings as existing workers sought raises.
But it’s also a victory for the group of retirees who sued to stop the switch, citing fears of higher costs, smaller networks, and greater administrative obstacles to accessing health care and preferred doctors under the new plan.
The city had planned to force retirees to enter the new privately administered Retiree Health Alliance plan, or pay $191 per person per month to maintain their current coverage. Retirees currently receive their insurance package — traditional Medicare plus a supplemental program for treatments not covered by Medicare — free of charge.
Especially for retirees at the lower end of the city’s pension scale, which bottoms out around $15,000 a year, that cost threatened a significant financial burden.
Judge Frank’s order said that as long as the retirees’ current health care program, known as GHI Senior Care, continues to exist as an option, it must be offered to retirees free of charge.
Steve Cohen, the lawyer for the NYC Organization of Public Service Retirees, the group that sued to block the switch, said that Frank’s ruling was “an unequivocal win” for retirees.
“They’re happy they’re going to be protected and they’re going to have their doctors. We’re grateful to the judge for seeing through all that the city tried to put forth,” he said.
But the ruling also creates a new complication for City Hall and municipal unions, by disrupting the expected boost to funding for union member health benefits from reinvestment of the plan’s savings.
Michael Mulgrew, president of the United Federation of Teachers, urged reworking the labor deal to ensure the promised reinvestment will still be realized.
“While the NYC Medicare Advantage Plus plan is sound, the program has suffered from serious implementation problems and poor legal arguments, particularly on the part of the city. Our retirees deserve better,” said Mulgrew in a statement.
He announced the UFT is withdrawing its support for the April 1 start date “and will urge the Municipal Labor Committee to suspend its efforts to begin the program until all the implementation and legal issues are resolved.”
And Henry Garrido, executive of District Council 37, the city’s largest municipal union, said the ruling would require his labor organizations and others to renegotiate with the city. DC 37 members have been working under an expired contract since May and the union is seeking to set a new wage and benefit pattern for the entire city workforce. “But that’s probably not going to happen until we find a solution for the health contract,” he noted.
A spokesperson for City Hall said “We are reviewing the court’s decision and evaluating our options.”
The city Law Department did not immediately respond to a request for comment.
Obstacles to Care
For nearly a year since details of the new medical plan became public, retirees have voiced skepticism that it will provide benefits equal to what they currently receive, while saving taxpayers a promised $600 million annually.Nearly all Medicare Advantage plans include fewer doctors than traditional Medicare does. The city has repeatedly claimed that the Alliance’s plan will enable retirees to see any doctor that accepts Medicare, which the vast majority of doctors do. But retirees cast doubt on this claim, giving testimony at hearings and submitting affidavits in state court saying that their doctors have told them that they will not be participating in the plan, or are unaware of it.
The new plan will also make it more difficult for retirees to access many treatments.
Under Medicare Advantage, health care providers will have to get approval in advance from insurance companies before conducting dozens of procedures or treatments including some doctor’s office visits, mental health care treatments, home health care services, and tests such as x-rays and bloodwork, legal documents show.
Under their current Medicare, this kind of pre-approval is only required for a very limited number of treatments, such as transplants and physician-administered drugs. Most treatments do not require any pre-approval at all.
“We are so grateful that we will not have the $191 penalty every month, which we cannot afford, and we are so grateful that we will not be required to have prior authorizations for many, many, many common medical treatments,” said Sarah Shapiro, a retired member of the United Federation of Teachers union.
Now the leaders of the retiree backlash are preparing to make sure retirees know that they can opt to keep their current Medicare coverage for free.
“We’re trying to get the message out to retirees that they still have time to opt out, if they wish to,” Cohen said.
‘Drop This’
But the retirees’ victory may be a temporary one. Under Frank’s order, the city has the right to drop the GHI Senior Care plan and force all retirees onto the fully private Medicare Advantage program in the future.Cohen said that any moves to eliminate Senior Care would have to be the subject of negotiation between the city and the municipal unions. “Is that in the best interest of the active [employees] or retirees? Let’s see if everybody will do the right thing,” he said. The ruling is also subject to appeal.
Harry Nespoli, chair of the Municipal Labor Committee and president of the sanitation workers’ union Teamsters Local 831, told New York Focus that the Municipal Labor Committee is in discussion with lawyers for the city on whether or not to appeal the ruling.
“I’m hoping to appeal, but I’m not going to appeal something that my lawyers are telling me, ‘It doesn’t look like we have a very good case here,’” he said. “We should have an answer in a couple of days.”
Ralph Francisco, a retired lieutenant paramedic with the New York Fire Department, and a member of the board of the Organization of Public Service Retirees, said that he hopes the city will not appeal the decision.
“Please, just let it go. We’ve earned these benefits, we’ve fought for these benefits, the judge has said we’re in the right. Do the right thing Mayor, drop this,” he said.
During his mayoral campaign, Adams voiced concerns about the plan, calling it a “bait-and-switch” that would “traumatize” retirees.
“Some of the stories I’m hearing about increases in payments, you’re on a fixed income — this is devastating,” he said at a campaign event in October 2021.
But once elected, Adams began singing a different tune. On Feb. 6, he issued a statement of support for the plan. “I believe the new program will be in the best interest of retirees and the city’s taxpayers, who stand to save $600 million annually,” Adams said, noting that the plan will “continue to offer premium-free health coverage to retirees, along with new and enhanced benefits.”
As a retiree from the New York City Police Department, Adams’ own healthcare benefits will be affected by the shift.
With Adams supporting the change, retirees have looked to city Comptroller Brad Lander to block the plan. Lander voiced concernsabout the switch last month, but it is not clear he has much power to impede it.
Even if the comptroller objects to a contract, city law allows the mayor to overrule themand enact it.
The genesis of the Retiree Health Alliance plan, which will be run by a partnership between insurance giants EmblemHealth and Empire Blue Cross Blue Shield, dates to a 2014 agreement between de Blasio and the major municipal unions. In that deal, the unions promised several billion dollars of health care savings in exchange for raises for current employees.
New York Focus broke the news of the planned shift in April, and in September, the NYC Organization of Public Service Retirees filed suit seeking to block it.
In October, Judge Frank issued a temporary injunction against the plan, and in December, he delayed its implementationuntil April 1, leaving open the possibility of further delays. The plan had originally been set to go into effect on January 1.
Frank’s December order required the city to extend the period that retirees are permitted to opt out of the Medicare Advantage plan through June 30, a position that he reaffirmed in Thursday’s order.
About 47,000 retirees — nearly 20% of retired city workers — have already opted out of the plan, Fortune reported in earlier this week.
The plan’s rollout has been marred by confusion and inaccuracies. Last fall, the city mailed retirees plan enrollment guides containing false information on key aspects of the new plan. The city initially refused to mail retirees a corrected version of the guide, citing an estimated $825,000 cost and a “global paper shortage.” In his December order, Frank required the city to mail corrections to all retirees who had received inaccurate enrollment guides.
Francisco, the retired paramedic, said that Thursday’s ruling “means a lot” to him.
“I didn’t want to be told that I needed to get permission to go to a doctor, to have a referral to go get an MRI done, and be told by an insurance company, ‘well, do you really need that?’” he said.
For fire department retiree John Gilleny, the whole saga has a moral. “I’d like to say that the statement that you can’t beat City Hall is untrue,” he said.
It always annoyed the hell out of me when-ever it was said that NYC employees eg: cops and firefighters receive free health care. It never was free during my 37 years in the FDNY. Whenever we negotiated/received raises it was always broken into two parts, salary increase and benefit costs. If we received a 3 percent raise 2 percent went into salary and 1 percent into benefits.
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- 16,224
NYC SURPLUS
Considering the substantial surplus, why is Mayor Adams insisting to continue to alter the health insurance for NYC retirees?
DiNapoli: Federal Aid, Increasing Tax Revenues and Savings Boost New York City's Surplus
by Tom DiNapoli - Office of the State Comptroller -
New York City is expecting to generate a surplus of $3.7 billion in fiscal year (FY) 2022 due to federal aid, better-than-projected tax revenues, and planned savings, according to a report released today by State Comptroller Thomas P. DiNapoli on the city’s February financial plan. The surplus could reach at least $4.5 billion, if revenue and spending remain on their current tracks, according to DiNapoli’s analysis.
“Strong revenue, a rebound in property values, and the restart of the city’s Program to Eliminate the Gap (PEG) will help produce significant recurring savings in the next few years and should help buffer the city from economic and fiscal uncertainty in the near future,” DiNapoli said. “The plan also addresses $1.2 billion in recurring risks my office previously raised. Still, more can be done to prepare for unforeseen risks and to manage challenges as increased spending is spurred by inflation and other fiscal pressures. The city should also look at more ways to generate cost efficiencies and build its reserves to secure a smooth recovery and help ensure the city’s quality of life over the long-term.”
Continued improvement in the city’s economic recovery since the beginning of the fiscal year is expected to provide $1.7 billion in better-than-projected tax revenues in FY 2022, according to its February plan. The restart of the PEG, fueled by reducing vacancies for aggressive hiring targets, is projected to create $866 million in savings in the current year and more than $1.1 billion annually in subsequent years.
The city’s financial position gives it an opportunity to increase its prepayments of FY 2023 spending, enhance its rainy-day fund or retiree health benefits trust, or reduce future expenses in other ways. The city currently plans to use the entire surplus generated this fiscal year to prepay a portion of its FY 2023 debt service and help it to balance the budget in that fiscal year.
The updated financial plan balances the budget for FY 2023 as the city moves closer to economic and budgetary normalcy. Federal aid will drop from 17% to 10% of projected annual spending, returning to its 10-year pre-pandemic average.
Property tax revenues are now expected to rise in FY 2023 by $1.5 billion from the prior year, an increase of $848 million from the November plan projection, with an anticipated increase in total property valuation of more than 8%. The projected valuation is expected to top the FY 2021 peak three years earlier than expected.
Budget gaps during FY 2024 through FY 2026 will average about $2.7 billion, an amount that has proven manageable historically. With the use of general and capital reserves, budget gaps will average about $1.4 billion, or less than 2% of city fund revenue, in line with pre-pandemic levels.
DiNapoli’s report notes that while the city’s current financial situation is much improved since the pandemic started, there are likely to be significant fiscal challenges ahead including possible impacts of geopolitical tensions and sanctions on Russia, inflation and the Federal Reserve’s response, financial and commodity market volatility, supply chain issues and the number of workers returning to the office.
Revenue growth is expected to average 2.4% from FY 2024 to FY 2026, but an unexpected decline would require at least a short-term fix using the city’s accumulated reserves or adjusting spending.
City-funded spending growth is expected to average 1.9% in the out-years, below expectations for inflation. This rate of growth would be affordable, but spending is unlikely to adhere to current projections.
DiNapoli identified several existing spending risks in the financial plan, including optimistic spending projections for overtime, Carter case spending (involving students with disabilities) and charter school spending. Combined with risks for funding MTA bus and paratransit support, the Public Health Corps initiative and several smaller programs, risks total more than $3 billion annually by FY 2026, with tax offsets bringing the net risk to about $2.1 billion.
Unforeseen risks to economic, revenue and spending projections and foreseeable, but difficult to quantify, concerns such as cost inflation and wage pressures are likely to emerge during the plan period as well.
DiNapoli’s report also found that the city anticipates $6.6 billion in reimbursements from FEMA over three years through FY 2022. As of February 2022, the city has collected or claimed $625 million of the amounts expected for FYs 2020 and 2021. The city has informed OSC staff that the time for claiming, billing and collecting of FEMA funds is taking longer than previous disasters.
DiNapoli encouraged city budget planners to look to further generate cost efficiencies, track the performance of services delivered amid changing staffing trends, and build up reserve levels as part of their overall budget management strategy. These actions would allow the city to address unexpected challenges, including new spending obligations, and to strengthen its fiscal foundation to keep New York City attractive for residents and visitors and create more economic opportunities.
Considering the substantial surplus, why is Mayor Adams insisting to continue to alter the health insurance for NYC retirees?
DiNapoli: Federal Aid, Increasing Tax Revenues and Savings Boost New York City's Surplus
by Tom DiNapoli - Office of the State Comptroller -
New York City is expecting to generate a surplus of $3.7 billion in fiscal year (FY) 2022 due to federal aid, better-than-projected tax revenues, and planned savings, according to a report released today by State Comptroller Thomas P. DiNapoli on the city’s February financial plan. The surplus could reach at least $4.5 billion, if revenue and spending remain on their current tracks, according to DiNapoli’s analysis.
“Strong revenue, a rebound in property values, and the restart of the city’s Program to Eliminate the Gap (PEG) will help produce significant recurring savings in the next few years and should help buffer the city from economic and fiscal uncertainty in the near future,” DiNapoli said. “The plan also addresses $1.2 billion in recurring risks my office previously raised. Still, more can be done to prepare for unforeseen risks and to manage challenges as increased spending is spurred by inflation and other fiscal pressures. The city should also look at more ways to generate cost efficiencies and build its reserves to secure a smooth recovery and help ensure the city’s quality of life over the long-term.”
Continued improvement in the city’s economic recovery since the beginning of the fiscal year is expected to provide $1.7 billion in better-than-projected tax revenues in FY 2022, according to its February plan. The restart of the PEG, fueled by reducing vacancies for aggressive hiring targets, is projected to create $866 million in savings in the current year and more than $1.1 billion annually in subsequent years.
The city’s financial position gives it an opportunity to increase its prepayments of FY 2023 spending, enhance its rainy-day fund or retiree health benefits trust, or reduce future expenses in other ways. The city currently plans to use the entire surplus generated this fiscal year to prepay a portion of its FY 2023 debt service and help it to balance the budget in that fiscal year.
The updated financial plan balances the budget for FY 2023 as the city moves closer to economic and budgetary normalcy. Federal aid will drop from 17% to 10% of projected annual spending, returning to its 10-year pre-pandemic average.
Property tax revenues are now expected to rise in FY 2023 by $1.5 billion from the prior year, an increase of $848 million from the November plan projection, with an anticipated increase in total property valuation of more than 8%. The projected valuation is expected to top the FY 2021 peak three years earlier than expected.
Budget gaps during FY 2024 through FY 2026 will average about $2.7 billion, an amount that has proven manageable historically. With the use of general and capital reserves, budget gaps will average about $1.4 billion, or less than 2% of city fund revenue, in line with pre-pandemic levels.
DiNapoli’s report notes that while the city’s current financial situation is much improved since the pandemic started, there are likely to be significant fiscal challenges ahead including possible impacts of geopolitical tensions and sanctions on Russia, inflation and the Federal Reserve’s response, financial and commodity market volatility, supply chain issues and the number of workers returning to the office.
Revenue growth is expected to average 2.4% from FY 2024 to FY 2026, but an unexpected decline would require at least a short-term fix using the city’s accumulated reserves or adjusting spending.
City-funded spending growth is expected to average 1.9% in the out-years, below expectations for inflation. This rate of growth would be affordable, but spending is unlikely to adhere to current projections.
DiNapoli identified several existing spending risks in the financial plan, including optimistic spending projections for overtime, Carter case spending (involving students with disabilities) and charter school spending. Combined with risks for funding MTA bus and paratransit support, the Public Health Corps initiative and several smaller programs, risks total more than $3 billion annually by FY 2026, with tax offsets bringing the net risk to about $2.1 billion.
Unforeseen risks to economic, revenue and spending projections and foreseeable, but difficult to quantify, concerns such as cost inflation and wage pressures are likely to emerge during the plan period as well.
DiNapoli’s report also found that the city anticipates $6.6 billion in reimbursements from FEMA over three years through FY 2022. As of February 2022, the city has collected or claimed $625 million of the amounts expected for FYs 2020 and 2021. The city has informed OSC staff that the time for claiming, billing and collecting of FEMA funds is taking longer than previous disasters.
DiNapoli encouraged city budget planners to look to further generate cost efficiencies, track the performance of services delivered amid changing staffing trends, and build up reserve levels as part of their overall budget management strategy. These actions would allow the city to address unexpected challenges, including new spending obligations, and to strengthen its fiscal foundation to keep New York City attractive for residents and visitors and create more economic opportunities.
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- Jun 27, 2017
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Does the concept of "inferior" Medicare imply that "superior" Medicare exists?
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- May 6, 2010
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- 16,224
Opt outs are still strongly encouraged. They signify our disapproval of the plan being forced on us. They must be done electronically. No paper. The link is:
https://nyc-ma-plus.empireblue.com/optout
Must submit a separate form for yourself AND any dependents.
https://nyc-ma-plus.empireblue.com/optout
Must submit a separate form for yourself AND any dependents.
- Joined
- May 6, 2010
- Messages
- 16,224
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- Nov 2, 2020
- Messages
- 1,085
Of course we have. Bait, switch and screw. I wonder if ulcers are covered because that's what this whole farce is giving me.