Aetna reveals well being care denial charges in Medicare Benefit court docket case for NYC retirees

Aetna, the insurance coverage supplier chosen to service a well being care swap for 250,000 municipal retirees, now desires an opportunity to defend the plan in court docket.

The corporate submitted a petition Tuesday to intervene in a lawsuit that New York Metropolis retirees filed in opposition to the town and Mayor Eric Adams in Manhattan Supreme Courtroom final month. The lawsuit is the second try by metropolis authorities retirees to dam the Adams administration’s effort to switch them from conventional Medicare to a privatized model of the well being care plan referred to as Medicare Benefit.

In supplies submitted to the court docket, Aetna outlines what it views because the deserves of the brand new well being plan and efforts to teach retirees in regards to the modifications underway.

Paperwork shared with Gothamist additionally confirmed that as of June 6, solely 979 municipal retirees and dependents had opted out of the brand new Medicare Benefit plan. Members who decide out can both enroll in one other different metropolis plan, often called HIP VIP — or decline metropolis protection altogether and enroll in conventional Medicare independently. However they’ll lose city-funded advantages and need to pay for any supplemental protection themselves.

The low variety of opt-outs signifies that, “regardless of the noise about Medicare Benefit plans, retirees overwhelmingly like what they see in our plan,” in response to Rick Frommeyer, senior vice chairman of Aetna’s Group Retiree Options.

However Marianne Pizzitola, a retired FDNY employee who serves as president of the NYC Group of Public Service Retirees, mentioned that’s as a result of they weren’t given any good options.

“The one individuals that might be prepared to waive their metropolis well being advantages and all their reimbursements are excessive earners,” Pizzitola mentioned.

Aetna’s transfer is the most recent marketing campaign to persuade skeptical retirees and different vocal opponents of the deserves of the shift.

New York Metropolis Comptroller Brad Lander declined to register the town’s contract with Aetna final week, citing the continuing lawsuit.

“I’m significantly involved in regards to the privatization of Medicare plans, overbilling by insurance coverage corporations, and boundaries to care below Medicare Benefit,” Lander mentioned in a statement on the time.

Lander acknowledged that the choice was based mostly purely on procedural considerations, however his workplace advised Gothamist this week that the mayor might override the transfer.

9 retired metropolis staff filed the lawsuit — together with the NYC Group of Public Service Retirees, a gaggle that shaped to combat the Medicare Benefit shift. They declare that the Adams administration is violating metropolis regulation by diminishing their advantages and never paying for SeniorCare, the supplemental protection that was beforehand offered by the town for free of charge to metropolis staff.

Aetna, Adams and a committee of municipal labor unions collaborated on the plan and have argued that the brand new advantages will probably be comparable – if not higher – than what members beforehand had, with out growing their out-of-pocket prices. Plus, the plan is designed to save lots of the town an estimated $600 million a yr on well being advantages, because of federal funding accessible for Medicare Benefit plans.

Adams beforehand sought to take care of the choice for retirees to remain on conventional Medicare, with the Senior Care complement, for a payment of $191 a month. However that transfer was blocked in court docket as a result of it might violate the town’s administrative code. Consequently, Adams eradicated that choice altogether.

Now, if the swap goes ahead, some 250,000 municipal retirees and their dependents will probably be shifted to Aetna’s Medicare Benefit plan routinely on Sept. 1. June 30 is the deadline for opting out, and one other window is not going to arrive till subsequent yr’s enrollment interval.

Will metropolis retirees be denied care?

Pizzitola and others who oppose the swap have raised considerations in regards to the want for docs to get prior approval for extra providers below Medicare Benefit than conventional Medicare – and a federal investigation has revealed that below Medicare Benefit plans, claims are typically inappropriately denied.

Aetna is in search of to exhibit — through supplies submitted to the court docket — that its current Medicare Benefit plans throughout the nation hardly ever reject protection for wanted well being providers. These paperwork define how these denials can be much more rare below its plan for New York Metropolis authorities retirees.

In response to Aetna, out of greater than 82 million claims below its Medicare Benefit plans final yr, only 3.4% had been topic to prior approval, and 0.49% of all claims had been denied. That also quantities to at the least 401,000 claims denied. Primarily based on these figures, Aetna rejected about 14.4% of the claims that had been submitted for prior approval.

In 2021, the corporate’s Medicare Benefit plans both partially or absolutely denied about 12% of requests for prior approval, tied for the best denial price of main insurance coverage corporations studied by the health policy nonprofit KFF. Aetna has mentioned that the denial price can be decrease for New York Metropolis’s plan.

“I’ve no foundation to problem their numbers,” mentioned Barbara Caress, who teaches well being coverage at Baruch Faculty and beforehand served as director of strategic and coverage planning for the union 32BJ’s profit funds.

However she mentioned the numbers don’t seize the phenomenon of docs not bothering to hunt prior approval for medical providers they assume will probably be rejected below Medicare Benefit. Caress mentioned she can be curious whether or not Aetna finally denies providers which are dearer – versus procedures which are really not really useful or deemed pointless.

Caress mentioned will probably be essential to evaluate how individuals use their well being advantages within the first yr of the Medicare Benefit plan if it goes by way of.

Have you ever had protection below a Medicare Benefit plan in New York Metropolis? We need to hear about your expertise. E mail Caroline Lewis at [email protected].

This story was up to date with further data on Aetna’s denial charges.