ALBANY — A panel of judges on New York’s highest court heard final arguments on Thursday in the long-running case over the fate of a controversial plan to switch the city’s 250,000 retirees to Medicare Advantage —- and the hundreds of millions in annual savings for health costs tied up in the deal.
Central to the case before the Court of Appeals is the question of whether or not the planned switchover violated guarantees by the city that every retired city worker is entitled to city-funded health care through a combination of Medicare and other supplemental insurance.
A Manhattan Supreme Court judge sided with a group representing city retirees in a decision in the summer of 2023 that also banned the city from carrying out the plan, which was negotiated with the city’s labor unions with then-mayor Bill de Blasio. Before that court defeat, the plan was set to go into effect that September as a means to secure more than $600 million in annual savings to the city’s stabilization fund that covers some premiums for active city workers.
Lawyers for the Adams administration have filed multiple appeals but appellate judges have sided with the retirees in every instance. The Court of Appeals is expected to issue its decision in the coming months.
In a tidy 30-minute hearing, the court’s seven judges grilled attorneys for the city and the plaintiffs, the NYC Organization of Public Service Retirees, over whether traditional Medicare was ever explicitly promised to city retirees — with several justices turning the screws on the city over assertions not only by the retirees’s lawyers but in an affidavit submitted by a former deputy mayor that the health care benefits were a decades-long “essential recruitment and retention tool” for the city.
“We are confident that the facts and fairness are on our side, and that the equities are on our side,” Jacob Gardener, the attorney for the retirees, told THE CITY. “They have to determine whether the city can be bound by promises that it made, or statements that it made — and I think the law is clear that it can be bound.”
The retirees have argued that their right to city-funded health care is enshrined in the city Administrative Code and under a legal doctrine known as “promissory estoppel;” in this case, that the city made a clear and unambiguous promise over more than 50 years — in HR meetings, recruitment materials and other communications — that employees would be entitled to traditional Medicare, with the city covering their premiums upon retirement.
The courtroom’s 65 public seats were packed with retirees bussed to Albany from Manhattan by the NYC Retirees, while more than a dozen others watched the hearing on a screen in an overflow room.
Many retirees in the courtroom stirred as the judges grilled the two attorneys over the question of whether the “promise” of traditional Medicare benefits was verbally made by HR managers to every city worker upon retirement. “Yes. Yes!” they loudly whispered.
“It’s exasperating, because the questions that they’re asking, sometimes I think they didn’t read the full record or they don’t understand the position that we’re in or the promises that were made,” said Marianne Pizzitola, the president of the retiree organization. “Many of us, many of the people that are here today — they took that job for that reason.”
Retirees have long argued that Medicare Advantage plans offer inferior health care and higher costs. Connie Canaras, a retired public school teacher, called out Mayor Eric Adams, who has invoked the memory of his late mother, a city retiree, to position himself as a mayor for the working class.
“How in all consciousness could he think that Medicare Advantage was as good as Medicare and the supplement that we are receiving now?” said Canaras. “I’d ask him, would you want your mother to be on Aetna Medicare Advantage?”
Bargaining vs. Lawmaking
As the matter plays out in court, efforts to enshrine retiree’s health benefits through legislation have stalled in the state legislature and the City Council as labor leaders — including many of those who struck the agreement to switch over to Medicaid Advantage in the first place — object that those efforts infringe on their collective bargaining rights.
On Thursday, the United Federation of Teachers — which walked back its support for Medicare Advantage last summer as insurgents unhappy with that deal are challenging longtime leader Michael Mulgrew in the union’s own election — chose to endorse a candidate challenging the bill’s main sponsor in the Council.
The union had previously endorsed that lawmaker, Chris Marte of Lower Manhattan, in 2023.
Councilmember Christopher Marie (D-Manhattan) speaks to city retirees ahead of their trip up to Albany to attend a court hearing in their case against them being put on a Medicare Advantage plan, May 15, 2025. Credit: Ben Fractenberg/THE CITY
In a statement to THE CITY, Marte said he believed the union’s snub was in retaliation for his support of the anti-Medicare Advantage bill; the union said it simply chose to endorse a different candidate.
It follows a decision by District Council 37, first reported by the Daily News, to rescind its endorsement of Council member Alexa Avilés of Sunset Park over her support of Marte’s bill. (The UFT, however, did endorse Avilés on Thursday, and several other lawmakers who’ve signed on to the bill.)
“I believe that UFT’s endorsement of my opponent is definitely because I introduced Intro-1096 to stop the privatization of city retirees’ health care,” said Marte. “We are confident that many UFT members — active and retired — will come out strong in this election to defend the healthcare that was promised to them, and that I’m fighting for in the City Council.”
Marte dropped by a brief demonstration by the retirees across from the City Council’s offices at 250 Broadway near City Hall before they loaded their buses to Albany early Thursday morning. Alongside him in solidarity with the retirees was independent mayoral candidate Jim Walden, who was endorsed by the retirees’ group in November.
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