Dear New Yorkers,

The skyline is looking much clearer today, but air quality remains quite poor. So please consider staying indoors and wearing N95 masks when you’re go outside. You can sign up for real-time air quality updates here and monitor your neighborhood’s air quality here.

There’s another important update to share: Yesterday, the Office of the Comptroller declined to register the City’s contract with Aetna to transfer City retirees to a Medicare Advantage program for their health care coverage.

A pending lawsuit, brought on behalf of retirees, questions the City’s authority to enter into such an agreement.

Our office carefully reviewed the City’s contract with Aetna and returned the contract to the Office of Labor Relations without registering it. Pending litigation calls into question the legality of this procurement and constrains us from fulfilling our Charter-mandated responsibility to confirm that procurement rules were followed, sufficient funds are available, and the City has the necessary authority to enter the contract.

This decision sends the contract back to the Mayor. He could decide to wait until the judge rules on the lawsuit (the City’s written response to the suit is due on June 16th). Or, the City Charter contains a provision that enables him to implement the contract over our rejection.

As a matter of public policy, beyond the scope of our office’s specific Charter responsibility for contract registration, I am seriously concerned about the privatization of Medicare plans, overbilling by insurance companies, and barriers to care under Medicare Advantage.

I appreciate the work of the Municipal Labor Council and the Office of Labor Relations to negotiate improvements to the Aetna contract to address some of the concerns raised by retirees.

However, the broader Medicare Advantage trends are worrisome. Recent investigations identified extensive allegations of fraud, abuse, overbilling, and denials of medically necessary care at nine of the top 10 Medicare Advantage plans, including CVS Health, which owns Aetna.

And as health care activist Ady Barkan wrote last month (noting that half of Medicare enrollees nationwide have been transferred from traditional Medicare to private Medicare Advantage plans): “Once corporations privatize every inch of the public provision of health care, we may never get Medicare back.”

Thanks,

Brad

P.S. If the Medicare Advantage contract has prompted your interest in the City’s procurement process, you can learn a ton about City contracting in our Annual Contracts Report. And if you’re interested in specific contracts, our award-winning Checkbook NYC database is a great resource.