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City retirees file suit over Medicare costs

Retired blue-collar city employees are claiming the city has not lived up to its agreement to provide them fully paid health insurance because their carrier is requiring them to pay for Medicare, according to a recent lawsuit.

Some public employees who have retired from local governments in New York State have agreements with their employers that preserve their health care benefits at no cost to them when they retire. Buffalo has in the past negotiated similar agreements.

In a class-action lawsuit filed last month in State Supreme Court against the city and Mayor Byron W. Brown, 10 plaintiffs, formerly of the AFSCME Local 264 bargaining unit, say they represent between 300 and 500 of their former colleagues, all of whom retired before Jan. 1, 2009. The suit also includes the spouses of living retirees.

The suit says the plaintiffs retired with clear agreements with the city that they were to receive health insurance benefits “without any cost to them.”

But a letter sent by health insurer BlueCross BlueShield on Aug. 1, 2008, states that the company would begin enforcing a provision of the policy that requires Medicare-eligible customers to enroll in the federal program. Medicare-eligible retirees and their eligible spouses were asked to enroll in Medicare Part B, which requires a premium of approximately $1,200 per person. The private insurer would cover whatever costs the government program did not cover, assuming that deductibles and co-payments had been met, according to the letter.

If the retiree did not enroll, the retiree would be responsible for paying what Medicare would have paid.

“The effect of this mandate is a clear diminution of the guaranteed lifetime retiree health insurance benefit contained within various [collective bargaining agreements] negotiated between the city and union,” the suit states.

The effect of the change is that the city is no longer paying the policy’s full bill, according to the suit.

Collective-bargaining agreements effective at the time the plaintiffs retired said that upon retirement and until they die, employees would receive the health plan in effect on the last day of their service to the city, according to the lawsuit.

The retirees are looking for compensation to make up for the health insurance payments they have made.

Buffalo firefighters have a similar complaint with the city pending, according to Thomas P. Barrett, vice president of the Buffalo Professional Firefighters Association.

A spokesman for the city declined to comment.

A lawyer for the plaintiffs did not return a telephone message Monday.