Monday, May 31, 2010
Reduction of Medicare premiums reimbursed to retirees in NYSHIP, the NY State Health Insurance Program for State and Local Government proposed
Source: The NYS Legislative Retrieval Service - Assembly 9706-B
NYPPL notes the introduction of Assembly 9706-B, Part U, a measure that proposes an amendment to Civil Service Law §167-a that is draconian in nature and ignores completely the underlying reasons why §167-a was proposed and enacted into law in 1966.
A brief history lesson concerning the enactment of §167-a may be illuminating.
Many years ago Thomas McCracken, the then director of the Department of Civil Service’s health insurance unit, realized that the State could obtain substantial benefits in terms of a reduction in the employer’s contributions to the New York State Health Insurance Program for State and Local Government [NYSHIP] if individuals and the dependents of such individuals that were Medicare eligible retirees were to designate Medicare as their primary insurer.
Mr. McCracken was instrumental in the drafting and adoption of §167-a to this end. He also successfully advocated modifying NYSHIP's health insurance contracts to “exclude” from State health insurance coverage those benefits otherwise available to Medicare eligible retirees and their dependents under Medicare. The reason for this: Medicare premiums were less than the premium costs that would have been otherwise required were the State to continue to provide these benefits under NYSHIP.
In developing the plan, Mr. McCracken realized that, in effect, “excluding” such coverage in the NYSHIP contracts for health insurance mandated that the Medicare eligible retirees designate Medicare as their primary insurer or lose a significant portion of their health insurance coverage.
However, to maintain their same level of health insurance benefits, the Medicare eligible retiree would be required to pay the Medicare premium otherwise required for Medicare as well as their full employee contribution required for NYSHIP. Hence the amendment of the Civil Service Law to provide for the reimbursement of Medicare premiums to the Medicare eligible retirees set out in §167-a.
As an illustration, if the employee contribution for individual coverage in NYSHIP was $xxx per year, the Medicare eligible retiree would be required to pay $xxx for his or her NYSHIP participation and, in addition, pay $yyy per year for Medicare premiums. However, the Medicare eligible retiree would get the same level of health insurance otherwise available to the non-Medicare eligible individual under NYSHIP but would be required to pay more for the coverage.
To eliminate this adverse impact on Medicare eligible retirees, §167-a was enacted in order to provide for the reimbursement of Medicare premiums to Medicare eligible retirees, thus, once again, limiting their cost for health insurance to the $xxx per year that was required of active State workers and non-Medicare eligibles in NYSHIP while NYSHIP reaped substantial financial savings to the benefit of the State and NYSHIP’s participating employers.
Any action to reduce or impair the full reimbursement of Medicare premiums to Medicare eligible retirees as proposed by the drafters of Assembly 9706-B would result in the Medicare eligible retiree being required to pay more for the same level of health insurance benefits enjoyed by active employees and non-Medicare eligible individuals in NYSHIP, notwithstanding the fact that Medicare is providing benefits to Medicare eligible retirees that would otherwise be borne by NYSHIP thereby resulting in a significant reduced costs to the State and participating employers.
Simply stated, but for the Medicare eligible retirees participating in Medicare, the State’s and participating employer’s contribution for NYSHIP enrollees, active and retired, would be greater.
As to any argument that the State health insurance premiums need not be identical for active State employees and State Medicare eligible retirees, Civil Service Law §167, “Contributions,” demonstrates that the legislative intent was that such premiums be identical, regardless of employment or retirement status.
As evidence of this legislative intent, §167, in pertinent part, provides that “Nine-tenths of the cost of premium or subscription charges for the coverage of state employees and retired state employees retiring on or after January first, nineteen hundred eighty-three who are enrolled in the statewide and supplementary health insurance plans shall be paid by the state.” Accordingly, reimbursing the Medicare eligible retiree less than the full cost of his or her Medicare premium would be inconsistent with this legislative mandate that premiums for active employees and Medicare eligible retirees be identical.
To the same end, §167, in pertinent part, provides: “Three-quarters of the cost of premium or subscription charges for the coverage of dependents of such state employees and retired state employees shall be paid by the state.” Again, this intent of the legislative would be frustrated were the Medicare eligible retiree not reimbursed the full cost of Medicare eligible dependent Medicare premiums.
Clearly, §167 expresses the legislative intent that the premiums to be paid for health insurance were to be identical for active State employees, State retirees and State Medicare eligible retirees and their respective dependents.
Further, this is true with respect to “the premium or subscription charges for the coverage of each state employee or retired state employee who is enrolled in an optional benefit plan and for the dependents of such state employee or retired state employee.” §167 provides that such individuals are entitled to “the same dollar amount which would be paid by the state for the premium or subscription charges for the coverage of such state employee or retired state employee and his or her dependents if he or she were enrolled in the statewide and the supplementary health insurance plans, but not in excess of the premium or subscription charges for the coverage of such state employee or retired state employee and his or her dependents under such optional benefit plan.”
As to others in the State’s health insurance plan, §167 provides that “employees of the state colleges of agriculture, home economics, industrial labor relations, and veterinary medicine, the state agricultural experiment station at Geneva, and any other institution or agency under the management and control of Cornell University as the representative of the board of trustees of the state university of New York, and employees of the state college of ceramics under the management and control of Alfred university as the representative of the board of trustees of the state university of New York, shall be deemed to be state employees whose salaries or compensation are paid directly by the state.”
On a related point, there seems to be a perception on the part of some that §167-a distinguishes between Medicare Part A, Medicare Part B, etc. Clearly such is not the case. §167-a speaks to reimbursement of “Medicare premium charges” generically, not in terms of reimbursement of the cost of any part or subdivision of the Federal Old-age, Survivors and Disability Insurance Program and provides for the reimbursement of “an amount equal to the premium charge for such supplementary medical insurance benefits for such active or retired employee and his or her dependants.”
One can only hope that Medicare eligible retirees and their Medicare eligible dependents participating in NYSHIP are not faced with a situation whereby the proponents of this legislation are saying “don’t confuse us with the facts, our minds are made up!”
Saturday, May 29, 2010
Donohue et al v Paterson, USDC, Northern District of New York, 1:10-CV-00543 (LEK/DRH) [Filed May 28,2010]
Federal District Court Judge Lawrence E. Kahn ruled that the CSEA and the other unions suing the State in an effort to bar the furloughing of State workers “have met their burden of showing irreparable harm and a substantial likelihood on the merits of their claim.”
Judge Kahn issued a preliminary injunction enjoined the State “from submitting, enacting, or implementing emergency appropriations bills containing the furlough and wage provisions" objected to the unions.
The “Furlough of State Workers” decision by Federal District Court Judge Lawrence E. Kahn is posted on the Internet at: http://www.scribd.com/doc/32128536/Furlough-Decision1
Friday, May 28, 2010
Source: Office of the Governor
On May 28, 2010, Governor David A. Paterson reported that the State Legislature passed his bill authorizing an early retirement incentive. This bill, said the Governor, will provide State agency and local governments “with an additional mechanism to achieve necessary workforce cost savings.”
The statute, which was the Governor's Program Bill No. 249, establishes a temporary retirement incentive program for certain State and municipal public employees.
Public employees will be able either to retire without penalty at 55 years of age with a minimum of 25 years of service, or receive an additional month of member service credit in their retirement system – not to exceed 36 months – for each year of service.
According to a press release issued by the Governor’s Office, the early retirement incentive consists of two parts, Part A and Part B.
Part A: Part A provides a targeted incentive to positions that can be abolished and provides an additional month of retirement service credit for each year of credited service, up to a maximum of three years of additional member service credit.
Employers that elect to participate in Part A will be required to provide a 30- to 90-day open period to allow eligible employees adequate time to consider the incentive.
Municipalities that choose to “opt-in” to Part A must do so on or before August 31, 2010 and school districts must do so by July 30, 2010. Eligible employees must be currently eligible to retire, or be at least 50 years of age with ten or more years of service.
Part B: Part B provides employees in the Executive Branch of State government [and participating local government employees with the option to retire without penalty to employees at age 55 with at least 25 years of service. Participating employers will be required provide a 90-day open period to allow eligible employees adequate time to consider the incentive.
Employers may elect on or before September 1, 2010 to provide employees the benefits of Part B, and “education employers” must “opt-in” by July 1, 2010.
However, employees meeting the required criteria may not be permitted to participate in Part B if it the employer determines that the employee holds a position that is “critical to the maintenance of public health and safety.”
The text of the measure, Governor’s Program Bill 249, is available on the Internet at: http://www.ny.gov/governor/bills/pdf/gpb_249.pdf
N.B. Chapter 45 of the Laws of 2010, signed into law by the Governor on April 14, 2010, provides early retirement incentives to certain employees in public higher, secondary and elementary education employed by:
1. "Participating employers" i.e., an educational employer, the state-operated institutions of the State University of New York, and a community that employs members who hold positions represented by the recognized collective bargaining units affiliated with the New York State United Teachers Employee Organization]; and
2. "Educational employers" i.e., a school district, a board of cooperative educational services, a vocational education and extension board, an institution for the instruction of the deaf and of the blind as enumerated in Section 4201 of the Education Law, or a school district as enumerated in Section 1 of Chapter 566 of the Laws of 1967, as amended.
Chapter 45 covers employees holding positions represented by the recognized collective bargaining units affiliated with the New York State United Teachers employee organization that participate in the New York State Teachers' Retirement System and the New York State and Local Employees' Retirement System.
Appellate Division lacked “discretionary authority” to vacate the disciplinary penalty imposed by the appointing authority
Matter of David Torrance v Joseph A. Stout, 9 NY3d 1022
David Torrance was employed a Park Foreman by the Westchester County Department of Parks, Recreation and Conservation. He was found guilty of disciplinary charges alleging he “engaged in the willful and intentional illegal disposition of County property.” The penalty imposed: demotion to the position of Maintenance Laborer.
Torrance appealed and the Appellate Division ruled that although the determination that the he was guilty of misconduct is supported by substantial evidence, considering all of the circumstances, the penalty of demotion from the position of park foreman to the position of maintenance laborer “after 21 years of unblemished service, and its long-term financial implications for the petitioner, was so disproportionate to the offense committed as to be shocking to one's sense of fairness.”
The Court of Appeals, citing Matter of Pell v Board of Education, 34 NY2d 222, disagreed, holding that imposing the penalty of demoting Torrance to a non-supervisory position “does not shock the judicial conscience,” and reversed the Appellate Division’s ruling.
Further, the Court of Appeals said that the Appellate Division “has no discretionary authority or interest of justice jurisdiction in this CPLR article 78 proceeding to review the penalty imposed …” citing Rutkunas v Stout, 8 NY3d 897, another case in which another Westchester County Department of Parkes employee challenged the disciplinary penalty imposed by Commissioner Stout.
In Rutkunas, the Appellate Division annulled the Westchester County Department of Parks, Recreation, and Conservation Commissioner’s decision to adopt the recommendation of a hearing officer to terminate Anthony Rutkunas. Rutkunas was found guilty of charges of misconduct but the Appellate Division remanded the matter back to the Commissioner “and in the exercise of [its] discretion” in order for the Commissioner “to impose an appropriate penalty less severe than termination” upon Rutkunas.
The Appellate Division’s rationale: “under the circumstances, including, but not limited to, the petitioner's lack of a prior disciplinary history, minimal prospects of alternative employment, and the devastating impact the sanction of termination imposes on his ability to support his family, the penalty of dismissal was so disproportionate to the offense committed as to be shocking to one's sense of fairness.”
The Court of Appeals reversed the Appellate Division’s action, commenting that Rutkunas’ conduct jeopardized the health and safety of his coworkers and of the public patrons of the facility at which he worked and thus “we cannot conclude that the penalty of dismissal imposed . . . shocks the judicial conscience as a matter of law.”
Further, said the court, the Appellate Division has no discretionary authority or interest of justice jurisdiction in this CPLR article 78 proceeding to review the penalty imposed by the appointing authority.
The decision is posted on the Internet at: http://www.nycourts.gov/reporter/3dseries/2008/2008_00180.htm
Monday, May 24, 2010
Miller v New York City Dept. of Education, 2010 NY Slip Op 31210(U), May 11, 2010, Supreme Court, New York County, Judge Jane S. Solomon [Not selected for publication in the Official Reports]
The general rule is that once the public officer or employee delivers his or her resignation to the appointing authority or the appointing authority's designee, approval of a request to withdraw or rescind the resignation is subject to the discretionary approval of the appointing authority.*
Adam Miller, a New York City school teacher with tenure, and his principal had difficulties and ultimately he submitted his resignation from his position.
Miller alleged that he had submitted his resignation after Joseph D'Amico, a union official confirmed with Miller's then principal that her policy was: "[I]f she had a signed resignation letter,” she would give the individual a satisfactory evaluation and in the event the individual found another position “during the summer, then the resignation would not take effect, she would simply release the person."
When Miller subsequently attempted to obtain a teaching position at another Department of Education school, he was unsuccessful. The reason for this, he discovered, was that his former principal had not changed his "Unsatisfactory" rating to a Satisfactory rating.
When the New York City Department of Education refused to allow Miller to withdraw his resignation, he file a petition pursuant to Article 78 in an effort to obtain a court order directing the Department to void the resignation and reinstate him to his former position.
Miller argued that the principal had induced him to resign by “dishonestly promising to change his 'U' rating to an 'S' rating."
The Department did not deny that principal had made such a representation. Rather, the Department argued, the principal's promise was premised on Miller resigning before the unsatisfactory rating was issued, which he failed to do.**
Judge Solomon held that while “A teacher may voluntarily relinquish tenured rights by
resigning ... a teacher's resignation which has been obtained by fraud or which is the result of coercion or duress does not represent a voluntary act and may be nullified".
Finding that Miller's resignation was the result of such coercion and dishonesty, the court nullified his resignation and directed his reinstatement with back salary.
Sometimes an appointing authority will demand that the employee does not submit his or her resignation, he or she will be served with disciplinary charges. The employee elects to submit the resignation only to later attempt to withdraw it based on the claim that it was coerced.
A demand for the resignation under such circumstances, however, may not constitute coercion.
For example, in Rychlick v Coughlin, 63 NY2d 643, the Court of Appeals ruled threatening to do what the appointing authority had a right to do -- i.e., file disciplinary charges -- did not constitute coercion so as to make the resignation involuntary.
* Except where required by law, acceptance of a resignation is not required for it to take effect; all that is required is that the resignation be delivered to the appointing authority before it is withdrawn or rescinded by the officer or employee.
** Judge Solomon noted that the Department failed to submit any affidavit signed by the principal nor was the answer submitted to the court verified by her. In a “missing witness situation,” as the court found was here the case, ”the court, as trier of fact, may draw the strongest inference that the opposing evidence permits.”
The decision is posted on the Internet at: http://www.courts.state.ny.us/reporter/pdfs/2010/2010_31210.pdf
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