Mamdani must shield city retirees from Medicare scam

Zohran Mamdani campaigned on the idea that the government should make life better and more affordable for the working class and protect them from corporate greed and corruption. His critics called his program delusional and dangerous.

Mayor Mamdani can prove his critics wrong and demonstrate his commitment to his principles by making traditional Medicare a central pillar of his health policy.

Medicare is a public health insurance program for older adults. Under traditional Medicare, the federal government pays doctors directly for the services they provide. Seniors can see virtually any doctor (since almost all doctors accept traditional Medicare) and receive any care their doctor orders (since no insurance company denies coverage).

When combined with a Medicare supplement plan, which the city has historically provided to Medicare-eligible retired city workers, the costs are minimal. In short, traditional health insurance is effective, life-saving and affordable.

Medicare Advantage (“MA”) – a private, for-profit alternative to traditional Medicare – is none of these things.

Under MA, money flows through insurance companies. The federal government pays insurers to cover seniors who enroll in their MA plans, with the payment amount varying depending on the health status of the seniors (as reported by insurers). Insurers profit by pocketing what they don’t spend. The original idea behind MA was to let market forces reduce the cost of health care and improve its efficiency. It was a spectacular failure.

As countless empirical studies have confirmed, MA plans cost taxpayers far more than traditional Medicare, even though they spend far less on patients and produce worse patient outcomes. Why then? Corporate greed and corruption.

MA insurers (i) fraudulently overcharge the government by exaggerating patients’ medical problems and (ii) improperly deny coverage for care that these elderly and infirm people desperately need. This greed and corruption has generated historic profits for MA plans (indeed, MA plans are the most profitable insurance product). They also resulted in criminal charges and civil fraud suits against most major MA insurance companies.

Worse yet, a large percentage of medical providers refuse to accept MA plans. According to an October 2024 U.S. Senate report, “61% of health systems plan to stop accepting all Medicare Advantage patients in the next two years, or definitely will.” Doctors despise MA plans because insurers make it almost impossible for them to do their job. Insurers drown them in prior authorization formalities, refuse to cover their patients’ care, refuse and delay payments.

Because MA plans prevent access to doctors and life-saving treatments, patients are often forced to choose between paying out of pocket or forgoing medical care. In short, MA plans are a nightmare for older people when they get sick, especially if they are on low incomes.

Disgraced former Mayor Eric Adams opposed MA when he ran for office in 2021. He said it would “devastate” and “traumatize our retirees.” However, after becoming mayor, he quickly changed course and sought to force the city’s retirees into an MA plan. He said it would help balance the city’s budget. The New York City Independent Budget Office has deemed this claim false.

The truth was that the MA plan would have funneled money from low-income seniors into a discretionary fund controlled by the mayor and union leaders. Adams also claimed that an MA plan could be as good as traditional Medicare. The retirees revealed the truth in litigation, leading the courts to conclude that MA would cause irreparable harm to the elderly. Eventually, Adams gave up.

During last year’s campaign, Mamdani quietly posted a statement on his website pledging to “reject Medicare Advantage.” However, since taking office, he has not publicly addressed the subject. This is a missed opportunity. Mamdani should proudly reaffirm his commitment to traditional health insurance. This health care program is one of the government’s most compelling examples of making life better and more affordable for the working class and protecting them from corporate greed and corruption.

MA enriches insurance companies at the expense of vulnerable seniors. No city leader, and especially no leader with Mamdani’s political beliefs, should ever force retirees there.

Pizzitola is president of the New York City Civil Service Retiree Organization, which represents 300,000 retired members of the city’s municipal workforce who are Medicare retirees.