City and Insurer to Pay $53 Million Over Retiree Copay Lawsuit

The Mamdani administration and a major insurer agreed to pay up to $53 million to reimburse retired civil servants who said they’d been wrongly charged copays for medical visits. 

The settlement stems from a 2022 class-action lawsuit filed in state Supreme Court in Manhattan alleging the city improperly forced retirees to pay $15 copays for medical visits under EmblemHealth’s GHI Senior Care Plan, a supplemental benefit that covers costs that traditional Medicare does not pay.

In a phone interview Monday, the president of the NYC Organization of Public Service Retirees, which brought the lawsuit, praised the settlement — but said the retirees’ fight is far from over.

Marianne Pizzitola said her members are skipping oncology, occupational therapy and other treatments because of rising health costs. She invoked the image of a 100-year-old retired firefighter Dan Stromer, who lives on a $26,000 pension and whom she described as her organization’s oldest member.

“We need to roll back these regressive copays,” said Pizzitola. “I want what we had: traditional Medicare with the supplemental benefit.”

The settlement comes as Pizzitola’s group and its allies in the City Council seek to revive an effort to preserve traditional Medicare for the city’s retirees and block future efforts to raise their healthcare costs.

The agreement stems from copays that retirees were charged from Jan. 1, 2022 through Jan. 31, 2023.

Nicholas Paolucci, a spokesperson for the city Law Department, noted in a statement that the $15 copays were reinstated in January 2025. As part of what Paolucci called an “amicable settlement,” the Mamdani administration and EmblemHealth agreed not to increase the existing $15 Senior Care copay until 2028.

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A spokesperson for EmblemHealth said the insurer would inform its members about how to access their reimbursements. Up to 250,000 retirees could be eligible, according to the NYC Organization of Public Service Retirees.

“We are pleased that a settlement has been reached that avoids litigation,” EmblemHealth spokesperson Alex Gomez said in a statement. “From this agreement, a process has been established to assist members with reimbursement and provide information on next steps.”

Pizzitola’s group first sued the city and EmblemHealth in November 2022, after the administration of then-Mayor Eric Adams for the first time implemented the $15 copay in January of that year. Retirees were previously not charged a copay.

In their original lawsuit, the retirees claimed the city was in violation of a 2022 court order not to impose additional costs on retirees for the supplemental benefit. That order also left the door open for the Adams administration to move forward with a controversial attempt to shift retirees to Medicare Advantage, so long as they could opt out of that switch and keep their current GHI Senior Care Plan.

The retirees’ organization engaged in a lengthy legal battle over the planned Medicare Advantage switchover anyway, arguing the privatized plan offered inferior care and the city was legally required to offer its retirees premium-free healthcare. Though the state’s highest court eventually sided with the Adams administration, he backed out of the switch last June. (As a candidate, Mayor Zohran Mamdani pledged to “reject” Medicare Advantage if elected.)

Mamdani has not said how he plans to address the botched Medicare Advantage plan, which was intended to help the taxpayers save $600 million annually. A December 2025 audit by the city comptroller’s office declared insolvent a key fund that paid insurance premiums for city workers, retirees and their dependents, in part due to the Medicare Advantage debacle.

Christopher Marte, a Democratic City Council member representing Manhattan’s Chinatown, cheered news of the settlement on Monday. He told The City Reporter he intends to revive a bill that would ban the city from forcing retirees to enroll in what he described as “diminished” privatized healthcare plans, including Medicare Advantage, or to increase their healthcare costs.

“We are being really careful on how we define ‘diminished’ healthcare,” Marte said. “Forcing someone to pay a higher copay potentially can make it more difficult for someone to get the care that they were previously promised, limiting how many times an individual goes to those appointments, what type of care they pursue.”

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The post City and Insurer to Pay $53 Million Over Retiree Copay Lawsuit appeared first on The City Reporter.