CAS WINS MEDICARE PART D REIMBURSMENT LITIGATION FOR RETIREES

CAS has won a State Supreme Court case on behalf of a retiree from the East Islip Union Free School District in relation to Medicare Part D reimbursements.

By way of background, in January of 2011, the Affordable Care Act (“Obamacare”) created financial incentives for employer-sponsored health plans to have a Medicare Part D prescription drug plan.  The Affordable Care Act also established an income related monthly adjustment amount (IRMAA) for Medicare Part D, which is known as the Part D-IRMAA.  The Part D-IRMAA is an amount added to the Part D monthly premium for individuals whose modified adjusted gross income (MAGI) exceeds$85,000 for individuals or $170,000 for married couples filing jointly.

Effective January 1, 2013 all Medicare-primary retirees were involuntarily enrolled in Empire Plan Medicare Rx (PDP), a Medicare Part D prescription drug plan, this resulted in retirees being subjected to a Medicare Part D premium and additional IRMAA payment

However, in the collective bargaining agreement between the East Islip Union Free School District [“district”] and East Islip Association of School   Administrators [“association”] it stated that unit members with 20 years in the District shall receive one hundred percent (100%) of health insurance into retirement. 

CAS on behalf of the retirees asserted that the above language required the District reimburse all expenses related to health insurance, include Medicare Part D IRMAA. The District however took the position that this did not apply to Medicare Part D IRMAA premium payments since that payment was paid directly to Social Security and therefore were not health insurance premiums in the conventional sense.

CAS attorney, Brad Stuhler, filed a breach of contract action in State Supreme Court on behalf of retiree Patricia Cuccia, and all other similarly situated East Islip retirees, alleging that the District’s failure to reimburse the cost of Medicare Part D- IRMAA violated the collective bargaining agreement.

After oral arguments were held, Supreme Court Justice Daniel Martin, issued his decision ruling in favor of the lawsuit filed by CAS counsel.  The Judge specifically held that the District in fact violated the collective bargaining agreement when it failed to reimburse retirees for the Medicare Part D- IRMAA payments.  The judge ordered the district to reimburse all retirees for the cost of the Medicare Part D IRMAA.

CAS is very pleased with the decision reached by the State Supreme Court in this matter and as always will continue to fight on behalf of all members to ensure that the terms of their collective bargaining agreements are honored.