State unions sue over 2% healthcare cost hike

The labor groups assert that the changes are illegal because they were not made as a result of collective bargaining. They sued the governor, the state Department of Civil Service and the New York State Health Insurance Plan in federal court.

“The state’s action to unilaterally raise the level of contributions retirees pay for their health insurance is unconstitutional, arbitrary and capricious, and amounts to a breach of our contract,” said Phil Smith, president of United University Professions, one of the plaintiffs, which represents State University of New York faculty. “It’s totally wrong to saddle our retirees who are on fixed incomes with this unexpected increase in their health insurance costs.”

The Cuomo administration could not immediately be reached for a response to the suit. But the New York Post reported that Cuomo spokesman Josh Vlasto said, “The law clearly allows the administration to apply the terms of a new contract to retirees, and it has been well-known, standard practice to do so.”

Vlasto added that a change to the law made in 2009 allowed the state to pass some Medicare premium costs along to retirees, who previously had not paid any, the Post said.

The governor has made clear since his run for office that because of the state of the economy and Albany’s financial problems, his administration would put an end to business as usual when it comes to ever-increasing public employee salaries and benefits. In June, he got the Civil Service Employees Association to agree to a contract including concessions that are expected to save the state $73 million in the first year and $1.6 billion over five years.

But the unions said the new costs on retirees amount to changing the rules in the middle of the game.

“What the Cuomo administration is trying to do is pull the rug out from under state retirees, many of whom planned their retirements based on when they felt they could afford to retire,” said Ken Brynien, president of the Public Employees Federation, another of the unions that lodged the suit. “These decisions were based on a promise and expectation of what their health insurance costs would be. Changing the rules after the fact is outright wrong.”

In addition to the CSEA, PEF and UUP, the unions behind the legal action are the New York State Correctional Officers and Police Benevolent Association, New York State Troopers Police Benevolent Association, New York State Police Investigators Association and Council 82, the law enforcement arm of the American Federation of State, County and Municipal Employees.

They say that in addition to the hikes already imposed, the administration plans a 6 percent increase for retirees who retire on or after Jan. 1, 2012, asserting “These changes will result in a 60 percent increase in contribution costs for individual coverage and a 24 percent increase for dependent coverage.”