An egg-whip sounds like a festive, holiday drink or a merengue dessert. It is anything but a delightful treat.
Egg-Whip is the healthcare industry’s name for Employer Group Waiver Plans (EGWP), a provision for privatization of employer-based, retiree Medicare benefits that was written into the Medicare Modernization Act (MMA) of 2003. That law, which House Energy and Commerce Chair Billy Tauzin twisted arms to pass, added a drug plan to Medicare, not by including drugs as covered Medicare benefits, but by compelling seniors to purchase private drug plans. Big Pharma gained a massive influx of government money into its coffers and rewarded Tauzin with a $2-million-a-year job.
That’s what we could see on the surface. Who knew then that hidden in the MMA law was further privatization of Medicare beyond this privatized, publicly-subsidized drug plan known as Medicare Part D.
The Egg-Whip allows employers that have committed to provide health benefits for retirees to force those seniors, without their consent, into private, for-profit Medicare Advantage plans that impose conditions on the promised benefits.
This other provision in the MMA, the Egg-Whip, allows employers that have committed to provide health benefits for retirees to force those seniors, without their consent, into private, for-profit Medicare Advantage (MA) plans that impose conditions on the promised benefits.
These private employer-based Egg-Whip MA plans are exempt from requirements that individual Medicare Advantage plans must meet. The MA Egg-Whip plans “can set their own enrollment deadlines, send members information without prior CMS approval for accuracy, and follow weaker requirements for provider networks, among other things,” according to Susan Jaffe of Kaiser Health News.
Chris Maikels of Mercer Marketplace, a retiree benefits company, claims that his clients have saved up to 50% by moving retirees into MA private plans. “Employers find Medicare Advantage [plans] appealing because they can drive significant savings,” he asserts.
For the retirees who are forced into Egg-Whips, the results are not so appealing. A private for-profit middleman is placed between the beneficiaries and their physicians. Medicare funds are funneled through these plans. The more the plans limit, delay, and deny care, the greater the profits. The beneficiaries’ interest in care is diametrically opposed to the pecuniary interests of the insurance companies, such as Humana, United Health Care, or Aetna, through which their Medicare benefits are now funneled. Physicians’ decisions can be overruled by the money men who demand prior authorization. The best cancer centers and rehab facilities are off-limits. The network of approved providers may be limited to a geographic region. Doctors come and go from the network. The co-payments will escalate with the gravity of the illness.
Employers who seek the savings of private MA plans hide these detrimental characteristics of Egg-Whips by touting additional benefits like gym memberships, coverage for dental and eyeglasses, no co-pays on some procedures, and more. Those extra benefits are icing on the cake—but there’s no cake underneath.
In a country inundated with Medicare Advantage ads falsely praising the benefits of such plans, it is amazing that grassroots organizations of retirees have cut through the gibberish, exposed the lies, and are fighting to keep their traditional Medicare with promised supplementary coverage.
And they’re winning, too!
Retiree organizations in Vermont, New York, and Delaware have put thousands into motion as they rip down the curtains that have hidden Medicare Advantage from the nation’s understanding and righteous anger.
The Vermont State Employees Association (VSEA) effectively stopped Governor Phil Scott from moving state retirees to a private Medicare Advantage plan. State officials asserted that such a change would maintain the same level of coverage for retirees and save them an average of 20% on their premiums while saving money for the state of Vermont.
The Vermont State Employees Association knew better. Steve Howard, Executive Director of the VSEA, asserted that this was an end run around their rights, under the collective bargaining agreement, to have the same health benefits as the active state employees. “We’re gonna fight with everything we have,” Howard said. “If we have to go to court, we’ll go to court.” We refuse to agree to “privatize this benefit out to an industry that is renowned for denying healthcare services to people when they need it the most,” said Howard.
The VSEA learned about the threat to their retiree health benefits in September of 2022. They organized a massive resistance. By May of 2023 they had defeated Medicare Advantage. Howard tells the story at minute marker 30:40 on this radio program, To Heal D.C.
The New York City Organization of Public Service Retirees has been fighting for two years to keep from getting egg-whipped. They too are winning. It’s a David and Goliath story, and David and his slingshot, amazingly, are hanging in there, creating a spirited, fighting camaraderie as they do it.
Former New York City Mayor Bill de Blasio initiated the move to place the New York City retirees into a Medicare Advantage Egg-Whip. That effort was continued by current Mayor Eric Adams, who claims that the city would save $600 million a year and that the retirees would be better off than they are now with their current plan based on traditional Medicare.
Mayor Adams, sadly, in conjunction with some of the unions, signed a deal with Aetna to move the city retirees into an Egg-Whip MA Aetna plan, despite the fact that Aetna’s MA plans, in just one year, imposed prior authorization restrictions on nearly 3 million people and denied the claims of 400,000.
On August 11, 2023, Judge Lyle Frank granted the request of the retirees and ruled that the city could not place the 250,000 retirees into Medicare Advantage against their will.
“This is now the third time in the last two years that courts have had to step in and stop the city from violating retirees’ healthcare rights,” said Marianne Pizzitola, president of the New York City Organization of Public Service Retirees. “We once again call on the city and the Municipal Labor Committee to end their ruthless and unlawful campaign to deprive retired municipal workers of the healthcare benefits they earned.”
Retirees have waged battle through countless demonstrations and actions that have brought the grassroots into motion like never before. NYC retirees are currently urging the City Council to pass legislation that clearly makes permanent their right to their current health benefit plan. They have persuaded 17 council members to sign on to the legislation and are working to get that number to 34 to give them a veto-proof majority. Uphill battles don’t faze them. They continue with a feisty energy as Mayor Adams announces that he will once again appeal the judge’s decision.
A similar battle is unfolding in the state of Delaware. Since August of 2022, Retirees Investing in Social Equity (RISE Delaware) has been organizing to block a proposal to place them in a Medicare Advantage Egg-Whip plan run by Highmark. RISE Delaware, initiated by former State of Delaware Representative John Kowalko and New Castle County Councilwoman Lisa Diller, has generated thousands of emails and letters to officials and brought litigation that has succeeded, so far, in stopping the state from implementing the change to an Egg-Whip MA plan.
In an open letter from RISE Delaware, the organization responds to the barrage of false information. “The fact that we would not accept the move into Medicare Advantage and took the State of Delaware to court to stop it is an indication of how serious we are about keeping the benefits promised to us.”
They go on to state their solidarity with future retirees:
But we also want a commitment to current employees that healthcare benefits will be there for them too. We know that employees are often unaware of how much they will need their healthcare benefits as they age. We know that high deductible healthcare plans sound great when you don’t need them. But it is when you can’t outrun the health problems that you need those healthcare benefits. So, we are watching as you “survey” state employees about the “modernization” of their healthcare benefits. We know that benefits choice is often code for benefits reduction even if employees are not yet aware of that fact.
RISE Delaware retirees are contacting the members of a state benefits committee that advises the legislature asking committee members to vote “to put a stake through the heart of Medicare Advantage so it can never come back to haunt us. If they don’t, MA will be like a dormant venomous snake in winter—it will come back to strike in spring.”
Retiree organizations in Vermont, New York, and Delaware have put thousands into motion as they rip down the curtains that have hidden Medicare Advantage from the nation’s understanding and righteous anger. They are fighting back, clearing the fog, educating their colleagues and the public to the dangers of Egg-Whips and Medicare Advantage, winning battle after battle to the consternation of the Medicare Advantage companies whose cash cow is suddenly exposed and threatened.