#yoinks

I Love You, Charlene — The Local Honeys

-🥤

NOO!

Declaring the fund “insolvent,” Lander’s auditors determined that the Health Insurance Stabilization Fund owes the city $3.1 billion, not counting obligations that have yet to be tallied for fiscal years 2024 and 2025. [...] Established in the mid-1980s, the unions and City Hall created the Health Insurance Stabilization Fund to help cover the cost of adding a new health plan, GHI, for city employees in addition to longstanding HIP coverage. The idea was for the fund to pay for the difference in costs between the two, depending on their premiums.  A 1995 agreement specified that the fund should only be used for that purpose, known as equalization, and also said that in the event the fund ran dry, the Municipal Labor Committee “must reduce benefits and/or impose employee/retiree payroll deductions to satisfy the shortfall,” according to the audit. As the fund grew and health costs soared, the city Office of Labor Relations and the city’s unions began using the fund to pay for billions in supplemental benefits and for workers’ raises — deviating from the fund’s intended purpose of balancing premium rates and setting it on course to insolvency, the comptroller’s audit found. The probe paints a picture of the city and the unions using the fund as a virtual piggy bank, authorizing $4.3 billion from 2001 to 2024 in lump sum payments to the city and to union-administered general welfare funds, including $1 billion to cover the costs of raises, deferred layoffs and other benefits. A turning point, the financial analysis suggests, was a 2014 Healthcare Savings Agreement brokered by the administration of Mayor Bill de Blasio to settle union contracts that had expired under his predecessor, Michael Bloomberg. That deal reduced the city’s obligations to pay into the health fund as part of a health care cost savings scheme and ultimately shrunk the fund’s balance by $3.3 billion. Routine expenses for additional benefits including prescription drug, chemotherapy and weight loss programs also got charged to the fund, according to the audit.