Mayor Sounds Alarm Against GHI-HIP For-Profit Merger

By ARI PAUL

Mayor Bloomberg May 6 called on State Superintendent of Insurance Eric R. Dinallo to stop the conversation of the Health Insurance Plan of Greater New York (HIP) and Group Health Incorporated (GHI) into a single for-profit entity.

MAYOR BLOOMBERG: Merger bad for city, workers.

Calling it "bad policy," the Mayor's Office filed a memorandum in opposition to the conversion of the insurers, which provide health-care coverage for 93 percent of city employees.

'Could Increase Health Costs'

"GHI and HIP have each provided quality health insurance benefits to New Yorkers for more than 60 years," Mayor Bloomberg said in a statement last week. "The conversion to a single for-profit entity could increase health-care costs by hundreds of millions of dollars, and threatens the health and financial well-being of city workers and retirees. We don't need city dollars intended to protect hard-working city employees and retirees used instead to pad the compensation of health-care executives. This conversion should be rejected."

United Federation of Teachers President Randi Weingarten, who as chair of the Municipal Labor Committee leads the unions in bargaining on health benefits, had in 2006 supported a merger of the two insurers based on the assurance that there would be no negative impact on city workers.

The Coalition Against Privatization, which includes members from the UFT and Transport Workers Union Local 100, held a rally against the conversion May 9 outside Mr. Dinallo's lower Manhattan office. Coalition organizer Billy Wharton said that a for-profit entity would mean higher premiums for city workers.

"What we're trying to do is send a clear message in opposition to the conversion with no strings attached," he said. "I believe once GHI and HIP privatize, it's going to begin to act like every other private health carrier in the country."