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Medicare and contract law

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To the editor:

By law, contracts must contain 4 elements: 1) An offer of goods or services by one party. 2) Acceptance of that offer by a second party. 3) Consideration or value for the offer. 4) Mutual agreement whereby party one gives his/her goods or services in exchange for a set value provided by the second party. When all 4 elements are present, the contract is legally binding.

When one of the parties reneges on its commitments under the contract, it is called a breach.  That is exactly what the city is trying to do with its proposed Medicare Advantage switch for municipal retirees. The retired city workers fulfilled their contractual obligations. They gave their services for 20 years or more making them eligible for the agreed upon value, namely cost-free traditional Medicare plus SeniorCare past age 65 with Part B reimbursements. 

Neither the city nor the Municipal Labor Committee can retroactively change the terms because the contract is with the retirees who voted to approve their contracts and gave their services in exchange. 

I believe that this is why the city and MLC keep losing in court and will continue to do so. No individual, group, organization or government entity can retroactively re-write the consideration portion of a contract after they have received the benefit from it. That’s a breach and it is illegal.

Joseph Cannisi



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