ECTOR COUNTY -- The legal battle between the Medical Center Hospital district and its retirees is now officially over.
After more than 24 years, MCH leaders decided to remove retirees from its healthcare insurance plan as part of a cost-cutting move. According to MCH CEO Bill Webster, the cut would result in a savings of $3.9 million for the hospital.
“We decided to put the retirees into a health reimbursement arrangement that would basically take more of the financial risk off of Medical Center and put it onto another insurance or third party,” Webster said.
Several retirees were outraged with the board’s decision which resulted in 317 retirees filing a lawsuit to keep the health insurance.
But Ector County District Judge Cecil Puryear decided on Wednesday to rule in favor of the defendants which included Webster and the district’s seven board members. The judge said the retirees did not provide sufficient evidence to prove there was a valid contract that guaranteed healthcare benefits for life.
“It basically reaffirms our decision in the first place that there was not a contract,” Webster said.
Although the 380 retirees currently on the plan and the 88 active employees who would have been eligible will no longer receive the hospital’s insurance, Webster says they’re providing funding for their insurance purchases into the HRA.
For example, any retiree under the age of 65 will receive $12,000 in a HRA that allows them to purchase an insurance policy. For retirees over the age of 65 who are eligible for Medicare, MCH funded an HRA in the amount of $1,020 to assist them with prescription drug coverage. Also, $3,600 was funded to those who qualify for only Medicare Part A.
“Those that are Medicare eligible, it’s actually better that they have a Medicare supplement plan because they don’t have the co-pays and deductible issues to deal with,” Webster said.
The retirees could appeal the judge’s decision, but for now some retirees are placing their hope in restoring their benefits if new hospital board members are elected on May 6th.