Former New York City Comptroller Brad Lander has stated that the city’s Health Insurance Stabilization Fund is “not able to recover” as it faces significant financial issues. The fund currently owes $3.1 billion to outside vendors and the city, and this amount may be higher since expenses for the years 2024 and 2025 have not yet been accounted for, according to Lander’s audit from December 30.
Established in 1985 to assist employees with the costs of the Group Health Insurance (GHI) plan, the fund has since been used for various purposes, which Lander claims is illegal. Labor unions have argued that the fund can be used for any agreed-upon purpose through collective bargaining. Since 2001, unions have utilized $4.3 billion for pay raises and additional benefits, including $1 billion in 2014 for wage increases.
In 2024, the fund spent $166 million on various benefits, including Weight Watchers and Teladoc appointments, but a large portion was allocated to the city’s health programs. Lander’s audit suggests the unions have been aware of the fund's insolvency since 2018, as its cash balance has dropped from $1.1 billion in 2019 to only $3 million in 2024, accounting for unpaid healthcare costs. The fund’s shortfall is projected to have cost the city about $612 million in fiscal year 2025.
The GHI plan has recently transitioned to new management, and the new Comptroller, Mark Levine, has pledged to review Lander’s audit. Mayor Zohran Mamdani indicated that he takes these findings seriously.
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