The SJC Affirms Discretion for Municipalities Regarding Retirees’ Enrollment in Health Insurance Outside of the Deferral Period

In Cannata v. Town of Mashpee, decided by the Supreme Judicial Court on June 18, the appellant was a firefighter who had worked for the Town for just under ten years before leaving his position and deferring retirement. When, years later, he began receiving retirement benefits, he attempted to enroll in the Town’s health insurance plan. The Town denied his enrollment on the basis that it had an “established practice” of denying enrollment to deferred retirees who had worked for the Town for fewer than ten years. The SJC found that, under G.L. c. 32B, § 9, a deferred retiree who did not continue his enrollment from the time of deferment is eligible to enroll in municipal insurance after retirement only at the option of the Town. Therefore, the Court upheld the Town’s decision.  

Cannata also argued that the Town was required to enroll him because it did not have a written policy of denying enrollment to deferred retirees with fewer than ten years of service with the Town. The Court rejected this argument and found that to establish an entitlement to enroll based on local policy, a plaintiff must “allege facts plausibly suggesting the existence of a policy permitting enrollment by a retiree following a deferred retirement during which the retiree was not enrolled.”  

While this case demonstrates that the burden lies with employees to demonstrate a policy of permitting enrollment, it would be prudent for municipalities to adopt policies setting forth eligibility requirements to ensure consistent decision-making.