Village Tussles with Former Chief Over $70,000 Misunderstanding

Posted on 05 January 2011

Sag Harbor Village
Trustees Drop Former Police Chief from Insurance

By Kathryn G. Menu

Former Sag Harbor Village Police Chief Joseph Ialacci was dropped from the Village of Sag Harbor’s health plan last week after village officials said he racked up over $70,000 in health care bills using village insurance over the last four years when he should have been using his Medicare coverage.

During a special Sag Harbor Village Board of Trustees meeting on Thursday, December 30, the board voted to drop Ialacci and his wife from village insurance after they said Ialacci had yet to repay the village through Medicare reimbursement for those false charges.

According to a letter from Island Group Administration, the East Hampton company that handles the village’s insurance policies, in August 2010 it was discovered Ialacci’s insurance claims should have been paid by Medicare, and charges he “purposefully” withheld his Medicare eligibility during a routine enrollment update in 2006.

According to Sag Harbor Mayor Brian Gilbride, since August the village has been working with Ialacci to recover over $70,000 through Medicare, as well as $6,700 not eligible for reimbursement, that would have to be repaid to the village out of pocket.

Gilbride said, Ialacci had informed him when he went to the doctor he tried to use his Medicare card, but it was not activated so he used his village insurance instead.

While Ialacci agreed to pay the village back, Gilbride said the village has yet to see a dime.

Ialacci, who resides in Florida now, asked all inquiries into the matter be made to his attorney, John Bracken of Bracken & Margolin.

According to Bracken, the situation was simply the result of Ialacci not understanding he needed to switch to Medicare as his primary insurance with his contractually obligated village insurance acting as a supplemental plan.

“When he got this claim, he was floored,” said Bracken, noting there would be no financial benefit for Ialacci to use his village insurance over Medicare.
“It is not like he was pocketing the money or defrauding someone,” said Bracken. “He just didn’t know.”

Bracken said he was working with the Social Security Administration as well as two hospitals and doctors on getting the village reimbursed through Island Group, but added it can be a time consuming process.

“The bottom line is he is doing the right thing,” said Bracken. “We have gone back to Medicare to get this straightened out and we have cooperation, but it is not an overnight process.”

He added, the process, called “a coordination of benefits” will be done between Medicare and Island Group, with not a dime passing through Ialacci.

“There is no money going into his hands, nor has there ever,” said Bracken who added that he believes the $6,700 not reimbursable under Medicare should have been covered by the village as Ialacci’s supplemental insurance carrier.

He added, after reviewing Ialacci’s contract with the village, that the paragraph guaranteeing the former police chief lifetime coverage through the village is crystal clear and makes no mention of a requirement to switch to Medicare, a standard practice in these types of contracts, said Bracken.

“Cancellation of this policy is unequivocally against the law and his contract, which he retired pursuant to,” said Bracken. “We will ask that it be reinstated immediately or we will bring an action in federal court. They have really jumped the gun here.”

Gilbride said “the bottom line” is that the village tried to work with Ialacci, even to develop a payment schedule for the $6,700 they believe he will have to pay out of pocket, but have been unable to get cooperation.

“They agreed to do it, but never did,” said Gilbride. “My obligation is to village taxpayers, and we have to get paid back for this.”

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2 Responses to “Village Tussles with Former Chief Over $70,000 Misunderstanding”

  1. robertpedrosa says:

    Search on the web “Wise Health Insurance” if you have a condition such as high blood pressure, asthma, diabetes, cancer, depression or have had an injury, like a broken leg and need health Insurance NOW.

  2. Ruledbyfools says:

    The classic wolf in sheeps clothing story. Another embarassment to our leadership and the public trust. Ialacci should run for higher office I’m sure plenty of idiots would vote for him.


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