Med­i­caid on chop­ping block

New York gover­nor pro­poses large cuts to help erase bud­get deficit

Modern Healthcare - - The Week In Healthcare - Melanie Evans

New York’s gover­nor pro­posed a $2.85 bil­lion cut to state spend­ing on Med­i­caid in the com­ing year as the state scram­bles to close a $10 bil­lion gap in the next seven weeks. fed­eral funds. Med­i­caid is jointly fi­nanced by the states and fed­eral govern­ment.

The New York State Nurses As­so­ci­a­tion ar­gued the size and scope of pro­posed cuts raise con­cerns that ad­e­quate nurse staffing muster” to pro­pose ideas that curb spend­ing with­out com­pro­mis­ing care. “It is a daunt­ing chal­lenge,” he said.

Fed­eral fund­ing to New York for Med­i­caid will plunge by $5 bil­lion next year as re­ces­sion re­lief to states, en­acted by Congress in early 2009, comes to an end.

“One of the main driv­ers in this bud­get is that New York got about $6 bil­lion in fed­eral funds last year, in terms of stim­u­lus, and we in­haled it, and we in­jected it into our body and it is now gone,” Cuomo said. “And we have a with­drawal from the fed­eral stim­u­lus money.”

In June, bil­lions of dol­lars in fed­eral Med­i­caid re­lief is sched­uled to end.

The Cen­ter on Bud­get and Pol­icy Pri­or­i­ties, in a re­cent sur­vey of state agen­cies, leg­is­la­tures and gov­er­nors’ of­fices, said 44 states and the District of Columbia face a com­bined $125 bil­lion bud­get deficit for the com­ing year. States re­lied heav­ily on ex­tra fed­eral Med­i­caid fund­ing to help plug deficits since the re­ces­sion be­gan, the re­port said. The boost in fed­eral Med­i­caid spend­ing and other state aid ac­counted for most of the $135 bil­lion to $140 bil­lion that flowed to states un­der the Amer­i­can Re­cov­ery and Rein­vest­ment Act of 2009.

New York’s state Med­i­caid spend­ing is pro­jected to in­crease to $18 bil­lion from $14.4 bil­lion un­der Cuomo’s bud­get. The gover­nor ar­gued man­dated rates and for­mu­las call for in­creased Med­i­caid spend­ing of roughly 13%, which he de­scribed as un­sus­tain­able.

“Noth­ing, my friends, is in­creas­ing by this amount,” he said of re­cent years’ Med­i­caid in­creases. “Not home val­ues. Not salaries. Not in­fla­tion. No in­come. Not any­thing.” For­mu­las also fail to tie pay­ment to per­for­mance, he said. “Growth in Med­i­caid will be re­cal­i­brated to a fair and ob­jec­tive stan­dard,” he said.

Kath­leen Shure, se­nior vice pres­i­dent of man­aged care and in­surance ex­pan­sion for the GNYHA, said statu­tory in­creases to provider Med­i­caid pay ac­count for a small share of the 13% in­crease iden­ti­fied by the gover­nor. She noted the 1.5% in­fla­tion ad­just­ment to provider re­im­burse­ment un­der New York law has been frozen in the prior three years.

New York Gov. An­drew Cuomo delivers his bud­get pro­posal Feb. 1. His bud­get in­cludes a $2.85 bil­lion cut to state spend­ing on Med­i­caid.

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