NYAPRS Note: While much more detail is needed to understand the full nature and impact of Medicaid deficit reductions plans announced yesterday by Governor Cuomo, here’s what we’ve gleaned so far.
First off: in a major reversal, Budget Director Robert Mujica announced that while DOB had previously announced plans to defer $2.2 billion in Medicaid payments in its mid-year update, that’s not going to occur. It is also rolling $1.7 billion that was deferred at the end of the last fiscal year back into the fiscal year 2019 budget, he said. “It’s the fiscally responsible thing to do and we’re going to acknowledge what happened at the end of 2019 and solve structurally going forward,” he said. (https://www.politico.com/states/new-york/albany/story/2020/01/21/cuomo-hinges-gap-closing-plan-on-past-maneuvers-1253196?utm_source=newsletter&utm_medium=email&utm_campaign=Timesunion_Capcon&stn=nf). This will put even more pressure on efforts to address past and current Medicaid gaps.
Some Details of the Governor’s Proposal to Address the Medicaid Deficit
Tighter County Management, Access to Services
This year’s proposal would reward counties that hold Medicaid cost increases to 3% or less, or effectively punish counties that overshoot that benchmark, saying that the state would no longer cover costs over budget by 3%. As an example of the impact of this measure, New York City’s Medicaid growth rate came in at about 7% last year and, in the new scenario, could had led to a $646 billion give back.
Given that a primary role for the counties in Medicaid is acting as a gatekeeper to who gets access to Medicaid programs and, in particular, long term care programs like home health care, we might expect local efforts to tighten access to essential programs of this nature.
Accordingly, protecting consumer access and choice will be an especially major focus
of NYAPRS’ advocacy this year.
New Recommendation from Medicaid Redesign Team: The Governor is bringing back the Medicaid Redesign Team, a broad group of stakeholders who helped to identify about $19 billion in savings in during 2013-18. As of now, the 2020 MRT must report back before the April 1 deadline to enact a Budget with a plan to deliver $2.5 billion in recurring savings.
The Governor has indicated that he is directing the MRT to develop a plan that doesn’t rely on local governments as a funding sources and has minimal impact on beneficiaries, a mighty feat. An advocate for the state’s nursing homes worried that if cost cutting leaves out the counties and beneficiaries than cuts to providers might well be on the way. No news about that nor a mention of across the board Medicaid cuts that were rumored late last year. Hard-pressed community human service organizations can in now way survive such cuts….in fact, we’re mounting a full throated campaign to win a 3% sustainability fund increase for each of the next 5 years.
Further, MRT II must once again find solutions “through industry efficiencies and/or by relying on new resources provided by the industry itself. They must also root out waste, fraud and abuse.”
Higher Health Insurance Taxes
Mujica also said that the MRT could recommend higher health insurance taxes, a move opposed by the health plans. “Given the important role that plans have played in the state’s health-reform efforts, it is vital that our industry be part of any discussion,” said Eric Linzer, president and CEO of the state Health Plan Association.
Other State Actions
“The Department of Health and Office of the Medicaid Inspector General will collaborate to explore opportunities to improve program efficiency and take advantage of new data tools to further inform Medicaid policies and procedures and recover improper payments.”
The state also pointed to hoped for federal approval of another $8 billion round of our DSRIP waiver.
Another Deferred COLA
Once again, the Governor is proposing yet another deferral on a long promised across the board Cost of Living Adjustment. Accordingly, NYAPRS has joined 40 other associations and organizations calling on state government to implement a 3% sustainability fund for each of the next 5 years for hard-pressed, dedicated human service organizations
General Reactions
Not surprisingly the counties were very cautious in their response, Assembly Speaker Carl Heastie was concerned but glad there was no upfront cuts to the counties, the MRT plan was greeted favorably by the downstate hospitals and their workers while conservative watchdogs warned that the factors leading to the Medicaid overspending are not really the fault of local governments and that it was unlikely that the State Legislature would agree to penalize local governments if they don’t hold down costs.
Our friends and partners at the Consumer Directed Personal Assistance Association will launching another determined campaign to push back on a 2nd year of pressure to cut the highly vaunted program: “The second Medicaid Redesign Team must look at smart spending cuts we’ve identified while preserving services for thousands of New Yorkers and be comprised of seniors and people with disabilities who most rely on them,” CDPA’s executive director, Bryan O’Malley, said in a statement.
More details coming…..