UPDATE: The Governor’s Office has released additional details on how this week’s sudden cuts to funding from the federal government will affect New York’s agencies, including the services which are at risk. Read below for the additional information.
Alliance Alert: New York is already beginning to feel the burden of massive federal cuts. This week, state agencies and service providers were blindsided by the sudden termination of over $300 million in federal funding meant to support mental health, substance use, and public health services.
This includes cuts to programs operated by the Office of Mental Health (OMH), Office of Addiction Services and Supports (OASAS), and the State Department of Health (DOH)—funding that communities across New York were counting on to fight the overdose crisis, respond to mental health needs, and maintain essential services for our most vulnerable residents.
What makes this more devastating is that these cuts were unexpected and immediate. Providers had built budgets and hired staff based on this funding. Now, they are being told that expenses incurred after March 24 will not be reimbursed, threatening service disruptions, layoffs, and irreparable harm to people in recovery and those in crisis.
Federal Cuts by the Numbers:
Department of Health
DOH expects to lose over $300 million in funding for organizations across the State.
- This funding supports many activities that are core to public health functioning, including virus surveillance, outbreak response, electronic data exchange, public dashboards, infection prevention activities in hospitals and nursing homes, laboratory reporting, program operations, and support to local health departments. The backbone of the State’s public health infrastructure will be weakened significantly due to reduced virus surveillance and reporting systems that can no longer provide communities and families with real-time information on developing outbreaks, laboratory support and testing, data collection and analysis, public-facing dashboards, data and analytics.
- Losing this funding will shutter multiple areas of work that are largely seen as foundational components of the Department’s response to emerging infectious diseases. These cuts will also eliminate the Centers for Disease Control (CDC) and Prevention’s COVID-19 Health Disparities Grant, which funded 135 subcontractors to support community-based work addressing health disparities in New York, such as mental health, maternal and infant health, and food security.
Office of Addiction Services and Supports
OASAS expects to lose $40 million total in funding, which will result in significant cuts to addiction and prevention services, treatment supports and access to resources for individuals struggling with substance use. This work includes, but is not limited to:
- Transitional housing to help provide short-term housing and case management for individuals leaving OASAS residential treatment or correctional facilities who cannot otherwise access permanent housing.
- Support for programs, access to treatment, recovery, and other basic services that keep people connected to care in their communities.
- Expansion of outpatient clinics to offer medication for addiction treatment and to purchase and outfit mobile medication units to bring services where they are needed.
- Administering and implementing Screening, Brief Intervention, and Referral to Treatment (SBIRT) which is a comprehensive public health approach to identify those at risk of developing substance use disorders and deliver early intervention and treatment services to individuals who exhibit habits of risky use of alcohol and other substances.
Office of Mental Health
OMH expects to lose $27 million total in funding for programs and services for individuals experiencing mental health and/or substance use needs. These programs were intended to allow individuals in need of care to remain in their homes, connected to their natural support systems during treatment. The loss of this funding will result in an increased reliance on emergency services and hospital-based care with fewer community resources and supports for our most vulnerable New Yorkers, including:
- Crisis Stabilization and Crisis Residence Programs to provide urgent treatment to individuals experiencing an acute mental health and/or substance use crisis, and a safe place for the stabilization of psychiatric symptoms and support for children and adults.
- Adult Assertive Community Treatment Teams (ACT) serving individuals with serious mental illness who are in danger of losing their housing/becoming homeless, are homeless, and/or have histories of involvement with the criminal justice system, and Children and Youth Assertive Community Treatment Teams (ACT) for youth who are returning home from inpatient settings or residential services, at risk of entering such settings, or have not adequately engaged or responded to treatment in more traditional community-based services.
- Grants to expand and improve upon the mobile crisis services statewide, including 9-8-8 crisis call centers. These call centers have relied on this funding to ensure they have capacity to connect callers experiencing emotional distress to the compassionate care of trained counselors.
State lawmakers have begun to push back. Proposals to withhold federal tax payments and calls for legal action reflect just how serious this moment is. But while these battles play out, New York must do everything it can to protect the people who will suffer most from this reckless move by the federal government.
That means:
- Ensuring continuity of services through emergency state funding where needed.
- Refusing to let partisan federal politics dismantle public health and recovery systems that New Yorkers rely on.
- Prioritizing core health and safety services in budget negotiations and beyond.
Let’s be clear: these cuts are not just numbers—they represent lives. They will worsen the mental health crisis, deepen the overdose epidemic, and unravel progress we’ve fought to make in building up community-based services.
New York must step up to protect its people. That means standing up to these federal attacks and finding ways to safeguard the services that help New Yorkers survive and recover.
We will continue to monitor developments and share opportunities to advocate, act, and hold our leaders accountable. See below for more.
Statement From Governor Kathy Hochul on Sweeping Federal Cuts to Public Health, Mental Health, and Addiction Services
Office of NYS Governor Hochul | March 26, 2025
“Yesterday, the federal Department of Health and Human Services notified our Administration that they intend to cut more than $300 million in funding for the New York State Department of Health, Office of Addiction Supports and Services, and Office of Mental Health. These include funds that county health departments across New York are planning to use to fight disease and keep people safe. At a time when New York is facing an ongoing opioid epidemic, multiple confirmed cases of measles and an ongoing mental health crisis, these cuts will be devastating.
“Make no mistake: there is no State in this country that has the financial resources to backfill the massive federal funding cuts proposed by DOGE and Congressional Republicans. They are trying to rip apart the social safety net that lifts families out of poverty and gives everyone a shot at a middle-class life. These cuts aren’t just numbers on a page – they’re going to hurt real people in every corner of New York.
“For every attempt they make to withhold this funding, we will fight them tooth and nail. I’ll do everything in my power to protect the health and well-being of New Yorkers.”
| For Immediate Release: 3/28/2025 | GOVERNOR KATHY HOCHUL |
BY THE NUMBERS: GOVERNOR HOCHUL UPDATES NEW YORKERS ON THE DEVASTATING IMPACT OF FEDERAL CUTS ON NEW YORK STATE’S HEALTH AND HUMAN SERVICE PROGRAMS
Over $300 Million in Cuts to Department of Health Programs Across the State
for Vital Public Health Programming
$40 Million in Lost Funding for the Office of Addiction Services and Supports, Impacting Recovery Programs and Treatment for Individuals Struggling With Substance Abuse
$27 Million in Cuts to the Office of Mental Health’s Crucial Work in
Supporting New Yorkers With Mental Illness
Governor Kathy Hochul today shared a breakdown of the Trump administration’s sweeping federal cuts to New York State’s health programs, and how these cuts to health funding will affect New Yorkers. The amount of funding lost will have a devastating impact statewide on programs that ensure the safety and well-being of people in New York, gutting over $360 million in financial resources toward mental health and addiction services, and health departments across the State.
“Slashing funding for public health, suicide prevention and addiction services is just plain cruel, and it’s going to hurt everyday New Yorkers most,” Governor Hochul said. “Here’s the sad truth: there is no State in the nation that has the resources to backfill these sweeping cuts. It’s up to New York’s elected officials who serve in the House majority to stand up and fight back.”
New York State Department of Health Commissioner Dr. James McDonald said, “It is disappointing these grants were terminated so impulsively without any advance notice and without consideration for the people we serve. We were poorly prepared as a nation for the last pandemic. I see the same pattern occurring now, where decisions are made without consideration for the public’s health and well-being. These grants were preparing us to be healthier for the next pandemic. These investments allowed New York to develop strategies that prevent chronic disease, improve nutrition and find problems before they started.”
Office of Addiction Services and Supports Commissioner Dr. Chinazo Cunningham said, “These sweeping federal cuts to health and human services threaten critical addiction funding streams that support prevention, harm reduction, treatment, and recovery services, putting lives at risk and straining the providers working tirelessly on the frontlines of this public health crisis. OASAS remains committed to protecting and expanding access to life-saving services, and will work to mitigate the damage caused by these harmful cuts.”
Office of Mental Health Commissioner Dr. Ann Sullivan said, “For many years, the federal government has been a trusted and valued partner in efforts to provide critical mental health services and supports to New Yorkers, many living in traditionally marginalized communities and under difficult socioeconomic conditions. These drastic cuts will likely slow, and in some instances, halt the fantastic progress our federally funded programs have made and continue to make across our state. We have come too far to reverse course on mental health, which is why our federal legislators owe it to New York to challenge these cuts however possible.”
Federal Cuts by the Numbers:
Department of Health
DOH expects to lose over $300 million in funding for organizations across the State.
- This funding supports many activities that are core to public health functioning, including virus surveillance, outbreak response, electronic data exchange, public dashboards, infection prevention activities in hospitals and nursing homes, laboratory reporting, program operations, and support to local health departments. The backbone of the State’s public health infrastructure will be weakened significantly due to reduced virus surveillance and reporting systems that can no longer provide communities and families with real-time information on developing outbreaks, laboratory support and testing, data collection and analysis, public-facing dashboards, data and analytics.
- Losing this funding will shutter multiple areas of work that are largely seen as foundational components of the Department’s response to emerging infectious diseases. These cuts will also eliminate the Centers for Disease Control (CDC) and Prevention’s COVID-19 Health Disparities Grant, which funded 135 subcontractors to support community-based work addressing health disparities in New York, such as mental health, maternal and infant health, and food security.
Office of Addiction Services and Supports
OASAS expects to lose $40 million total in funding, which will result in significant cuts to addiction and prevention services, treatment supports and access to resources for individuals struggling with substance use. This work includes, but is not limited to:
- Transitional housing to help provide short-term housing and case management for individuals leaving OASAS residential treatment or correctional facilities who cannot otherwise access permanent housing.
- Support for programs, access to treatment, recovery, and other basic services that keep people connected to care in their communities.
- Expansion of outpatient clinics to offer medication for addiction treatment and to purchase and outfit mobile medication units to bring services where they are needed.
- Administering and implementing Screening, Brief Intervention, and Referral to Treatment (SBIRT) which is a comprehensive public health approach to identify those at risk of developing substance use disorders and deliver early intervention and treatment services to individuals who exhibit habits of risky use of alcohol and other substances.
Office of Mental Health
OMH expects to lose $27 million total in funding for programs and services for individuals experiencing mental health and/or substance use needs. These programs were intended to allow individuals in need of care to remain in their homes, connected to their natural support systems during treatment. The loss of this funding will result in an increased reliance on emergency services and hospital-based care with fewer community resources and supports for our most vulnerable New Yorkers, including:
- Crisis Stabilization and Crisis Residence Programs to provide urgent treatment to individuals experiencing an acute mental health and/or substance use crisis, and a safe place for the stabilization of psychiatric symptoms and support for children and adults.
- Adult Assertive Community Treatment Teams (ACT) serving individuals with serious mental illness who are in danger of losing their housing/becoming homeless, are homeless, and/or have histories of involvement with the criminal justice system, and Children and Youth Assertive Community Treatment Teams (ACT) for youth who are returning home from inpatient settings or residential services, at risk of entering such settings, or have not adequately engaged or responded to treatment in more traditional community-based services.
- Grants to expand and improve upon the mobile crisis services statewide, including 9-8-8 crisis call centers. These call centers have relied on this funding to ensure they have capacity to connect callers experiencing emotional distress to the compassionate care of trained counselors.
###
Feds Suddenly Terminate Funding for NY Addiction Recovery Programs
By Rebecca Lewis | City and State New York | Marh 26, 2025
Addiction recovery service providers were left in the lurch on Tuesday after two state agencies informed them that the federal government had terminated grant funding meant to last through September. Now, they’re asking the state to include funding in the state budget that will fill that gap, as New York suffers one of the first of what will likely be many potential cuts in federal funding.
Both the state Office of Mental Health and Office of Addiction Services and Support, known as OASAS, have had access to pots of money from the federal government to help respond to the COVID-19 pandemic. Those revenue streams were approved as part of the COVID Response and Relief American Rescue Plan Act of 2020 and the American Rescue Plan Act of 2021, with access to the dollars extended until September 2025 under the Biden administration. The feds provided the Office of Mental Health $129 million and OASAS $198 million to work with, when all the available grant allocations to agencies and partner providers were put together, according to advocates.
But on Monday, both state agencies received notice from the federal government that it had prematurely terminated access to those funds. In turn, the agencies alerted providers on Tuesday that they will not get reimbursed for any further spending. “New York State OMH cannot reimburse or recognize any expenses incurred after March 24, 2025, for these grants as a result of termination,” reads a letter sent to providers on Tuesday. OASAS held a virtual town hall with service providers on Tuesday as well. In presentation slides from that meeting shared with City & State, the agency blamed the federal Department of Government Efficiency for the cuts, which it called “unexpected and concerning,” and said its staff was looking at ways to “mitigate the damage caused by this action.”
Chris Assini, policy director for Friends of Recovery New York, called the virtual town hall “somber” and warned that the surprise termination of funds could cause devastating disruptions in the continuity of care for those recovering from addiction. He is bracing himself for even further cuts. “This is just the first step,” Assini said. “It is ultimately going to get worse.”
Addiction services organizations working with OASAS and the Office of Mental Health expected to rely on these federal grant dollars for several more months and had budgeted accordingly. The state had already begun taking steps to continue to fund services when the federal money ran out later this year, but the surprise early termination – which providers contend is illegal – has officials scrambling to figure out how to ensure that care doesn’t get disrupted. “You’re effectively cutting off six months of planning that agencies and providers have been doing right,” said Jihoon Kim, president and CEO of InUnity Alliance. “They have staff that literally are paid through those funds.”
With the situation very much in flux, advocates and lawmakers are calling on state leaders to include money in the budget to backfill the unexpected cuts, even as they take steps to fight the federal government’s abrupt termination of the grant funds. “In moments like this, we’re reminded that government has a responsibility to protect its people, not abandon them,” said state Sen. Nathalia Fernandez, chair of the state Senate Alcoholism and Substance Use Disorders Committee. “We will not stand by while vital services are ripped away from those who need them most.” She’s calling for at least 60 days of emergency funding, but neither lawmakers nor advocates have a specific dollar amount yet of necessary funds.
After this story was published, Gov. Kathy Hochul said in a statement that the federal government had cut a total of $300 million to OASAS, the Office of Mental Health and the state Department of Health. She condemned the move but gave no indication that she would support backfilling the grant funding with state money. “Make no mistake: there is no State in this country that has the financial resources to backfill the massive federal funding cuts proposed by DOGE and Congressional Republicans,” Hochul said. However, she said she would “fight them tooth and nail” over the funding.
State leaders have so far been cagey about including remedies to potential federal cuts in the budget, though the addiction services funding cut is not “potential” and the funds were previously appropriated before the sudden termination. Asked about the cuts on Wednesday, state Senate Majority Leader Andrea Stewart-Cousins said she had conversations about the federal move, but wouldn’t commit to the idea of addressing the cuts in the budget. “We have to look at the priorities, and we’ve got to figure out what’s the best use of the finite resources that we have,” Stewart-Cousins told reporters.
Spokespeople for Gov. Kathy Hochul and the Office of Mental Health referred back to comments the governor made to reporters about potential cuts last week. “I’ve said all along, I can’t fix what they’re doing to us,” the governor said at the time. “I don’t have the resources.” She added, however, that “when they withhold money, we see you in court.” A spokesperson for OASAS did not provide a comment before publication.
A spokesperson for Assembly Speaker Carl Heastie did not return a request for comment, but Heastie told reporters on Tuesday that he would not discuss backfilling potential federal cuts. “We’ve gotten nothing direct from the feds or the Republicans as to what they would cut,” he said – which is no longer true thanks to the grant funding termination.
While substance abuse disorder service providers are ringing the alarm bell first, the COVID-related grant funding termination could have far-reaching implications for other agencies and organizations around the state and country.
NBC News first reported on Tuesday that the U.S. Department of Health and Human Services had pulled back over $11 billion in COVID-related funding to state and community health departments.