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Tensions Rise At Hearing On Proposed NY Medicaid Cuts

New York state Capitol
Jim Levulis

A lack of information on how Democratic Governor Andrew Cuomo plans to cut $2.5 billion out of New York state-funded health care programs led to some tense moments at a legislative budget hearing Wednesday.

Cuomo, in his budget address, said he’ll convene a commission to decide how to cut $2.5 billion in Medicaid spending to help close a $6 billion gap, without harming recipients.  

“It will have zero impact on beneficiaries,” Cuomo said on January 21.   

But that commission, known as the Medicaid Redesign Team, won’t report back until sometime in March, potentially just weeks or even days before the state budget is due, leaving the legislature little time to analyze the proposals.    

Senator Jim Seward, a Republican from Oneonta and the ranking minority member of the Senate Finance Committee, says he’s concerned about the lack of timely information to lawmakers, and whether those affected by the cuts will have a chance to speak out.  

“There’s an extremely limited time frame involved here,” Seward said. "And a huge job, responsbility and challenge." 

Lawmakers also complained they weren’t notified about just how much the Medicaid budget has ballooned recently. The state health department stopped posting on its website last March the monthly reports on Medicaid spending, and did not post them for the next nine months. During that time, Cuomo’s budget officials delayed a $1.7 billion payment to providers, so that the spending was not counted in the last fiscal year, but instead was credited to the current fiscal year. It was an effort to, on paper, stay within a self-imposed spending cap.  

State Medicaid Director Donna Frescatore told a skeptical Assembly Health Committee Chair Richard Gottfried, a Manhattan Democrat, that in the future the department would be more transparent. 

“It’s our intent, going forward, to generate those reports on a monthly basis,” said Frescatore.  

"Unfortunately for the health department to say something is public data, doesn’t mean I can see it,” said Gottfried, who admonished the department for its track record of delaying answers to Freedom of Information Law requests. Frescatore assured the assemblyman that the information would in the future be posted on the department’s website.  

Just before the hearing, the health department posted on its website the monthly Medicaid spending numbers from last April through December 2019. 

The Chair of the Senate Health Committee, Gustavo Rivera, a Bronx Democrat, told Frescatore and Health Commissioner Howard Zucker that the lack of detail is “unacceptable.”  

“We don’t trust you, you’ve got to build that,” Rivera admonished. “This ain’t helping.”   

Rivera says he’s skeptical that the cuts can be achieved without harming patients.

The governor also proposed a plan that would alter the terms of a 2013 cap that the state placed on the growth of Medicaid costs for the state’s counties. That agreement allowed county spending to remain flat, while the state paid for any increases in spending from year to year. Now, Cuomo says if counties and New York City, increase spending on Medicaid more than 2% from the previous year, the state will no longer foot the bill. He says counties have not been responsible in their spending. 

“That’s the blank check syndrome,” the governor said. “We are signing the check and they’re filling out the amount.”  

New York City’s Office of Management and Budget estimates that could cost the city over a billion dollars next year. Local governments have said it’s the state that makes most of the decisions of how the Medicaid dollars are spent.

Several lawmakers called the governor’s proposal a blatant “cost shift” to local governments. Assemblyman Phil Palmesano, a Republican from Corning, says Cuomo should just admit that property owners will pay more in taxes under the plan. 

“It’s completely disingenuous and an insult and false for him to say counties have absolutely any say or control in the cost or growth in the Medicaid program,” Palmesano said.  

The budget is due April 1.

Karen DeWitt is Capitol Bureau chief for New York State Public Radio, a network of public radio stations in New York state. She has covered state government and politics for the network since 1990.
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