By: Anson Claypool
The wrangling continues over who will pick up the high cost of Medicaid continues, with Governor Andrew Cuomo trying to shift more of the burden to New York City.
When Cuomo outlined the FY 2021 Executive Budget, it included provisions to reform the current Medicaid system with a new Medicaid Redesign Team co-chaired by Michael Dowling of Northwell Health and labor leader Dennis Rivera. The MRT II will work to reform the program and identify $2.5 billion in savings this year by finding industry efficiencies or additional industry revenue with zero impact to beneficiaries.
The state government’s view of who should pick up how much of the tab has met stiff opposition from New York City Mayor Bill de Blasio, who projected that the proposal could force New York City to spend an estimated $1.1 billion. A spokesman for the state told Crain’s New York Business, however, that under the plan New York City would only pay approximately $221 million in the case of overruns at a 2% property tax cap.
In 2011, Governor Cuomo created the Medicaid Redesign Team–or MRT–after unsustainable Medicaid spending contributed to a $10 billion budget deficit. The MRT developed a series of recommendations to immediately lower costs and revamp and improve the program. Today, 95 percent of New Yorkers now have health insurance and 6 million New Yorkers are covered under Medicaid.
“Although the State shoulders more than the $20 billion cost of Medicaid, local governments are responsible for determining eligibility and administering certain programs,” Cuomo noted. “Because local governments are no longer responsible for the cost of their programs, there is no financial incentive to control costs and localities have failed to adequately monitor their programs, leading to overspending. Other factors, such as the cost of managed long term care, the $15 minimum wage, increasing enrollment and support to distressed hospitals, have also contributed to the increasing costs of the Medicaid program.”
The MRT II will work to find industry efficiencies or additional industry revenue with zero impact to beneficiaries and report its findings in time for the April 1st budget deadline, the governor’s office confirmed. Additionally, the Governor will empower the Medicaid Inspector General to root out waste, fraud and abuse in the Medicaid system.
The state will commit to paying the entire increase in Medicaid costs for local governments as long as the local governments stay within the 2 percent property tax cap and control Medicaid costs to 3 percent growth per year–Medicaid growth for 2021 is projected to be 3.0 percent, allowing localities to increase without cutting State funding. Any local government that does not stay within those limits will be required to pay the total spending growth.
