Cuomo Proposes Medicaid Cuts, Delays in Social Work, Health Home Initiatives, Rate Hikes

NYAPRS Note: Governor Cuomo released 30-day amendments to his 2013-4 budget proposal that cuts $500 million from the state Medicaid program to address the loss of federal Medicaid revenue as a result of required modifications in how the state finances services for people with developmental disabilities.

These include delays in the state’s recently proposed health home infrastructure initiatives, which are being clarified as being “used to develop enhanced systems to support Health Home operations including assignments, workflow, and transmission of data.”

The cuts will include:

  • “$180 million from accelerating Medicaid Redesign Team initiatives and delaying investments,
  • leveraging $200 million in current-year under spending to generate 2013-14 savings, and
  • $120 million from a 6 percent reduction to OPWDD Medicaid rates for not-for-profit providers.” Budget documents say that “this amendment effectively rescinds the 6 percent in rate increases/healthcare enhancements OPWDD providers have received since 2008-09.”

The Governor proposes a Mental Hygiene Stabilization Fund to “authorize the actions necessary to manage the loss of Federal revenue associated with recent actions by the United State Center for Medicare and Medicaid Services impacting the stability of New York State’s mental hygiene system.” His budget amendments:

  • Add language to allow the Commissioner of Health, in consultation with the Director of the Budget, to annul implementation of two percent across the board Medicaid reimbursement reductions.
  • Add language to delay investments authorized in Part A of the Bill relating to allowing certified social workers to bill Medicaid, establishing health home infrastructure governance support grants, and rate increases for Article 28, 31 and 32 integration.”

The Governor’s documents include the following: “Recent actions by the United States Center for Medicare and Medicaid Services impact the stability of New York state's mental hygiene system. While the state must embark on a deliberate path to replace the existing, long-standing financing system for developmental disability services, replacement of the sudden loss of $1.1 billion in federal revenue is too significant to be solved solely by actions within the mental hygiene system. A partner-ship with the entire health care community is needed to manage this loss over time. Accordingly, this part authorizes the actions necessary and creates the Mental Hygiene Stabilization Fund that will be supported by department of health medicaid resources under the Global Cap in annual amounts not to exceed $730,000,000 in state fiscal year 2013-14, $445,000,000 in 2014-15, $267,000,000 in 2015-16, and $267,000,000 in 2016-17.”

See for more details.

The Governor reiterated that he views state OPWDD refinancing as separate and apart from New York’s $10 billion waiver request to boost service improvement and cost reductions over the next 5 years, a proposal strongly backed by NYAPRS and many state advocacy groups.

$500M goes from Medicaid plan

"Shortfall" Is Created By Reduced Federal Reimbursement Rates

ByJames M. Odato Albany Times Union February 20, 2013

ALBANY - Gov.Andrew Cuomocontinues plans to fund a $56 billion Medicaid program next year, but with $500 million less than projected in his Januarybudget.

Cuomo said Wednesday that he will unveil budget amendments on Thursday that will deduct $120 million from services to developmentally disabled patients in state institutions. Another $380 million will go from other parts of the health care program for low-incomepeople.

The governor did not say if hospitals and nursing homes will receive lower reimbursements or if spending on housing, facilities improvements or other investments will bedelayed.

The $500 million "shortfall" is the result of reduced reimbursement rates from the federal government, Cuomosaid.

It will resolve a problem involving the federal government's concern that New York collected $15 billion too much during the past two decades for developmentally disabled patients. No information was released about how the state will deal with paying back the federal government in the continuingdispute.

Federal officials plan to audit one year of reimbursement in the program to capture a "look back" payment. State officials have suggested any claim would be fought, perhaps in the courts, because federal health officials approved past rates andpayments.

The dispute simmers as the state seeks a $10 billion credit, or waiver, from Washington for the Cuomo administration's tightening of New York's sprawling health careprogram.

Individuals familiar with the administration's petition for the credit say federal officials have wanted the overbilling issue to be cleared before any agreement on extra funds for Medicaid reforms initiated since Cuomo tookoffice.

"The waiver is a separate issue, apples and oranges," Cuomo saidWednesday.

He said the Medicaid waiver appeal is pending while the reimbursement discussion takes placeseparately.

"The $15 billion is a discrepancy; they have a position, we have a position," the governorsaid.

Cuomo did not discuss last week'sHouse of Representatives Committee on Oversightand Government Reform's report of New York's Medicaid program. As part of the report, titled "Billions of Federal Tax Dollars Misspent on New York's Medicaid Program," the committee called for an independent audit of the program and of itsOffice of Medicaid Inspector General.

Such an audit would be an enormous assignment, and several people in the health care industry expect it would be nearlyimpossible.