
On August 20, the New York State Legislature and Governor Paterson reached a budget agreement less than 24 hours after the Special Legislative Session began. The Legislature rejected health care cuts Governor Paterson requested last week that GNYHA estimated would have cost the hospital and nursing home sectors $1 billion each.
Nevertheless, the Legislature did respond to the Governor’s call by restraining growth in Medicaid provider rates. The State Division of the Budget (DOB) estimates that these actions will save the State a total of $170 million over SFYs 2008-2010.
Using DOB estimates, GNYHA estimates the impact on fee-for-service hospital spending, including the Federal share, will be approximately $107 million through the next State fiscal year. Medicaid managed care payments, for hospital contracts that are tied to Medicaid fee-for-service rates, will be similarly affected, for an overall impact closer to $200 million.
In response to the budget agreement, the GNYHA/1199 SEIU Healthcare Education Project released this statement
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Although by working with the Legislature, GNYHA and our colleagues at HANYS were able to contain most of the damage, the final budget agreement contains real reductions in Medicaid spending for providers at a time when the costs of doing business are increasing. To head off devastating cuts in next year's budget, GNYHA, working with 1199 SEIU and its national partner, Service Employees International Union (SEIU), will continue to lobby Congress to pass a national economic stimulus package, which proposes to deliver $1.8 billion over five quarters in increased Medicaid matching funds for New York State.
For more details about the budget agreement, read ML-93
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