The budget crisis in New York’s Medicaid program stems from the failure of a key cost-control measure adopted during Governor Cuomo’s first term. In 2011, Cuomo and the Legislature imposed a “global cap” on state Medicaid spending that was tied to the medical inflation rate. The measure showed signs of working at first, but lost its effectiveness as circumstances changed, loopholes multiplied and compliance faltered.
Federal officials are reviewing the state's expropriation of $2 billion from the sale of Fidelis Care health plan, potentially throwing a wrench into the Cuomo administration's plans for using the money.
A little-discussed hazard of creating a state-run single-payer health plan in New York would be its vulnerability to the business cycle. It would depend heavily on taxes collected from high-income New Yorkers, a source of revenue that's especially prone to booms and busts. A recession – or a downturn in the stock market – could easily open a budget hole not just in the billions of dollars, but in the tens of billions of dollars.
Sen. Chuck Schumer raised the alarm Tuesday about a pending reduction in Medicaid funding for safety-net hospitals, which he said would have "devastating" effect in New York. His warning was misleading in several ways, not least because it left out an important bit of context: Schumer himself voted for the cuts he was deploring. In effect, he was taking credit for trying to clean up a mess he had helped to create.
Is the Cuomo administration disclosing its payouts from the $2 billion Health Care Transformation Fund as required law? You be the judge.
The newly posted July cash report from the comptroller's office shows that state-funded Medicaid expenditures ran over budget projections by $665 million, or almost 8 percent, through the first four months of the fiscal year. If that pattern continues, the full-year overage would approach $2 billion.
New York's employer-sponsored health insurance premiums – which were already among the steepest in the mainland United States – rose faster than the national average in 2018, pushing the state's affordability gap to new heights.
Another hurdle is whether the new program can live up to the idea of universal health care, said Bill Hammond, a health-care analyst at the Empire Center, a conservative-leaning New York think tank. New Yorkers already had universal access, he said; the problem is how it is used. Health officials are rightly “trying to fix the delivery system,” said Mr. Hammond; meanwhile, the mayor, “made it sound like they’re fixing the coverage system.”