health-ins-300x225-9563457Now that the state budget is put to bed for another year—and the public can finally see the details—here is a non-comprehensive rundown of health care-related highlights and lowlights.


Governor Cuomo’s proposed surcharge on prescription opioids was repackaged as an “assessment,” trimmed from $125 million to $100 million in revenue and altered to exempt certain uses, such as hospice care and addiction treatment. Despite the name change, it’s still a tax that’s likely to increase costs to New York consumer and taxpayersand it’s still not tied to any significant expansion of funding for rehab.

Under considerable arm-twisting from the governor, Fidelis Care and its would-be buyer, Centene, agreed to quasi-voluntarily pay the state $2 billion over the next four years, to be spent on health-related purposes at the governor’s discretion. (The many troubling features of this transaction are detailed here.)

A related plan that would have skimmed reserve funds from two Medicaid managed care plans—Fidelis and New York City-operated MetroPlus—was altered to exempt MetroPlus. The whole thing becomes moot if Fidelis’ sale to Centene goes through, as planned, before August 1.

A 14 percent tax on for-profit health insurers did not make the final budget, thus heading off a scenario in which plans could well have blamed this year’s premium hikes on the governor.


The state’s cap on Medicaid drug spending, initially approved for fiscal years 2018 and 2019, was extended through 2020. Senate Republicans added new reporting requirements for the Health Department, at least partially addressing the program’s lack of transparency.

Among the many other programs routinely extended were $125 million in excess medical malpractice coverage for doctors, which dysfunctionally subsidizes a broken tort system, and a “transition adjustment” in the state’s indigent care pool, which dysfunctionally shifts money to less needy hospitals.

New spending

The budget includes another $525 million in capital funding for health care facilitiesfor a total of $3.8 billion in such commitments since 2014. Lawmakers initially approved $475 million as part of the health and mental hygiene bill, then mysteriously added another $50 million in the revenue bill.

The program is specifically exempt from any requirement for competitive bidding or a request-for-proposals process, and the allowed purposes are broad enough to cover almost any project.

Medicaid hospice payments were increased by 10 percent as of April 1, and Medicaid pharmacy dispensing fees were bumped from $10 to $10.08 per prescription.

The budget calls for increased reimbursements to safety-net hospitals, but offers no detail about where the money should come from or how it should be distributed—and eligibility criteria are loose enough to cover a broad swath of institutions.

Mandate watch

State-regulated health plans must immediately start covering pasteurized donor human milk for newborns when ordered by “a licensed medical practitioner.” Last year’s budget included a similar provision for Medicaid. In neither case, was there a formal study of costs and benefits.


The budget enacts some of the reforms proposed by Cuomo’s Regulatory Modernization Initiative, including making it easier for primary care providers to offer mental health and drug-treatment services, and easing restrictions on telemedicine.

It also adds protections for sexual assault victims, including a ban on billing them for the cost of forensic medical exams, and a requirement that the evidence from those exams be preserved for at least 20 years.

In an attempt to boost nursing home quality, the budget orders a 2 percent cut in Medicaid fees for facilities whose federal Nursing Home Compare scores ranked in the bottom fifth the previous year and in the bottom two-fifths for two years in a row.

Cutting-room floor

Many of the governor’s health-related proposals did not make the final budget. Notable among them was his plan to authorize and regulate so-called retail health clinics in stores such as Walmart and CVS, which are an increasingly common and popular option for consumers.

Also killed was an attempt to abolish “spousal refusal,” a rule that enables New Yorkers in need of long-term care to qualify for Medicaid coverage, which is normally intended for the poor, without tapping the income and assets of their spouse. As noted by Politico’s Dan Goldberg, this is the 28th year in a row that governors have unsuccessfully tried to change that policy.

About the Author

Bill Hammond

As the Empire Center’s senior fellow for health policy, Bill Hammond tracks fast-moving developments in New York’s massive health care industry, with a focus on how decisions made in Albany and Washington affect the well-being of patients, providers, taxpayers and the state’s economy.

Read more by Bill Hammond

You may also like

New York State Has Dug Itself Into Its Deepest Hole On Record

"State's Financial Hole Deepens" is the headline on Comptroller Thomas DiNapoli's press release accompanying the August cash flow report. Read More

The CDC’s Nursing Home Death Count Is Even Less Complete Than New York’s

The result is that a major public health disaster affecting New York's nursing home residents is not being accurately documented by either of the agencies responsible for protecting them – because state officials are refusing to share the true numbers, and federal officials haven't yet asked for them. Read More

New Yorkers Paid Less in Federal Taxes in First Year of New Federal Tax Law

Federal income taxes paid by New Yorkers decreased by nearly $3.4 billion in 2018, the first year of the new federal Tax Cuts and Jobs Act (TCJA), according to newly released Internal Revenue Service data. Read More

The DOJ’s Probe of Coronavirus in Nursing Homes Appears to Leave Out Most Victims

The U.S. Justice Department's newly announced inquiry into coronavirus in New York's nursing homes comes with a crucial caveat: It will look only at government-operated facilities, which represent a small fraction of the state's nursing-home industry. Read More

State’s Per-Recipient Medicaid Spending Rises to 3rd Highest in the U.S.

New York's per-recipient Medicaid spending has soared to the nation's third highest rate, a sign of fiscal trouble for one of the state's most important programs. Read More

New York Medicaid Spending Is Projected to Jump 6% in Fiscal Year 2021 (UPDATED)

Despite a round of cost-cutting this spring, New York's Medicaid spending is on track to jump by 6 percent this year thanks to a massive influx of federal aid. Read More

New York’s Post-Pandemic State Budget Picture Is Looking Worse

Governor Cuomo continues to burn while pols in Washington fiddle around the issue of providing more aid to states and localities in yet another federal stimulus bill. Meanwhile, New York State's plummeting revenues still haven't hit their post-pandemic bottom, according to the First Quarterly Update to the state's FY 2021 Financial Plan. Read More

New York Has Widened Its Lead in Per-Capita Spending on Medicaid

New York's per-capita Medicaid spending soared to more than double the nationwide rate in 2018, widening its gap with the other 49 states. Read More


Sign up to receive updates about Empire Center research, news and events in your email.


Empire Center for Public Policy
30 South Pearl St.
Suite 1210
Albany, NY 12207

Phone: 518-434-3100
Fax: 518-434-3130


The Empire Center is an independent, non-partisan, non-profit think tank located in Albany, New York. Our mission is to make New York a better place to live and work by promoting public policy reforms grounded in free-market principles, personal responsibility, and the ideals of effective and accountable government.