On John Gambling’s radio show this morning, Senate Republican leader Dean Skelos reiterated his warning that President Obama’s executive order on immigration could cost the state as much as $2 billion.
“Our estimates are conservative,” Skelos said.
But Skelos’ numbers, which he has used to warn of potential cuts to other programs, appear to present a worst-case scenario for the state budget from the president’s order, which could add thousands of previously undocumented immigrants to the state’s Medicaid rolls.
On Monday, Skelos sent a letter to senators Chuck Schumer and Kirsten Gillibrand asking them to urge the president to increase the amount of money the federal government pays for New York’s Medicaid program, a prospect that would require Congress to change a longstanding law that governs the formula for state payouts.
Schumer and Gillibrand responded that Skelos’ time would be better spent convincing House Republicans to pass comprehensive immigration reform.
“That’s not the issue for the state,” Skelos told Gambling. “The issue for the state is we’re going to be burdened with this huge mandate that quite frankly we just can’t afford, the taxpayers can’t afford.”
But how large is that mandate?
Skelos’ office declined to detail how he arrived at the $2 billion figure, but a spokesman referred Capital to a similar estimate made by E.J. McMahon, president of the Empire Center for Public Policy, who was quoted in the Daily News estimating it could cost hundreds of millions of dollars, which is far less than Skelos predicts.
Asked about Skelos’ estimate, McMahon told Capital, “That’s clearly high-balling it.”
Skelos may have used a Migration Policy Institute study to assume that roughly 200,000 adults and 100,000 children in New York will be eligible for legal status, entitling them to Medicaid.
If each adult costs Medicaid $7,900 and each child costs $1,500—figures cited by Jason Helgerson, the state’s Medicaid director, during a presentation he gave earlier this year—that would bring the total to approximately $2 billion.
But that math assumes that every eligible immigrant qualifies for Medicaid.
That assumption appears to be an exaggeration “for political effect,” McMahon wrote on his blog.
Even at a more modest estimate, Obama’s order could have a significant impact on New York’s Medicaid budget.
“The low-end will add to state funded Medicaid spending,” McMahon said. “The only question is how much.”
McMahon estimates somewhere between $250 and $500 million, and suggested the order pits Governor Andrew Cuomo’s penchant for financial restraint against his desire to help immigrants enroll in benefits.
A state health department spokesman said the state was reviewing the president’s order. The state was not yet able to provide its own estimate for how much this would cost, but some of the cost could be offset by less state spending on emergency medical services for immigrants without health insurance.
McMahon points out that the additional spending would bump up against the state’s Medicaid growth cap, a point Skelos made on Gambling’s radio show.
“The only way you can keep [Medicaid growth] under the cap is raising taxes or cut vital programs within the system,” Skelos said.
But that assumes all those immigrants would enroll in Medicaid during the next fiscal year, an idea that seems implausible given that the president’s executive order won’t take effect for children brought here by their parents until February of 2015, and won’t take effect for immigrant parents of citizens or permanent residents until May of 2015. The state’s fiscal year ends in June.
More likely, the staggered timeline and the inevitable bureaucracy would spread the additional costs over time.
“It will be interesting to see how much higher the enrollment projection goes in Cuomo’s next Executive Budget,” McMahon wrote on his blog.
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