screen-shot-2017-01-10-at-4-20-49-pm-300x190-4647850Although called “extenders,” the temporary budget bills that were speeding through the Legislature on Monday go beyond a simple continuation of the status quo, especially in the area of healthcare.

Among a laundry list of policy changes, the two bills establish a “cap” on Medicaid drug spending and expand Medicaid benefits to cover certain infertility treatments as well as bottled human breast milk for newborns.

The bills also appropriate $2.5 billion for drinking water infrastructure projects, but do not fully specify where that money will be found or how it will be allocated.

In addition, Monday’s budget bills included the single biggest revenue action the Legislature is likely to take this year: extending the state’s Health Care Reform Act.

Continuing HCRA’s taxes on health insurance through 2020 will bring in $13.3 billion over the next three years. Extending the much-debated income tax surcharge on millionaires, by contrast, will raise a projected $12.6 billion.

The two temporary budget bills – totaling more than 1,700 pages – were introduced by Governor Cuomo on Monday as a stopgap after he and the Legislature failed to agree on a budget before the start of the new fiscal year on Saturday. The package was meant to keep state government operating through May 31.

The Senate quickly passed the measures by a pair of 46-15 votes. The Assembly was due to take them up Monday evening passed them by votes of 107-35 and 105-37.

The cap on Medicaid drug spending appears to be a watered-down version of an initiative proposed by Cuomo in January.

The original plan empowered the Health Department to set benchmark prices for certain expensive drugs. Manufacturers who charged more than the benchmark would have had to rebate 100 percent of the excess to rebate, or pay a 60 percent surcharge on sales to the private sector.

The plan introduced by Cuomo on Monday – which mirrors an alternative in the Senate Republicans’ one-house budget proposal – empowers DOH to negotiate supplemental rebates on high-priced drugs, and to impose a target rebate and other sanctions if manufacturers don’t come to terms. However, the department can invoke those powers only if overall Medicaid drug spending exceeds a certain growth rate in the next two fiscal years.

Adding bottled human breast milk as a benefit under Medicaid also reflected a proposal in the Assembly Democrats’ Senate Republicans’ one-house budget.

Adding Medicaid coverage for “ovulation enhancing drugs,” a treatment for infertility, appeared to be a new proposal. It was not mentioned in either of the two houses’ one-house budgets or in the governor’s earlier spending plans. State law has required private health plans to cover infertility drugs since 2002.

Update: The Senate GOP budget called for Medicaid to cover “infertility services” in line with the mandate on private insurance. The provision about ovulation enhancing drugs appears to be a modified version of that proposal.

Correction: As noted above, the provision calling for Medicaid to cover donated breast milk originated in the Senate Republicans’ one-house budget proposal, not the Assembly Democrats’.

 

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’s Medicaid and Public Health Crises Get Short Shrift in the New State Budget

In spite of an ongoing pandemic and spiraling Medicaid costs, New York's health-care system received surprisingly little attention in the new state budget. On issue after issue, law Read More

Empire State’s new budget is a bridge to nowhere

Looking ahead to an uncertain post-pandemic recovery, New York’s newly enacted state budget for fiscal year 2022 raises spending by staggering amounts that—barring an unlikely rapid return to peak 2019 economic activity in New York City—can't possibly be sustained for more than a few years. The budget is a mid-2020s fiscal disaster in the making: an incomplete bridge over a deepening river of red ink. Read More

Spending to skyrocket under budget deal

The details apparently would get rancid if exposed to daylight, but Governor Cuomo and legislative leaders the broad outlines of their budget dea Read More

In Albany’s heaviest-spending year ever, lawmakers to OK even more pork

New York and its local governments—and yet the new state budget will pump even more money into New York's biggest capital pork-barrel slush fund. Read More

New York Lags in COVID-19 Vaccinations for Older Residents

In the race to vaccinate its oldest and most vulnerable residents, New York has fallen behind. Although the state's overall COVID-19 vaccination rate is somewhat higher than the nat Read More

Lawmakers Mull Medicaid Proposals That Would Speed New York Toward a Fiscal Cliff

As a budget deal nears in Albany, reining in spiraling Medicaid costs seems to be the last thing on anyone's mind. Governor Cuomo is advancing only Read More

Tax hike and huge spending increase seem likely in next NY budget

New York state today began its 2022 fiscal year without an adopted budget—which, in itself, is not a big deal. The state government can continue to pay bills and employee salaries next week if either final appropriations Read More

On Public School Enrollment, Census Contradicts State Education Department

Preliminary enrollment data from the State Education Department (SED) show that New York experienced the largest decline in public school enrollment in four decades. While the estimate is dramatic, it is also likely overly conservative. New Census data hint at a greater drop-off. Read More

Subscribe

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

CONTACT INFORMATION

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

Phone: 518-434-3100
Fax: 518-434-3130
E-Mail: info@empirecenter.org

About

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.

Empire Center Logo "...the Empire Center is the think tank that spent months trying to pry Covid data out of Mr. Cuomo's government, which offered a series of unbelievable excuses for its refusal to disclose...five months after it (the Empire Center) sued, Team Cuomo finally started coughing up some of the records." -Wall Street Journal, February 19, 2021

SIGN UP TO READ ABOUT THE ISSUES IMPACTING NEW YORKERS.