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 Jobs Recovery Chugged to a Near-Halt in October

After rising sharply once the economy began to reopen, private payroll growth in New York ominously ran out of steam in October, according to the state's monthly jobs report. Read More

New York’s Rising COVID Curve Casts Doubt on Cuomo’s ‘Micro-Cluster’ Strategy

The ongoing surge in New York's coronavirus pandemic raises doubts about the effectiveness of Governor Cuomo's "micro-cluster" strategy. Read More

Thanks to Unions, NYC’s School Reopening Deal Was Costly and Educationally Hazardous

New York City schools reopened this fall under terms dictated by the city's teacher and principal unions. Now, as city schools close -- once more at the unions' behest -- the city is left with thousands of extra teachers hi Read More

New Yorkers’ Personal Income Growth Rebounded a Bit in 2019

After , personal income growth matched or exceeded national averages in most parts of New York State in 2019, according to the from the federal Commerce Department's Bureau of Economic Analysis (BEA). The 2019 income rebound was most pronounced in New Read More

With State Officials’ Freeze Through 2023, More Reason To Ice All Government Pay

In light of the state government’s “extremely precarious financial position,” New York’s state lawmakers, judges, statewide elected officials and certain gubernatorial appointees should not receive pay raises in the Read More

The Autumn Coronavirus Wave Is Hitting New York’s Nursing Homes, Too

Coronavirus infections are again rising in New York's nursing homes, a sign that blanket testing, tight limits on visitors and other precautions have not fully isolated their acutely vulnerable residents from conditions in Read More

DiNapoli Predicts $3.8B More in State Tax Receipts

New York State's tax receipts in the current fiscal year will exceed Governor Cuomo's latest projections by $3.8 billion—still down from last year, but a big improvement over the governor's worst-case scenario—according to updated estimates from state Comptroller Thomas DiNapoli's office. Read More

With Hopes Dashed for “Blue Wave” Bailout, Cuomo Needs to Deal With Budget Shortfall

With the national election results still unclear, Governor Cuomo can no longer put off tough decisions on how to balance New York's pandemic-ravaged state budget. 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.