Governor Cuomo’s budget makes no major change in the Essential Plan—a low-cost state-sponsored health plan—despite the loss of almost $1 billion in federal aid.
Coverage for about 700,000 enrollees appeared to be at risk after the Trump administration halted certain subsidy payments under the Affordable Care Act, which accounted for nearly a quarter of the Essential Plan’s funding, or about $950 million.
But the governor’s executive budget indicates that the program will continue as-is—and sketches surprisingly easy-sounding ways of making up for the lost money.
The Essential Plan is an optional benefit under the ACA that only New York and Minnesota exercised. It covers people just above the eligibility cutoff for Medicaid, from 138 percent to 200 percent of the federal poverty level. To pay for the coverage, Washington sends New York State the money that otherwise would have spent on tax credits and other subsidies if those same people had enrolled for private coverage through an ACA exchange.
But a federal court ruled that money for one of those subsidy programs, known as cost-sharing reduction or CSR, had not been properly appropriated by Congress—leading Trump to cut off CSR payments in October.
Cuomo’s budget proposal holds out hope that Congress might still restore the original funding. In fact, it projects that overall federal aid for the Essential Plan will grow, thanks to formula-driven increases from other ACA sources. The governor’s financial plan even shows the state’s contribution for the $3.9 billion program shrinking to $102 million for fiscal year 2019, about a quarter of what was previously estimated.
If CSR is not restored, the financial plan says the state can at least partially offset the loss with refunds it is owed by insurers who manage the program, cuts to premiums going forward, and other measures. The state could also dip into a contingency fund that Cuomo wants to establish to backfill as a hedge against cuts in New York’s federal healthcare funding.
As proposed by Cuomo, that contingency fund would filled with proceeds from converting non-profit healthcare companies to for-profit status, along with new taxes on health insurers and opioid manufacturers.
The financial plan further reports surprisingly low enrollment numbers for the Essential Plan: 684,000 for the current fiscal year, growing to 689,000 in 2019. Just last month, the New York State of Health said 719,000 people had signed up for the program.
About the Author
You may also like
While New York’s Medicaid Budget Soared, Public Health Funding Languished
Four years after a devastating pandemic, the state has made no major investment to repair or improve its public health defenses.
While funding for Medicaid over the past four years Read More
A Medicaid Grant Recipient Sponsors a Pro-Hochul Publicity Campaign
While much of the health-care industry is attacking Governor Hochul's Medicaid budget, at least one organization is rallying to her side: Somos Community Care, a politically active medical group in the Bronx that recently r Read More
New Jersey’s Pandemic Report Shines Harsh Light on a New York Scandal
A recently published independent review of New Jersey's pandemic response holds lessons for New York on at least two levels.
First, it marked the only serious attempt by any state t Read More
Loss of Patients and Revenue Foreshadowed Downsizing for SUNY Downstate
The SUNY-owned hospital in Brooklyn facing a newly announced downsizing plan has seen its patient volume and revenue plunge over the past decade, according to a review of its financial reports.
Read More
How a Medicaid Program To Improve Nursing Home Care Ended Up Paying for Union Benefits
New York State's budget-making process sometimes works like a closed loop, as interest groups on the receiving end of state spending reinvest a portion of their proceeds to lobby Albany for still more money.
Read More
Hochul’s ‘Straight Talk’ on Medicaid Isn’t Straight Enough
Arguably the biggest Medicaid news in Governor Hochul's budget presentation was about the current fiscal year, not the next one: The state-run health plan is running substantially over budget.
Read More
Despite Lingering Shortages, New York’s Health-Care Workforce Is Bigger Than Ever
The state's health-care workforce is recovering unevenly from the pandemic, with persistently lower employment levels in some areas and robust growth in others.
This mixed pattern c Read More
The Wacky Math of New York’s Essential Plan
Thanks to an absurdly wasteful federal law, New York's Essential Plan is expected to continue running billion-dollar surpluses even as state officials more than double its spending over the next several years.
Read More