25857060048_f7c028f8f0_m-3261139Governor 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

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

Remembering the scandal that brought down Health Commissioner Howard Zucker

The resignation of Dr. Howard Zucker as state health commissioner marks the end of a term marred by scandal over his role in managing the coronavirus pandemic. The much-debated compelling nursing homes to admit COVID-positive patients, though it origi Read More

After 10 weeks, all but five of the Empire Center’s 63 requests for pandemic data remain unfulfilled

Over the 10 days that Hochul has been in office, there has been no further progress on the Empire Center's record requests. Read More

New York’s health benefits remain the second-costliest in the U.S.

New York's health benefit costs increased faster than the national average in 2020, leaving it with the second-least affordable coverage in the U.S. The state's average total cost f Read More

Another Hochul To-Do: Timely Financial Reporting

The state will spend a record $212 billion in the current 2022 Fiscal Year, under the budget its elected leaders adopted in April. Read More

Can Cuomo still be impeached?

Andrew Cuomo and Donald Trump have more in common than boyhood homes in Queens. Like Trump, Cuomo could still face impeachment and an impeachment trial despite a promise to resign as Governor later this month. Read More

The Gov’s pension

There are several (dozens? hundreds?) of unanswered questions as the fallout from Andrew Cuomo's resignation earlier today continues. Among those are questions related to his pension, some of which can be answered, sort of. Read More

The Health Department’s FOIL Responses Signal an Indefinite Wait for Pandemic Data

The quest for comprehensive data on New York's coronavirus pandemic hit a bureaucratic roadblock this week Read More

A Study of COVID-19 in Nursing Homes Raises Doubt About New York’s Minimum Staffing Law

A newly published study of COVID-19 in nursing homes links larger numbers of employees to higher rates of infection and death for residents – raising fresh doubts about New York's recently enacted "safe staffing" law. 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

General Inquiries: Info@EmpireCenter.org

Press Inquiries: Press@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 Enjoying our work? Sign up for email alerts on our latest news and research.
Together, we can make New York a better place to live and work!