MCO Procurement

January 19, 2022

Towards the very end of the executive budget preparation period and when it looked like we would NOT secure a full carve out of BH services from MMC, we put forward several requests to address the administrative burdens currently placed on providers who are often forced to do business with numerous MCOs all of which have their own paperwork, requirements and other expectations of providers.  One of our requests was to move NYS from an ‘application’ state (in which state simply issues an RFP from interested MCOs that want to participate in the carve-in, review the application along a number of measures, and if the MCO checks the boxes, they are approved) to a ‘procurement’ model in which MCOs must compete for a spot in the carve-in.  Most states around the country employ a procurement model; however, NYS has not done so to date.  We are very pleased to report that the executive budget proposal released yesterday includes language that would move NYS to a procurement model as well as language that supports this change.  But we anticipate a major fight going forward.

Below is the first shot across the bow from Eric Linzer, President and CEO of the Health Plan Association, who claims in the paragraph (highlighted below in blue) that somehow reducing the number of MCOs participating in the BH carve in will harm care recipients.  Incredible.  And worthy of a public response from us.  Stand by.



What’s in Hochul’s $104.5B health spending plan for FY23

Crain’s Health Pulse, 1/19/2022

Gov. Kathy Hochul, along with the state Division of the Budget, unveiled the 2023 executive budget Tuesday, with an expected $104.5 billion allocated to health care.

The bulk of that remains Medicaid spending, which takes up $92 billion. Of that amount, $50.6 billion is expected to be federal spending, and $33.1 billion state spending. The Medicaid figure represents a 10% increase from fiscal year 2022, when it was about $83 billion.

The state Department of Health budget was set at $6.1 billion, an 11% increase from its $5.5 billion budget in fiscal year 2022. The Essential Health Plan, the state’s affordable insurance program for those who don’t qualify for Medicaid or Child Health Plus, got a 7.3% bump to $6.2 billion from $5.7 billion. The Office of the Medicaid Inspector General had its budget increased nearly 2% to $49 million, and the Office for the Aging’s budget also was upped by nearly 2%, to $273 million.

The executive budget outlines specific programs for the 2023 fiscal year that can draw upon outlined budgets from the aforementioned departments or sectors.

Hochul’s executive budget will be up for discussion with the state Legislature in the spring.

Safety-net hospitals can expect $2.8 billion to “support urgent operating needs” and to address pandemic-related impacts, the governor said.

Providers that take Medicaid will see the 1.5% reduction in reimbursement rates enacted in fiscal year 2021 restored and see rates increased by 1% on top of that, according to the budget. It represents a $3.7 billion investment over multiple years. The across-the-board rate increase was enacted to attract qualified workers and as a response to industry requests for payment reform, according to the budget.

Funding was restored for mainstream and managed long-term care quality pools, which had $77 million cut. The MLTC program and HIV special-needs plans—both Medicaid programs—are set to get $35 million added to them through boosted premiums to the middle and high ends of the rate range.

Medicaid has been further expanded by eliminating the resource eligibility test and increasing the income level to 138% of the federal poverty level, better allowing low-income New Yorkers age 65 and older and those with disabilities to maintain dual eligibility with Medicare.

The executive budget also has earmarked $20 million to expand access to holistic prenatal and postnatal care. This is in addition to a federal Medicaid provision passed last year to extend postpartum coverage to one year from 60 days after birth.

Other programs include a nutrition and farmer support program, Nourish New York ($50 million); harm reduction and naloxone distribution ($17 million collectively); and local health department supplemental funding for grant-work and workforce hiring/retention ($26 million collectively).

Health professionals welcomed Hochul’s budget, especially the restoration of the Medicaid rate cuts.

“Her proposals to grow and retain our workforce and invest in aging infrastructure are much needed and greatly appreciated,” said Bea Grause, president of the Healthcare Association of New York State, which represents nonprofit hospitals and nursing homes.

Some saw bad mixed in with the good in Hochul’s budget. Eric Linzer, president and CEO of the New York Health Plan Association, broadly welcomed Hochul’s plan to expand Medicaid and restore MLTC quality pools, but held misgivings about the new procurement process for managed care. “We are concerned about the proposed procurement for managed care contracts and the potential disruption it could have on the state’s most vulnerable citizens, including taking away options from the more than 5 million New Yorkers who rely on these health plans for their care,” he said. —S.S.