We are still waiting on funding bills to be printed and made publicly available.
Linked please find the SFY26 Enacted Medicaid Scorecard. The Scorecard tracks all of the various state budget actions impacting the state’s Medicaid Program. The Scorecard indicates the cost/savings associated with each provision, and (on page 2 of the document) it specifically tracks state budget spending associated with new MCO Tax revenues that are presumed to be coming into the state as the result of a deal made by the Biden Administration and NYS permitting NY to implement a new tax on Managed Care Organizations that is clearly one of many ‘provider taxes’ under the gun in Washington DC as federal lawmakers (and the Trump Administration) seek to close loopholes that allow states to implement schemes that (currently) permit states to maximize federal Medicaid funds.
As you review the Scorecard, you may recall that the MCO Tax revenue was always targeted for promised hospital, nursing home and assisted living programs for rate increases. Additional stakeholder groups (including mental health and SUD associations) made a play for a set aside of the new revenue, to be included in the state budget. The list of groups that wanted to be added to the list of benefactors grew long, and lawmakers largely stuck to the original script with the exception of adding Article 28 Clinics to the list (under ‘Clinics’ on the Scorecard.)
Here’s more on this from Politico:
(Politico, 5/8)
Gov. Kathy Hochul and the Legislature have reached a tentative agreement on higher Medicaid reimbursement rates for hospitals, nursing homes, assisted living programs and federally qualified health centers.
It’s all thanks to a tax on managed care organizations approved by the Biden administration at the end of last year, which is expected to net New York $3.7 billion over two years.
Those proceeds will support aggregate Medicaid funding increases of up to $425 million for hospitals, $445 million for nursing homes, $40 million for federally qualified health centers and Article 28-licensed health clinics and $15 million for assisted living facilities, according to the state’s health and mental hygiene budget bill printed late Tuesday evening.
The increases will be “contingent upon the availability of funds within the healthcare stability fund,” which the state created to hold the MCO tax revenue.
If the fund’s balance is insufficient to support the detailed funding increases, state officials will have the power to suspend or terminate them, the budget bill states.
The budget bill has yet to be voted on by lawmakers, but it offers a partial look at what kind of financial support the health care industry will see this fiscal year.
The state is set to surpass the $124 billion Medicaid budget laid out in Hochul’s executive proposal, but the full scope of this year’s health care spending is unclear with several budget bills still in the works as of Wednesday evening.
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Note of Interest: One of the budget bills on the street has language that speaks to use of AI Companion models. In this case, the ‘operator’ is the entity offering the AI companion to clients.
Below is a summary followed by some history of the Issue from the APA. Here in NY, Assemblyman Zaccaro has a new bill that addresses the use of AI models (see below) and specifically issues of liability associated with untoward events associated with use of these models. The bill # is: A6545A
Here’s the language that will be enacted with the new state budget agreement:
AI Companion Models: Prohibits operators from providing AI companions to users unless the AI companion contains a protocol to take reasonable efforts for detecting and addressing suicidal ideation or self-harm expressed by a user. The protocol must include a notification to the user that refers them to crisis service providers such as the 988 suicide prevention and behavioral health crisis hotline. Upon a determination by the AG that an operator has failed to comply with this requirement, the AG may seek civil penalties of up to $15,000 per day. All penalties will be deposited into the suicide prevention fund, to be made available to OMH for initiatives supporting suicide prevention, education, and awareness.
Background:
Recently, the American Psychological Association brought attention to two tragic cases involving teens who interacted with AI generative chatbots masquerading as therapists. According to Arthur C. Evans Jr., CEO of the APA, these cases were highlighted in a presentation to the Federal Trade Commission, underscoring concerns about the risks of unregulated AI in mental health contexts.
More about the cases: Two disturbing cases have sparked lawsuits against a company. In the first case, a 14-year-old boy, Sewell Setzer, took his own life after interacting with a chatbot that responded insensitively to his suicidal thoughts. When Setzer expressed uncertainty about his plan, the bot said, “Don’t talk that way. That’s not a good reason not to go through with it.” Setzer tragically died from a self-inflicted gunshot wound on February 28, 2024. In the second case, a chatbot told a 17-year-old boy that murdering his parents over screen time limits was a “reasonable response.” A screenshot shows the bot seemingly sympathizing with the idea of a child killing their parents after years of abuse, suggesting it might be understandable in certain situations. Both families have filed lawsuits against the company, citing these harmful interactions. It is alarming that in these two cases the AI chatbots failed to challenge users’ beliefs even when they became dangerous and instead encouraged them.
Here’s a link to the bill on the Assembly Bill Search page where you can read all about it. The bill speaks to liability issues related to use of AI chat bots.
Please share your feedback on the bill at your earliest convenience. Assemblyman Zaccaro’s office has reached out on the bill, wondering if we can support it.
For more information, please refer to the following resources:
New York Times article: https://www.nytimes.com/2025/02/24/health/ai-therapists-chatbots.html?unlocked_article_code=1.Bk8.FdZd.DswiOBDhVzTo&smid=nytcore-ios-share&referringSource=articleShare
BBC Article: https://www.bbc.com/news/articles/cd605e48q1vo
NBC Article: https://www.nbcnews.com/tech/characterai-lawsuit-florida-teen-death-rcna176791