More on State Budget Update for SFY2021

April 6, 2020

Please find the enacted state budget summary we first sent you on Friday afternoon as well as the Medicaid Scorecard we shared with you last week. 

About the information below:

The enacted state budget grants extraordinary fiscal powers to the Governor that allows him to withhold or change budgeted funding levels if he determines that during the year there won’t be sufficient revenues to meet expenses. If that happens, he can unilaterally cut spending if “such action is necessary to respond to the direct and indirect economic, financial and social effects of the Covid-19.” All of this means that the allocations (discussed below) could change later in the year depending on the state’s fiscal circumstances.  

The budget outlines three different time periods for a fiscal evaluation:

·      April 1, 2020 through April 30, 2020

·      May 1, 2020 through June 30, 2020

·      July 1, 2020 through December 31, 2020

Below we have listed some state budget outcomes of interest to NYS Council members.  (Again, please see documents attached for bigger picture): 

Prescriber Prevails

For the last fifteen years, whenever the Executive has proposed removing consumer protections around medication assistance, lawmakers have always funded the restoration of this critical program. This year was no exception.  Despite the fact that a proposal to remove the current Prescriber Prevails policy was included in the package of MRT 2.0 recommendations sent to the Governor, the policy remains in place.

Children’s Behavioral Health

The MRT 2.0 recommendation to restore the enhanced rate for CFTSS was accepted by the Governor.  Children’s BH funding is noted on the Medicaid Scoresheet under “Children’s Behavioral Health’ with spending of $1.7m for the next two years, effective 4/1/20. It is of course our hope that all of this money is for restoration of the CFTSS enhanced rates. 


The Budget continues the ‘BFair’ increases for the OMH, OASAS and OPWDD nonprofit workforce which comes in two rounds, a 2% increase starting this past January and another 2% that is about to be released. Here’s more:

    3for5: There was no funding included to support the sustainability of the human services workforce as advocated for through the 3for5 Campaign.

·      Wage Enhancement: The budget provides the promised 2% enhancement for 100, 200, and 300 category employees under OMH, OASAS, and OPWDD. This went into effect on April 1. OMH received $22.3 million for this purpose and OASAS received $9.6 million.

·     Minimum Wage: The spending plan continues to cover the cost of the minimum wage, with $4 million for OMH providers and $1.4 million for OASAS providers. The Human Services COLA was deferred until April 1, 2021.

OMH Housing

There is a $20 million housing rate hike that was successfully included in the year’s budget thanks to the ‘Bring It Home’.  

OMH: Capital

The budget adds another $60 million in capital to maintain and preserve community-based residential settings that allow people with mental illness to live in the most integrated setting possible.

OMH: Community Reinvestment 

For the first time in 24 years no additional psychiatric center bed closures are proposed.  As result, there are no funds for Community Reinvestment.

OASAS/OMH/DOH Parity Compliance

The budget establishes a Parity Compliance Fund- with funds from penalties imposed on plans for violations of the state’s Parity Law going to the fund that will support CHAMP (the MH/SUD ombudsman program) and other parity implementation and enforcement activities.  

OASAS: BH Ombuds Program (CHAMP)  

Enacted budget reappropriates $1.5 million for New York’s MH and SUD/Addiction Ombuds Program 

OASAS: Statewide Formulary for Opioid Dependence and Antagonist Agents

Establishes a Statewide Formulary for opioid dependence agents and opioid antagonists which shall be published by NYSDOH and shall include “preferred drugs” in such classes with no prior authorization required. The Cost for MAT must be equal/less than lowest cost paid in FFS/MC.  Under MC, if the drug prescribed is not on the statewide formulary, the prescriber shall consult the plan based on criteria (similar to what is in place for step therapy) for approval of the non-preferred or non-formulary drug. MC plans may not require prior authorization for methadone when used for an opioid disorder or part of a program.

‘Across the Board’ Cuts

The budget increases the 1% across the board cuts first imposed on DoH Programs and Services in January 2020. Budget language exempts Article 31, 32 and Article 16 Programs and Services.  

Medicaid and MRT 2.0 Recommendations 

Many MRT 2.0 recommendations were included in the enacted state budget, some with delayed implementation dates in order for the state to comply with Maintenance of Effort (MOE) requirements associated with NY accepting federal enhanced FMAP assistance during the emergency period.  (Please review the Medicaid Scorecard attached for a closer look at implementation plans and projected savings).   

Extend DSRIP Regulatory Waiver Authority. The final budget modifies the Executive’s proposal to extend the authority of the commissioners of DOH, OMH, OPWDD, and OASAS to waive regulations as necessary to allow the efficient scaling and replication of promising DSRIP practices, as determined by the authorizing commissioner, through April 1, 2021. 

Health Homes: The Final Budget includes annual funding of $279.35 million for the Health Home program. This reflects an annual decrease of $48.7 million from last year, consistent with the MRT proposals related to Health Homes.

VBP Demonstration Program

Authorizes NYSDOH, in consultation with DFS to implement one or more 5-year demonstration programs designed to implement health outcomes and reduce costs, using value based payments based on an actuarially sound pre-paid, capitated rate. The program may offer funding designed to improve health outcomes, develop infrastructure and systems and connect individuals with community-based organizations focused on social determinants of health.

Prompt Pay

The final Budget modified the Governor’s proposal to require Plans to notify members or providers through the internet or other electronic means for claims submitted electronically (in addition to in writing which is currently required), that the claim is denied or additional information is necessary to pay the claim, and to include the specific type of plan or product in which the member is enrolled. 

The final Budget also adds a definition of the plans and products that are subject to the prompt pay law. Specifically, it includes Medicaid managed care, Child Health Plus, Essential Plan, qualified health plans purchased on the New York State of Health, and any other comprehensive coverage subject to Articles 32, 43, and 47 of the Insurance Law or Article 44 of the Public Health Law. 

The final Budget deleted the requirement that interest would be due back to the original date in which additional information was requested. In the event that additional information is requested by the plan after submission of the claim, Plans are required to make any additional payments they determine are due within 15 days of the determination. 

The final Budget deleted the proposal to require the payment of interest on such payment computed from the date the claim was submitted. 

(Source:  Hinman Straub Budget Summary)

Coding Disputes 

The final Budget revised the Governor’s proposal to require Plans to review disputes regarding coding based on national coding guidelines accepted by CMS or the AMA, including ICD-10 guidelines, with the addition of language clarifying that such codes must be used to the extent they exist. The language also clarifies that the use of the national coding guidelines does not apply when the plan undertakes fraud, waste and abuse efforts; any subsequent payment adjustments, however, must be made consistent with the national guidelines. Current law also permits the parties to agree to an alternative process for the reconciliation of coding disputes. Plans are required to pay interest on the increased amount when they increase payment on a claim after reviewing information provided by a hospital to substantiate the coding. Interest is computed starting from 30 days after receipt of the initial claim, if electronic, and 45 days after receipt of an initial paper claim.  (Source: Hinman Straub Budget Summary)