State Budget & Recent 1% Reduction

January 20, 2020

The Governor’s executive budget proposal announcement is scheduled to take place tomorrow at 1:00.  As always, we’ll share an initial discussion of budget proposals of interest to NYS Council members as soon as we can.

Below is a link to an article discussing health insurer fears that Gov. Cuomo intends to increase taxes on the plans in order to cover at least some of the state budget deficit.  When the plans have been taxed in this manner in the past it has resulted in increases to private insurance premiums that are passed on to beneficiaries and the entities that insure them.

Earlier this month we learned that health plans were impacted by the 1% reduction we reported on after the publication of the 12/30/19 NY State Register.   The reduction (effective 1/1/2020) impacts DoH Medicaid payments and so, the Programs and Services licensed/certified by DoH that received Medicaid funds.    The language in the State Register says that mental hygiene programs and services are exempt. This seems to include the new children’s CFTSS services.  But there are complications.  For instance, the Health Home Program is impacted by the 1% cut (it’s a DoH Program that receives Medicaid funds).  Children’s advocates are particularly concerned about Children’s Health Homes and none of us can get a clear answer as to whether they are subject to the cut given various federal Maintenance of Effort requirements.  Finally, we are deeply concerned about whether health plans participating in BH MMC will be permitted to reduce APG government rate payments to help cover their cut.  Since these payments are for mental hygiene (including OASAS and OMH) programs and services, health plans should not be permitted to reduce APG government rate payments (to BH MMC providers).  And while it sounds like this is how it will play out, we do not yet have certainty about this and we are told we must wait for new guidance documents that will be hitting the streets shortly (it may be up to a few weeks) that will address how the 1% reduction will be implemented.

We can only imagine how difficult this must be for our members who need and deserve concrete information on this matter, especially since the 1% reduction was effective 1/1/2020.  We are pushing key state leaders to make this information available immediately. If you haven’t already made a commitment to join us at our upcoming NYS Council Annual Business Meeting and Lobby Day in a few weeks (2/4-5) in Albany we urge you to do so at once.  This will be a critically important meeting with key state leaders who need to hear our concerns.  If you’d like to register for the event please contact me at:  or call me at 518 461-8200 as soon as possible.  

Private health insurers fear Cuomo to increase taxes to cover $6.1B deficit