May 1, 2012
Albany, NY

Governor Cuomo Announces Medicaid Spending Finishes Year $14 Million Under Global Medicaid Cap

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Governor Andrew M. Cuomo today announced that New York Medicaid spending finished the 2011-12 fiscal year $14 million under the Medicaid Global Spending Cap without reducing benefits, while providing health insurance coverage to an additional 140,000 low income New Yorkers.

 

The Governor also announced that the initiatives proposed by the Medicaid Redesign Team (MRT) and adopted by the Legislature last year will lead to major savings for state and federal taxpayers. The MRT initiatives will save a total of $34.3 billion over the next five years- divided between the state and federal government. Personal care spending is on the decline with per-recipient spending reduced to 2006 levels, and spending on home care has been reduced by $300 million since 2010. Without the MRT initiatives, state spending would have grown by $2.3 billion in the 2011-12 fiscal year.

 

"Finishing the fiscal year $14 million under the global spending cap demonstrates the effectiveness of the Medicaid Redesign Team's work over the past year. The MRT brought together industry professionals, health care experts, and the public to find ways to cut costs and improve care," Governor Cuomo said. "We have made major steps toward redesigning the state's Medicaid program to ensure that it provides top quality service to New Yorkers while protecting the taxpayer dollar. I commend the Co-Chairs of the Redesign Team, Michael Dowling and Dennis Rivera, as well as Medicaid Director Jason Helgerson and the other members of the Redesign Team for their hard work."

 

Initiatives taken by New York State and the provider community that helped attain these savings include:

  • Implementation of 78 Medicaid Redesign Team (MRT) and other saving initiatives passed by the Legislature in 2011 that saved the state $2.3 billion (and the federal government a comparable amount).
  • The health care industries working collectively to improve efficiencies of the New York State health care system, including:
    • Shifting less severe patients from the hospital and emergency room to more appropriate ambulatory/primary care settings;
    • Controlling home care and personal care spending that was previously climbing at double-digit growth rates prior to the MRT;
    • Shifting Medicaid recipients from costly fee-for-service into Medicaid Managed Care where services are better coordinated and financial incentives are more rational; and,
    • Voluntary repayment of over $50 million to the State for outstanding liabilities owed by providers.

 

About the Medicaid Redesign Team:

 

The Medicaid Redesign Team was established by the Governor in January 2011, bringing together stakeholders and experts from throughout the state to work cooperatively to reform the system and reduce costs. The MRT held a series of public meetings in every region of the state offering New Yorkers an opportunity to give their reform ideas either in person or in writing. Meetings were broadcast on the Internet and materials were posted on the MRT's web page. The MRT received over 4,000 ideas from New Yorkers.

 

The MRT worked in two phases. Phase 1 provided a blueprint for lowering Medicaid spending in state fiscal year 2011-12 by $2.3 billion. That phase was completed in February 2011 when the MRT submitted an initial report to meet the Governor's Medicaid spending target contained in his 2011-2012 budget. The initial report included 79 recommendations to redesign and restructure the Medicaid program to be more efficient and get better results for patients. 78 recommendations were approved by the legislature as part of the budget and are now being implemented. Due to the success of MRT project implementation in Phase 1, New York has saved the federal government more than two billion dollars.

 

The MRT continued its work in a second phase, breaking into 10 work groups to address more complex issues, as well as monitoring the implementation of key recommendations enacted in Phase 1. These work groups gave an additional 175 stakeholders the opportunity to participate in the MRT process. All work group meetings were public and multiple public hearings were held.The recommendations of the MRT are being compiled into a final report.

 

Michael Dowling, President and CEO of North Shore LIJ Health system, said, "The Medicaid Redesign Team made it clear that New York could not continue across the board reductions that are not in the best interests of health care providers or the people they serve. The work of the MRT has resulted in real reform recommendations which are the better option for health care providers, the people they serve, and the citizens of New York."

 

George Gresham, President of 1199 SEIU United Healthcare Workers East, said, "The MRT focused on preserving the quality of care for our most vulnerable residents. The collaboration of the State, industry leaders and service providers address budget concerns while sustaining the Medicaid program through reform."

 

Ken Raske, President of the Greater New York Hospital Association, said, "The MRT came together in the spirit of cooperation to identify ways to reform the Medicaid Program in New York. Through the dedication and diligent efforts of the MRT members, this action plan concludes real change is needed in New York and presents a strategy for moving forward."

 

Harvey Rosenthal, Executive Director, NY Association of Psychiatric Rehabilitation Services, said, "The collaboration and collective work of the MRT produced recommendations for much-needed change in New York's health care system. The proposals in this report address the needs of all New Yorkers, including those in need of community based behavioral health recovery, rehabilitation and peer support services in New York."

 

Daniel Sisto, President of the Hospital Association of New York State, said, "This MRT action plan is the final work product of an innovative effort to accomplish a compromise between the state's budget concerns and the charge to redesign the Medicaid program. The efforts of all of the members on the team have led to an effective and thoughtful set of recommendations to meet that challenge."

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