Taxpayers Will Suffer If Feds Lower Medicaid Matching Funds

New York could lose $1.4 billion

June 22, 2004

New York stands to lose $1.4 billion – more than any other state – if the enhancements to the Federal Medical Assistance Percentage program are allowed to expire, Assemblymember Kevin Cahill (D-Ulster, Dutchess) recently stated. The program, which is set to expire next month, was created last year to help deal with massive budget deficits that states across the country faced.

"Allowing this program to expire would tear a huge hole in New York’s budget," Mr. Cahill said. "Losing this money means that either access to quality care will decline, or local governments will be saddled with even higher costs that will translate into even higher property taxes. That’s unacceptable."

Until the enhanced FMAP program, New York State and the federal government split Medicaid costs 50-50 – lower than the matching rates enjoyed by 37 other states nationwide. Under FMAP, the federal government covered an additional 2.95 percentage points, making the split with New York roughly 53-47 and giving state and local governments a small measure of relief from skyrocketing health care costs. In essence, New York State would have to put up an additional $1.4 billion in the next fiscal year to make up the difference. Ulster County and Dutchess County would loose approximately $2,522,546 and $2,548,198 respectively, according to the New York State Association of Counties.

Mr. Cahill sponsored a resolution (K.1952), recently passed by the Assembly, calling on the state’s congressional delegation to keep the enhanced FMAP rates in place. In addition, on March 1, 2004, the Assembly Standing Committee on Health passed A.9224, the "Taxpayer Relief Act of 2004", which essentially caps Medicaid costs for counties at this year’s level. Mr. Cahill is both a member of the Health Committee and a sponsor of this legislation. A.9224 remains under consideration by the Assembly Ways and Means Committee.

"Medicaid already puts a huge burden on state and local governments, and we can’t afford to pay more," Assemblymember Cahill noted. "It’s time for our representatives in Washington to step up to the plate."

Mr. Cahill also pointed out that Governor Pataki’s close relationship with President Bush hasn’t translated into any tangible benefits for New Yorkers. For example, despite the Governor’s frequent stumping for the President, New York still ranks far below states like Wyoming in per capita homeland defense funding.

"The only campaigning the Governor should be doing right now is for more money from Washington," Assemblymember Cahill said. "This is a problem that must be solved if we want to protect access to health care and keep taxes down, and the Assembly is committed to doing whatever it takes to solve it."

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