State Tackles Long-Overdue Redesign of Medicaid

January 24, 2011
A team has been formed to find ways to reduce the costs and increase the quality in the Medicaid program for the upcoming 2011-12 fiscal year. The Governor’s office recently announced this redesign team in conjunction with plans to reform our state budget.

The New York Medicaid system spends more than $53 billion a year to provide health care to more than 4.7 million people in need. It is the largest health insurance program in the state. Our state also maintains the largest Medicaid system—larger than California, which has an estimated 17.4 million more residents than the state of New York. One study says New York spends as much as California and Michigan combined. At this rate of growth, Medicaid is unsustainable, as costs are projected to grow.

Restructuring Medicaid is long overdue. My colleagues and I have advocated for Medicaid reform for years. If you were to look at a pie chart of the state budget, you would see that Medicaid comprises the largest piece of that pie by far.

In recent days, we’ve seen media coverage of the redesign team. Some cite startling facts. The Erie County executive said in one report that 96% of Erie County’s 2010 tax levy went to Albany to pay for Medicaid services. This is unaffordable. Counties have been asking for ways to opt out of some of the services they are required by New York State law to provide—non-essential services not mandated by the federal government. Opting out of the non-essential services is critical if we are going to institute any cost savings within the local property tax structure. Again, as I said in last week’s column, property tax cuts cannot happen without mandate reform. Medicaid contains many state mandates for counties especially, without giving the counties any room for discussion. I’m pleased that discussion has begun.

The redesign team is comprised of 27 people that include medical and healthcare leaders throughout the state. The team will meet across the state; however, there are no meetings scheduled in Central or Upstate New York. The public is encouraged to participate and weigh in with their suggestions on the Governor’s website. That form can be accessed at https://apps.nyhealth.gov/health_care/medicaid/ redesign/contact_form.action. I would encourage you to participate in the survey form if you have some ideas on how to restructure or change Medicaid.

One of the easiest ways to save money within the Medicaid system is to put an end to the fraud, waste and abuse. It is estimated that 10% of total Medicaid dollars spent each year in New York is on waste, fraud and abuse. In 2005, Governor Pataki created the Office of the Medicaid Inspector General. This helped save the state a total of $551 million in 2008. This was a step in the right direction; however, more needs to be done. I am hopeful the redesign team can come up with a framework for public health insurance that is more within our means but still provides the necessary medical services that people require.

If you have any questions or comments on this or any other state issue, or if you would like to be added to my mailing list or receive my newsletter, please contact my office. My office can be reached by mail at 200 North Second Street, Fulton, New York 13069, by e-mail at barclaw@assembly.state.ny.us or by calling (315) 598-5185.