Health Budget: Lots of Good News
Statement by Assembly Health Committee Chair Richard N. Gottfried

While most attention has been focused on Medicaid funding for hospitals, nursing homes, home care and pharmacy, the new 2008-09 state health budget approved by the Legislature includes an impressive list of important health reforms and initiatives. This is the best health budget New York has had in many years.

Primary and preventive care. In a long-overdue groundbreaking change, this budget begins to shift resources from inpatient hospital care to primary, preventive and other outpatient care. Medicaid payments will increase for community health centers; physician, dentist and other office-based care; school health centers; family planning clinics; hospital outpatient clinics; and others. Payments will be based on the degree of services provided, instead of a flat rate per visit. The new rates will be phased in over three years.

Child Health Plus expansion. Last year, New York raised the income eligibility level for Child Health Plus from 250% of poverty to 400%. But that required Federal matching money, which the Bush Administration refused to do. The budget removes that requirement. The state will pay the full cost and tens of thousands of children will get health coverage.

Rx discount card. There will be a new prescription drug discount card for some low-income people who have no drug coverage. The discounts will come from the state using its bargaining clout with drug companies, not taxpayer dollars. Unfortunately, the card is narrowly limited to people who have a serious disability or are 50 to 64 years old. This will exclude perhaps millions of people who should have been eligible and who have staggering drug costs. Limiting the number of participants also limits the state's bargaining power to get bigger discounts. I will fight to get this program expanded. The new program uses the EPIC eligibility standard: income up to $35,000 for an unmarried person and up to $50,000 for a married household.

Doctors Across New York. New York will offer to repay a new physician's medical school loans if he or she practices for five years in an underserved area in primary care or certain shortage specialties. The Health Department will study expanding the program to include dentists, midwives, nurse practitioners, and physician assistants and report back to the Legislature later this year.

Hospital indigent care reform. Hospitals have long received state payments for "uncompensated care" they provide to uninsured patients, but there is little accountability to make sure the money is spent on care for patients who need financial assistance. The budget creates a new system to calculate the payments based on actual care to patients, so the money can go to the hospitals that are providing the most care. For now, the new system will only apply to 10% of indigent care reimbursement, but with the new system in place, the data will be developed to make future expansion possible.

Nurse-family partnership. Low-income first-time mothers will be able to have a series of nurse home visits from early in the pregnancy till after birth, paid for by Medicaid. Mothers with premature babies will also be eligible. This is modeled on programs in New York City and elsewhere around the country that have been highly successful in improving birth outcomes.

Pharmacy education for prescribers. Drug companies do heavy marketing to physicians, other prescribers and consumers to get their highest-profit drugs prescribed more often. Now the Health Department will launch an education program for physicians and other prescribers. It will deliver evidence-based scientific information, focused on helping patients get better health care and save money - not on selling a particular drug.

Disease management. "Disease management" uses nurse and others to help make sure that patients get the right care, take their medications, etc. These services will now be reimbursable by Medicaid. This should produce better outcomes and help control costs.

Streamlining enrollment in public health coverage. About half of New York's uninsured people are eligible for Family Health Plus, Child Health Plus or Medicaid. To help get them enrolled, the Health Department will run a state-wide enrollment program, including the ability to enroll on-line. The budget also enacts other changes to streamline enrollment.

Funding for key programs. The Assembly provided additional funding for key health programs including HIV/AIDS services, family planning, and school health clinics.

State legislation can be found on-line at The health substantive budget bill is A.9808-C and the appropriation bill is A.9804-C. For further information, e-mail the Assembly Health Committee at or call 518-455-4941.

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