Cuomo’s plan for Medicaid includes incentives for savings to local government, more cost if expenditures rise

Governor Andrew Cuomo outlined his vision for changes to the Medicaid program in New York, which has created a shortfall of more than $2 billion for the upcoming budget process.

While local officials around the region were worried that Cuomo might push to undo an agreement made in years past, which ensured that the state would pay for any excess cost beyond the 25% share local governments incur through Medicaid.

That measure froze Medicaid payments by counties to Albany, in exchange for their compliance with the tax cap. However, Cuomo’s plan puts added pressure on local governments to ensure that they stay within the property tax cap. It also assumes they continue finding new ways to consolidate and save money.

The Governor announced that he will seek to reimplement the Medicaid Redesign Team, which worked in 2011 to find efficiencies in the Medicaid system.

The MRT II team, which will work over the next two months to find efficiencies in the system – will have a series of expectations, according to the Governor.

Those included:

– Zero impact on local governments;
– Zero impact on beneficiaries;
– Find industry efficiencies and/or additional revenue;
– Root out waste, fraud, and abuse; and
– Report by back a set deadline of April 1st.

“I believe in the MRT. It worked before, I believe it will work again,” Governor Cuomo said.

He says that local government will need to have ‘skin in the game’ though. Under his proposal, local governments will have to stay within the two percent tax cap, and if they exceed the average three percent growth clip that the state has accepted as ‘standard’ they will pay the increase for that year.

The plan will build a financial incentive for local governments that find efficiencies through the program. “If they stay under the three percent increase, they get a savings of 25 percent,” Cuomo said during his address.

It’s unclear how local officials, or the legislature, will react to this proposal. Upstate lawmakers have lobbied for years at lowering the impact to rural, poorer communities that have a difficult time shouldering the burden of the existing Medicaid program.

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