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Final NYS Budget 2016-17 - Harsh Medicaid Cuts Avoided

04 Apr, 2016

In the  final New York  State Executive Budget effective for the fiscal year beginning April 1, 2016, most of the harshest cuts to Medicaid eligibility that  Gov. Cuomo had proposed were not enacted.  The Medicaid budget language is in the Health and Mental Hygiene (HMH) (S6407-C/A9007-C)- find it here.   See full budget here.

Here is a brief summary of the outcomes of some of the proposals affecting Medicaid recipients.   Please click on the links below  to read  the testimony by NYLAG, Empire Justice Center at the above links. 

  1. Budget Preserves Impoverishment Protections for Married Couples and Children with Chronic Illness:

    • The final budget preserves the minimum Spousal Impoverishment Resource Allowance at the level of $74,820, rather than reducing it to $23,820 as proposed.  This is the amount of resources on spouse may keep if s/he is not on Medicaid and he other spouse is in a Managed Long Term Care plan, waiver program, or a nursing home.  The Governor's proposal would have meant that an elderly woman who had $50,000 in life savings could only have kept $23,820 if her husband needed to enroll in a Managed Long Term Care plan.  With the final budget, she can keep her $50,000 on life savings.  

      • Next year we urge the legislature  next year to increase the spousal allowance to the maximum allowed by the federal Medicaid program of $119,220 - with the federal  annual cost of living index.   The $74,820 allowance used by New York was the maximum federal allowance 20 years ago -- but was enacted without a cost of living index so has been frozen for 20 years.    

    • Spousal/Parental Refusal is Preserved  - For at least the 27th year, the legislature defeated the proposal to eliminate "spousal" or "parental" refusal again.  Because the Medicaid income and resource limits are so low - income limits well below the Federal Poverty Line, this protection is vital to prevent divorce or forced institutionalization of loved ones in nursing homes, when one spouse or a child with chronic illness need Medicaid for costly services.

  2. “Prescriber Prevails” Preserved  in Managed Care - Doctors with intimate knowledge of their patients’ diagnoses and other medications will still have the final say over what medications are necessary and appropriate for their patients, and will not be overriden by managed care plans or the State.  The Governor's proposal would have eliminated "prescriber prevails" for all but anti-depressants and for atypical antipsychotics.  This proposal was rejected.

  3. No Changes in Who is Eligible for Managed Long Term Care - final budget rejects proposal to exclude from MLTC people who, without home care, would not otherwise need to be in a nursing home.  Advocates were concerned that the local  county and HRA Medicaid programs had downsized their Medicaid personal care staff so lacked the resources to assess and authorize personal care services

  4. Compromise Reached in Provider Reimbursement Rates for Qualified Medicare Beneficiary (“QMB”) and Medicaid recipients who are members of Medicare Advantage Plans - Medicare beneficiaries who rely on Medicaid or "QMB" to pay the copayments charged by their Medicare Advantage Plans will now have 85% of the copayment paid for them.  This is better than what the Governor proposed - which was that NONE of the copayment or coinsurance would be paid for them if the Medicaid rate was lower than the Medicare rate for the service, which is usually the case. This would have deterred doctors and other providers from being willing to treat them.  Unfortunately, the budget does not change the cut enacted last year in 2015, which cuts the help provided to Medicaid and QMB recipients who have Original Medicare, rather than Medicare Advantage.  They get no help at all with the 20% coinsurance they are charged for Medicare Part B services, if the Medicaid rate is lower than the Medicare rate for the service.  While providers are banned from "balance billing" QMB beneficiaries for that coinsurance, the reality is that the beneficiaries are still hurt when their provider is not paid.

Here is an example to illustrate the proposal and the final budget provision. 

The Medicare rate for Mary's specialist visit is $200, of which her Medicare Advantage plan pays $150 and Mary is charged a copayment of $50. The Medicaid rate for the same service is $150. 

  • FINAL NYS BUDGET:   Medicaid will pay the specialist 85% of the $50 copayment, which is $42.50. The doctor is prohibited by federal law from "balance billing" QMB beneficiaries for the balance of that copayment.  Since provider is getting $192.50 of the $200 approved rate, provider will hopefully not be deterred from serving Mary or other QMBs/Medicaid recipients.
  • PROPOSED budget (rejected):  Medicaid would not pay specialist ANY part of the $50 copayment since the Medicaid rate for the service is less than the Medicare rate.  Medicaid would view the doctor as already paid in full.  This would have deterred doctors and other providers from being willing to treat dual eligibles and people with QMB.
  1.  Managed Care Assistance Program (MCCAP) funding preserved -  Funding for this important program that funds  community-based organizations throughout New York State, including NYLAG, to assist Medicare and Medicaid beneficiaries with Medicare Part D and access to subsidies for low-income Medicare beneficiaries was preserved.  See this blog by NYLAG advocate Paula Arboleda describing this successful program.  

Losses - No progress was made on restoring some previous cuts and restrictions --

  1. Medicaid Physical, Occupational & Speech Therapy Visit Caps  - In 2011, the state budget limited Occupational Therapy, Physical Therapy and Speech Therapy/Pathology to 20 visits per year. This is a flat limit on services, with no override allowed.  The  limits do not apply to people with developmental disabilities or traumatic brain injury, but apply to all other Medicaid recipients, including those who access these therapies through Managed Long Term Care and managed care plans.  These limits continue to deprive Medicaid recipients of crucial rehabilitation services and should be removed. 

  2. Essential Plan still not open to all PRUCOL Immigrants - about 5,500 immigrants  Permanently Residing Under Color of Law (PRUCOL), such as those with deferred action for childhood arrivals (DACA) status, are banned from the Essential Plan, leaving them uninsured if their income is above 138% of the Federal Poverty Line (FPL).  Expanding the Essential Plan to cover these immigrants would give them access to affordable insurance if their incomes are up to 200% of the FPL.  This expansion was rejected. 

Still Studying - Minimum wage requirements enacted, as to how they will impact the Medicaid home care industry.  While increases in minimum wage of this vital workforce are much needed, the big question is how will they be funded for Medicaid services.  These changes come on the heels of the new overtime requirements that home care aides are entitled to overtime pay when they work over 40 hours per week, as mandated by federal changes that became effective in October 2015.   While some funding allocation is being passed through the MLTC plans to the home care agencies and CDPAP fiscal intermediaries, the Consumer Directed Personal Assistance Association and other organizations say the funding is not nearly enough, forcing aides and consumers to suffer when hours are cut back to avoid overtime.  


ORIGINAL GOVERNOR budget proposals can be found here.  The actual language of the proposed budget bills can be found here -- Health and Mental Hygiene (HMH) Bill with the Memorandum of Support here.

NYLAG and other organizations have submitted testimony opposing some of the proposals in the budget:

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