New York will receive an $8 billion Medicaid waiver from the federal government that will stave off cuts in programs and services, Gov. Andrew Cuomo announced today.
The agreement is less than the state wanted. New York had been seeking a $10 billion waiver since August 2012, but Cuomo said the $8 billion will help avoid reductions in spending at health-care facilities, particularly some New York City hospitals that faced closure.
“While the state will be reviewing the terms and conditions of this agreement, it is clearly the biggest step forward towards a positive conclusion for our communities, particularly in Brooklyn, that have suffered from diminishing health care services,” Cuomo said in a statement.
The waiver is for five years and allows New York to keep a share of its Medicaid savings through cost reductions in recent years. The savings will be used to fund health-care programs.
Cuomo’s $137 billion budget proposal for the fiscal year that starts April 1 doesn’t rely on the funds to balance the books, but state officials said the money would be used in addition to the state’s original spending plan.
For example, the money from the Medicaid waiver can only be used on specific programs, such as expanding primary care and assisting hospitals in poor areas. New York spends more than $50 billion a year on Medicaid, the health insurance program for the poor and disabled.
State health officials indicated last month that several financially struggling hospitals, particularly three in Brooklyn, would face closure without the waiver. They also mentioned that St. Francis Hospital and Health Center in Poughkeepsie was in peril.
Saint Francis Hospital CEO Art Nizza told Gannett’s Albany Bureau last month that the waiver would “would benefit hospitals around the state,” but couldn’t “speculate about the specific impact” on St. Francis since the hospital is in bankruptcy.
Sen. Charles Schumer hailed the agreement.
“It’s not everything New York asked for, but it is a generous amount,” Schumer said in a statement. “This large amount of money should help all of New York – both upstate and downstate — with both its budgetary challenges and hospital needs.”