THE STATE BUDGET HAS OFFICIALLY BEEN PASSED.

AND AS WE DISCUSSED LAST WEEK, ONE OF THE BIGGEST ASPECTS OF THE BUDGET IS THE FUNDING TO MEDICAID.

THIS YEAR'S BUDGET INCLUDED SAVINGS FOR THE PROGRAM BY WAY OF CUTS TO THE CONSUMER DIRECTED PERSONAL ASSISTANCE PROGRAM.

THAT MOVE SPARKED PUSHBACK FROM ADVOCATES AND LAWMAKERS.

WE SAT DOWN WITH PATRICK ORECKI, OF THE CITIZENS BUDGET COMMISSION,TO UNDERSTAND WHY MEDICAID CONTINUES TO HAVE SO MUCH INFLUENCE OVER THE BUDGET PROCESS.

HERE'S THAT CONVERSATION.

THANK YOU SO MUCH FOR JOINING US TODAY, PATRICK.

THANKS FOR HAVING ME.

NOW, I WANTED TO START ON MEDICAID, THE STATE BUDGET PROVIDED SAVINGS TO THE MEDICAID PROGRAM BY WAY OF THE CUTS TO THE CONSUMER DIRECTED PERSONAL ASSISTANCE PROGRAM, THERE WERE A LOT OF OPPOSITION FROM ADVOCATES AND LAWMAKERS IN THE FINAL DAYS OF THE BUDGET NEGOTIATION.

SO, WHAT IS THE COMMISSION'S PERSPECTIVE ON THESE CUTS?

YEAH, WELL, MEDICAID IS THE SINGLE LARGEST PROGRAM IN THE STATE'S BUDGET, SO IT'S ALWAYS GOING TO BE A SOURCE OF BIG NUMBERS ON SAVINGS AND ON NEW SPENDING, SO IT'S SOMETHING WE'RE SUPER FOCUSED ON, AND ESPECIALLY THE CDPAP, THE CONSUMER DIRECTED PROGRAM, BECAUSE IT'S A PROGRAM THAT'S GROWING AT A PRETTY ASTRONOMICAL RATE, YOU KNOW, A FIGURE THAT GETS THROWN AROUND A LOT IS OVER 1,200% OVER THE LAST DECADE, WHICH IS A HUGE AMOUNT OF GROWTH.

AND THE IMPLICATION FOR THE BUDGET THEN IS THAT YOU'RE GROWING AT A RATE THAT'S NOT SUSTAINABLE OVER THE LONG TERM FOR THE STATE, AND/OR CROWDING OUT SPENDING IN OTHER PRIORITY AREAS OF THE BUDGET, SO.

IT'S SOMETHING THAT I THINK IS GETTING DUE CONSIDERATION.

AND AS SOMEONE WHO HAS WORKED IN THE STATE BUDGET OFFICE, AND HAS SPECIFICALLY FOCUSED ON MEDICAID, CAN YOU HELP US UNPACK WHAT GOES INTO THE DECISION MAKING PROCESS WHEN IT COMES TO THE MEDICAID PROGRAM IN RELATION TO THE BUDGET?

YEAH, AGAIN, SINCE IT'S KIND OF NUMBER ONE WITH THE BULLET IN THE STATE'S SPENDING PIE, IT'S ALWAYS GOING TO GET A HUGE AMOUNT OF FOCUS, AND THE DIFFICULTY THERE IS THAT YOU HAVE A PROGRAM THAT'S NEARLY $100 BILLION WHEN YOU INCLUDE STATE, LOCAL, AND FEDERAL SPENDING, THAT'S COVERING 6 MILLION NEW YORKERS, ABOUT 1 IN 3 NEW YORKERS IS ON MEDICAID, SO THERE'S HUGE IMPLICATIONS FOR NO MATTER WHAT YOU DO.

BUT MANAGING THAT COST REALLY MAKES OR BREAKS THE BUDGET.

BECAUSE, YOU KNOW, A COUPLE OF PERCENTAGE POINTS DIFFERENCE IN MEDICAID IS A COUPLE BILLION DOLLARS, SO IT MATTERS A LOT.

AND WHEN WE LOOK AT THE FINANCIAL STABILITY OF THE MEDICAID PROGRAM, WHAT SHOULD THE STATE SHOULD OR COULD BE DOING TO ENSURE THAT THIS ISN'T AN ISSUE YEAR AFTER YEAR?

YEAH, I THINK IT'S ALWAYS GOING TO BE AN ISSUE YEAR AFTER YEAR.

UH HUH.

IT'S A MATTER OF BEING PROACTIVE AND LOOKING LONG TERM, SO THE THING THAT WE'VE BEEN FOCUSING ON, FOR EXAMPLE, GOING FORWARD UNDER THE GOVERNOR'S PROPOSAL, STATE SHARE MEDICAID SPENDING WAS SLATED TO GO UP ABOUT 7% ANNUALLY GOING FORWARD, THAT'S A HUGE RATE OF SPENDING GROWTH, FRANKLY, THE TAX BASE DOESN'T GROW AT 7% MOST YEARS.

SO IF YOU HAVE YOUR BIGGEST PROGRAM GROWING AT 7%, AGAIN, YOU'RE CROWDING OUT OTHER THINGS OR YOU'RE OPENING UP BUDGET GAPS THAT YOU HAVE TO DEAL WITH SOMEHOW.

KIND OF THE BIG CONCERN FOR US IS THAT THAT IS 7% WITH THE PROPOSED SAVINGS THAT THE GOVERNOR PUT FORWARD.

UH HUH.

SO THE FACT THAT MOST OF THOSE WERE NEGOTIATED OUT AND IN FACT A LOT OF NEW SPENDING WAS ADDED, MEANS THAT RATE OF SPENDING GROWTH IS GOING TO BE EVEN HIGHER IN WHATEVER THE ENACTED FINANCIAL PLAN LOOKS LIKE, WHICH WE DON'T HAVE YET, BUT THE CONCERN IS HOW SUSTAINABLE IS THAT OVER THE LONG TERM?

7% OR MORE, FRANKLY, IS PROBABLY NOT.

ARE THERE ANY UNTAPPED OR UNDERUTILIZED RESOURCES THAT THE STATE SHOULD BE USING TO HELP WITH SAVINGS FOR THE PROGRAM?

YEAH, I THINK, YOU KNOW, THEY'RE FOCUSING ON THE RIGHT THINGS, THE AREAS THAT ARE GROWING REALLY EXTRAORDINARILY FAST, LIKE PERSONAL CARE AND HOME CARE SERVICES.

MAKING SURE THAT THOSE ARE TARGETED TO THE EXACT PEOPLE THAT NEED IT THE MOST.

BECAUSE THERE IS OBVIOUSLY A NEED.

AND A GROWING NEED.

BUT THERE ARE WAYS TO MANAGE THE COSTS AND FIND SOME SAVINGS AS WELL.

I THINK THE OTHER THING TO THINK ABOUT IS THE HOSPITALS LANDSCAPE, WHICH IS CRITICALLY IMPORTANT, AGAIN, SOME HOSPITALS ARE TRULY ABSOLUTELY STRUGGLING, HAVE BEEN FOR A LONG TIME AND THE STATE DEVELOPING A PLAN, WHICH I THINK THEY'LL HOPEFULLY DO IN ERNEST THIS YEAR, FOR HOW TO MAKE THOSE FINANCIALLY SUSTAINABLE OVER THE LONG TERM IS ANOTHER KEY THING.

AND WE KNOW THE STATE BUDGET PROVIDED $3.2 BILLION TO SUPPORT THOSE DISTRESSED HOSPITALS, A LOT OF THAT MONEY WILL COME FROM THE 1115 WAIVER SO DO YOU THINK THAT AMOUNT IS ENOUGH TO HELP THE 29% OF NEW YORK HOSPITALS THAT ARE CURRENTLY FACING FINANCIAL DIFFICULTY?

YEAH, I THINK, YOU KNOW, PART OF THAT IS AN UNANSWERED QUESTION AT THIS POINT.

ONE OF THE THINGS THAT WE'RE LOOKING AT, TOO, IS THE COMMISSION THAT THE GOVERNOR RECENTLY CONVENED AT THE END OF LAST YEAR.

UH HUH.

THE COMMISSION ON THE FUTURE OF HEALTHCARE AND HOPING THAT THEY DO SOME OF THE WORK AND PUBLISH THE RESOURCES WE NEED TO BE ABLE TO ANALYZE THE SCOPE AND THE SIZE OF THAT PROBLEM, WHICH IS ABSOLUTE I THINK THE POSITION THAT THE STATE'S BEEN IN FOR MANY YEARS IS SORT OF GOING FROM ALMOST TRIAGE TO TRIAGE, ON THE RIGHT.

FINANCIALLY DISTRESSED HOSPITAL SITUATION.

COMING UP WITH NEW PROGRAMS, NEW SUPPLEMENTAL PAYMENTS, THINGS LIKE THAT, THAT GET THROUGH IT A YEAR OR TWO, BUT WE REALLY NEED TO HAVE KIND OF A LONG TERM COMPREHENSIVE VIEW AT HOW TO MAKE SURE THESE HOSPITALS ARE FINANCIALLY SUSTAINABLE AND DELIVERING THE SERVICES THAT ARE NEEDED.

AND WHEN IT COMES TO THAT COMMISSION, WHAT GUARDRAILS OR BENCHMARKS SHOULD BE PUT IN PLACE TO ENSURE THAT THEY'RE COMING UP WITH THE BEST RECOMMENDATION FOR THE STATE?

YEAH, I THINK FIRST OF ALL, SPEED IS ABSOLUTELY CRITICAL, SO WE KNOW THAT THE INTENT IS TO HAVE THEM ISSUE THEIR FIRST SET OF RECOMMENDATIONS BY THE END OF THIS YEAR TO INFORM NEXT YEAR'S BUDGET, I THINK THAT MAKING SURE THAT DEADLINE IS MET IS ABSOLUTELY IMPORTANT.

ANOTHER THING WE WOULD LIKE TO SEE FROM THE COMMISSION, BUT ALSO FROM THE DEPARTMENT OF HEALTH AND THE MEDICAID PROGRAM, MORE BROADLY, IS MUCH GREATER TRANSPARENCY.

SO, OF COURSE, WE ALL WANT TO COME UP WITH WHAT THE MOST EFFECTIVE AND EFFICIENT SOLUTIONS ARE IN THE MEDICAID PROGRAM, WE CAN'T DO THAT WITHOUT THE DATA AND THE RESOURCES TO ACTUALLY ANALYZE THE PROBLEM AND COME UP WITH THE BEST SOLUTION.

SO I THINK THE COMMISSION SHOULD BE VERY TRANSPARENT, PUBLISH THEIR WORK, PUBLISH THE DATA THAT THEY USE, BUT THE DEPARTMENT OF HEALTH SHOULD DO SOME OF THAT AS WELL, REALLY IMPROVE THAT.

AND DO YOU THINK THAT THE DEPARTMENT OF HEALTH HAS BEEN RECEPTIVE TO THE NEED FOR TRANSPARENCY?

I THINK THE COMMISSION SHOWS THAT THEY ARE INTERESTED IN IT AND MAYBE PRIORITIZING IT.

BUT WE NEED TO SEE SOME FOLLOW THROUGH NOW.

YEAH.

AS AN EXAMPLE, LAST YEAR, THERE WAS LEGISLATION THAT WOULD HAVE REQUIRED DOH TO PUBLISH MORE DATA ON HOME CARE AND PERSONAL CARE SERVICES, WHICH WE SUPPORTED, PASSED WITH FLYING COLORS THROUGH THE LEGISLATURE, WAS VETOED ON THE BASIS OF HAVING A BIT OF A COST.

BUT WE THINK THAT IT'S SOMETHING THAT THE STATE SHOULD BE DOING NOT ONLY FOR HOME CARE DATA, BUT MEDICAID ACROSS THE BOARD.

AND WE KNOW THAT MEDICAID SPENDING SORT OF BALLOONED THROUGH THE COURSE OF THE PANDEMIC.

SO IS THERE ANYTHING THAT THE STATE SHOULD BE DOING IN TERMS OF PROACTIVE MEASURES SHOULD THERE BE ANOTHER EMERGENCY HEALTH SCARE OR ANOTHER PANDEMIC?

YEAH, YEAH, YOU KNOW, ONE OF THE REASONS THAT COSTS REALLY EXPLODED DURING THE PANDEMIC, TOO, IN THE MEDICAID PROGRAM, WAS THAT A LOT OF PEOPLE ENROLLED INTO MEDICAID.

THEY HAD LOST JOBS AND SO THEY MOVED INTO MEDICAID.

AND STAYED THERE UNDER FEDERAL LAW CHANGES THAT HAPPENED.

RIGHT.

A LOT OF THOSE PEOPLE HAVE SINCE MOVED OUT, SO THE COST WILL COME DOWN TEMPORARILY.

BUT THAT LONG TERM TRAJECTORY GOING FORWARD IS A THING THAT REALLY IS A CONCERN.

AND THE STATE BUDGET ALSO INCLUDED REIMBURSEMENT FOR HOSPITALS, AND NURSING HOMES, THERE WERE A LOT OF OPPOSITION FROM LABOR UNIONS WHO SAID THAT, YOU KNOW, THAT AMOUNT THAT THE STATE IS PROPOSING WON'T NECESSARILY BE ENOUGH TO COVER THAT COST, SO WHAT IS THE COMMISSION'S POSITION ON THAT?

SURE, I THINK THAT IT'S IT'S RECOGNIZING THAT NOT EVERY INSTITUTION OR EVERY PROVIDER'S SITUATION IS THE SAME.

SO WHEN YOU MENTIONED FINANCIALLY DISTRESSED HOSPITALS OR SAFETY NET HOSPITALS, THEIR BOOKS LOOK COMPLETELY DIFFERENT THAN A MUCH BETTER OFF HOSPITAL AND THEY'VE BEEN A CONCERN FOR A LONG TIME, AGAIN, THE STATE'S KIND OF PAPERED ITS WAY THROUGH.

BUT THAT UNIVERSE OF SEVERELY FINANCIALLY DISTRESSED HOSPITALS HASN'T CHANGED AND THE NEED FOR A COMPREHENSIVE SOLUTION THERE IS ABSOLUTE.

BUT AGAIN, YOU CAN'T PROVIDE THE SAME, YOU KNOW, DOLLAR SUPPORT AND SUPPLEMENTAL PAYMENTS FROM THE STATE TO EVERY HOSPITAL BECAUSE IT'S JUST NOT FINANCIALLY SUSTAINABLE.

AND NOW THAT THE STATE BUDGET HAS BEEN PASSED, WHAT ARE SOME OTHER HEALTHCARE INITIATIVES THAT THE COMMISSION IS GOING TO BE CLOSELY WATCHING THROUGH THE REST OF THE LEGISLATIVE SESSION AND THE YEAR?

YEAH, ONE THING THAT WE'RE REALLY KIND OF EAGER TO SEE DETAILS ON AND CONCERNED ABOUT AS WELL IS THE PROPOSED REVENUE RAISER FOR THE MEDICAID PROGRAM AS WELL.

IT'S A TAX ON THE BOOKS BUT IT'S REALLY A WAY OF THE STATE TRYING TO GET MORE FEDERAL SUPPORT.

OUR CONCERN THERE IS THAT IT MIGHT ONLY LAST FOR A COUPLE OF YEARS IF IT'S RECOGNIZED AT ALL AND AS SOON AS THAT MONEY GOES AWAY IN THREE OR FOUR YEAR'S TIME, THE STATE WILL HAVE A HOLE IN THE MEDICAID BUDGET THAT IT CAN'T SUSTAIN.

SO WHAT WE'RE LOOKING AT WITH THAT WITH THE COMMISSION ON THE FUTURE OF HEALTHCARE, WITH THE DATA TRANSPARENCY IS THE STATE KIND OF HAVING A MORE ABSOLUTE TRANSFORMATIVE PLAN RATHER THAN THESE ARE THE RESOURCES TO GET US THROUGH NEXT YEAR, WE CAN, YOU KNOW, MUDDLE OUR WAY THROUGH A COUPLE OF MORE YEARS WITH THESE RESOURCES, BUT IN A COUPLE OF YEARS TIME, WE'RE GOING TO BE BACK TO THE DRAWING BOARD AGAIN.

SO HOPEFULLY AVOIDING SOME OF THAT.

WELL THERE'S CERTAINLY A LOT TO LOOK FORWARD TO, WE'LL HAVE TO HAVE YOU BACK ON THE SHOW, BUT UNFORTUNATELY THAT'S ALL THE TIME WE HAVE FOR TODAY.

THANKS SO MUCH FOR JOINING US.

THANKS FOR HAVING ME.

AND WE WERE SPEAKING WITH PATRICK ORECKI, DIRECTOR OF STATE STUDIES FOR THE CITIZENS BUDGET COMMISSION.

AND AS PATRICK UNDERSCORED, THE REALITY IS SO MANY NEW YORKERS RELY ON MEDICAID.

SO FUNDING FOR THE PROGRAM WILL LIKELY CONTINUE TO BE A BIG PORTION OF THE STATE'S BUDGET IN THE YEARS TO COME.

YOU CAN FIND MORE INFORMATION ON STATE FUNDING FOR MEDICAID AND OTHER HEALTHCARE INITIATIVES ON OUR WEBSITE.

THAT'S AT NYNOW.ORG.