State Takeover of Medicaid Administration

New York State Association of Counties (NYSAC) President Thomas J. Santulli (Chemung County Executive) today announced the creation of a county-led commission to transition Medicaid Administration from counties to the State, the first step in the potential State takeover of Medicaid in New York State.“Medicaid is the single largest cost for counties and county property taxpayers in New York,” said Santulli. “We believe the Federal Healthcare Reform Act lays the perfect foundation for a full-blown State takeover of the entire Medicaid program. Let’s take property taxpayers out of the financing equation for the State’s Medicaid program.”New York is the only state in the nation that requires counties to substantially fund the Medicaid program at the local level. Currently counties pay more than $7 billion annually for the State’s Medicaid program, roughly 14% of the total cost of the program. That figure grows by close to $200 million a year.Medicaid is a complicated program in New York State, with expenditures of about $52 billion a year in total funds. Medicaid administrative costs represent less than 2 percent of overall program costs. Currently, each county and the City of New York administer the publicly-funded healthcare insurance program. The recent New York State budget included language directing the State to take over those administrative costs and responsibilities, including the staff, equipment and infrastructure that facilitate this process. “Counties want nothing more than getting out of the Medicaid business once and for all, and we should have never been financing this at the property tax level in the first instance. It’s wrought with inefficiencies,” said NYSAC Executive Director Stephen J. Acquario. “This commission will be empowered to study the county role in this first step of the process and make recommendations to the State Department of Health, which will lead the planning process at the State level.”Among the county-related issues that will be address by the commission include:· The fiscal impact to counties and how it would affect the statutory Cap on the growth of local costs.· Separating Medicaid administrative expenses and functions of workers, managers, attorneys, equipment, rent, and general overhead. In many local jurisdictions a worker performs other social service tasks.· The impact of cross processing of recipients of Medicaid and Food Stamps, there should be some form of agreement reached on how to make sure applications for both programs continue to flow.

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