Winner: Cap On Local Medicaid Costs On The Way

George Winner

March 25, 2005

Albany, N.Y.

-- "It’s a great credit to the efforts of county leaders locally and across New York State who kept up the drumbeat for local Medicaid relief," State Senator George H. Winner, Jr. (R-C, Elmira) said today as the Legislature announced an agreement to begin implementing a cap on local Medicaid costs in the 2005-06 state budget.

Winner said that additional details of a comprehensive Medicaid reform proposal are still being negotiated, including local accountability and cost containment initiatives, but that all sides have agreed to accept a proposal advanced by Governor George Pataki earlier this year to cap local Medicaid costs.

"The cap on local Medicaid costs will be the highlight of this year’s state budget. It means we will take a significant step toward a future system of financing Medicaid that removes the current burden from counties and local property taxpayers," Winner said.

The Senate has been advocating a proposal advanced by the governor in January that would implement a phased-in cap on county Medicaid expenses. Under the plan, beginning in 2006, county Medicaid costs would be capped at a maximum growth rate of 3.5 percent, which would be permanently lowered to 3 percent by 2008. In 2008, a county would be given the option of remitting to the state the value of their cap or an equivalent amount of sales tax, whichever benefits the county more.

"There’s no overnight cure for out-of-control local Medicaid costs, and it was important for us to recognize state-level fiscal constraints," Winner said. "But a phased-in cap that saves counties meaningful cash, combined with a real commitment to controlling future costs, will be a significant achievement this year. Most importantly, it sets us on a promising and realistic course for additional local relief in the future."

Winner also noted today that both the Senate and Assembly have embraced a plan to accelerate the state’s takeover of all local costs for the Family Health Plus program. A full state takeover is scheduled to commence on January 1, 2006. It will begin this October under the accelerated takeover agreement.

It’s estimated that under the phased-in Medicaid cap, area counties would realize the following savings once the plan is fully effective: Chemung County ($9.6 million); Schuyler ($1.1 million); Steuben ($14 million); Tompkins ($4.8 million); and Yates ($6.2 million).