ALBANY — Advocates for New York’s nursing homes and long-term care facilities pleaded Tuesday for a 20% increase in the state’s Medicaid reimbursement rate, citing worsening staffing shortages and state mandates they said have set those facilities up for failure.
“The ‘hands-on’ staff our members have managed to keep are now overworked and burned out,” said Stephen Hanse, president of the New York State Health Facilities Association, a group that represents long-term care providers He added: “As such, providers are in imminent danger of losing them to other industries.”
In her proposed state budget, Gov. Kathy Hochul is offering a 5% increase in the state reimbursement rate for Medicaid. But representatives of a slew of hospital and health care associations said medical establishments need a higher reimbursement rate to avoid financial calamities.
Advocates also cited demographic trends in New York to make the case the state should correspond with the reality that its population of residents age 65 and older is surging.
James Clyne Jr., president of LeadingAge New York, representing more than 400 providers of long-term care services, said demand for such services is about to surge as the population of adults age 85 and older doubles by 2040.
“Alarmingly, while the percentage of our population over age 65 is growing, the percentage of working-age adults to care for them is shrinking,” Clyne told lawmakers.
For the healthcare industry, Medicaid reimbursement rates are crucial to the bottom line.
Clyne noted Medicaid pays for more than 70% of nursing home days and over 80% of home care services in New York.
“Yet, New York’s Medicaid reimbursement for LTC (long term care) has failed miserably to keep pace with rising costs,” he said, noting rates paid to such services as nursing homes, assisted living programs and adult day health care programs have not seen reimbursements adjusted for inflation in the past 15 years, while inflation has climbed by more than 40% in that period.
On another Medicaid front, some lawmakers are already criticizing a Hochul proposal that would allow the state to intercept more than $600 million in federal Medicaid funds from county governments.
Sen. Steven Rhoads, R-Long Island, called the Hochul plan “disgraceful,” telling New York State Medicaid Director Amir Bassiri it will force county governments to raise property taxes on homeowners.
Bassiri defended the proposal, noting counties have not had any responsibility for determining Medicaid eligibility since 2020.
“For the last three years, they have not had to dedicate any resources towards Medicaid administration,” he said at the budget hearing. “They’ve actually repurposed those staff to deal with other county needs while the state has reimbursed their Medicaid reimbursement at the current rate that we pay.”
Later Tuesday, leaders of the New York State Association of Counties stepped up their efforts to derail the Medicaid funding shift away from counties, branding their campaign “Cost Shift Countdown,” alluding to the fact the state budget is due to be completed by April 1.
“Our message to state legislators is simple: Don’t come home from Albany on April 2nd with a budget that shifts $625 million in new costs to our local taxpayers,” said Clinton County Administrator Michael E. Zurlo, now serving as president of NYSAC.
Zurlo went on to say in a statement that the Hochul proposal “would represent the largest single-year cost shift to local taxpayers in decades and return New York to the bad old days of out-of-control property tax increases to pay for the state’s Medicaid program.”
NYSAC leaders said they are trying to get Hochul to reconsider the proposal.
“In 2011, the state made a deal with local governments that said, ’You can’t raise property taxes more than 2% a year, but to make that possible, we’ll cover any increases in the cost of Medicaid,’” NYSAC Executive Director Stephen Acquario said in a statement.
“Counties kept our end of the bargain and held property tax increases in check, but now the state is shifting billions of dollars of new Medicaid costs onto counties over the next several years,” Acquario added.