New York and United States Government Finalize $8 Billion Medicaid Agreement

Governor Andrew Cuomo signed the 2014-2015 New York state budget last Monday night, which featured a tax cut for state residents. A week later, Cuomo and legislators finalized an $8 billion Medicaid agreement with the federal government.

New York will reinvest $8 billion of federal money in its health insurance system to help improve health care for low-income people. This reinvesting helps both taxpayers and those receiving Medicaid, especially since New York's spending on Medicaid is among the highest in the United States.

"This waiver amendment allows us to invest these savings in keeping Brooklyn's hospitals open, providing new community based primary care clinics in neighborhoods that need them and preserving health care services across our state," Cuomo said in this Yahoo! News article.

Additionally, the state will save more than $17 billion once the 2014-2015 fiscal year comes to an end. Numbers from 2010 show that New York state spent $8,910 per patient compared to the national average of $5,563 and in 2011 their costs totaled $15.1 billion, according to this Reuters news article.

The Medicaid Redesign Team (MRT) helped allow New York's transformation of their Medicaid program. Over the next five years New York will keep the federal savings it makes and will reinvest it to bolster the program. The Medicaid 115 waiver amendment will allow the state to implement the MRT action plan.

The plan will drive down costs for taxpayers and improve health care Medicaid patients. One of the highlights of the MRT action plan is the implementation of the Delivery System Reform Incentive Payment (DSRIP) program. This program hopes to achieve a 25% reduction in avoidable hospital use over the five years the plan is in action. The DSRIP is intended to essentially micro-manage the state's Medicaid system, by promoting community-level collaborations as well as focusing on system reform.

You can read more about New York's Medicaid situation on the state's Department of Health website and in this Wall Street Journal article.