Pataki Presses Action on Health Care Package

New York Gov. George Pataki (R) is asking state lawmakers to act quickly on his proposed fiscal year 2002-03 health care budget, which would increase Medicaid reimbursement to providers but would also cut several programs, the New York Times reports. Pataki wants the more than $30 billion package in place before he presents his overall 2002-03 budget proposal -- a "sharp departure from tradition" that would, if successful, "take health care out of the coming election-year budget talks, in which the state will have to close a multibillion dollar deficit." The proposal, to be phased in over three years, includes new or expanded programs totaling more than $600 million a year, while calling for program cuts that could total $200 million per year by 2004-05. The package would be financed in large part by a "one-time infusion" of $1 billion the state will receive from the conversion of Empire Blue Cross and Blue Shield to a for-profit company -- a deal that still needs to be approved by lawmakers -- and by an increase in the per-pack cigarette tax from $1.11 to $1.50. It also relies on a $750-million-a-year increase in federal Medicaid funding, congressional approval of which is "seriously in doubt," state and federal officials said. Some of the details of the plan, which could be voted on as early as today, include:

• Medicaid reimbursements to hospitals, nursing homes and home care providers would increase by more than $300 million a year, allowing them to increase wages for workers.
• A fund that helps cover large malpractice claims against doctors would be replenished, and breast and cervical cancer screening programs would receive more money.
• Pharmacies serving beneficiaries in either Medicaid or the state's Elderly Prescription Pharmaceutical Coverage program would see their payments reduced by $100 million a year.
• Subsidies for part-time health clinics would be cut 35%.

Hospital Raises
A central component of Pataki's plan is helping New York hospitals and nursing homes boost their retention and recruitment of workers (Perez-Pena, New York Times, 1/12). "Over a three-year period, [the proposal] distributes the resources statewide to hospitals, nursing homes and personal care agencies to hire, recruit and retain quality staff," Robert Hinkley, the state deputy health commissioner, said (Mahoney, New York Daily News, 1/13). On Friday, 1199/SEIU, New York's Health and Human Services Union, reached an agreement with 67 New York City hospitals and nursing homes for a 13% pay raise over 42 months for 55,000 of the union's members, the Times reports. Hospital executives and union officials said the settlement was made possible by state aid that Pataki has included in his health care package (Greenhouse, New York Times, 1/12).

Fiscal Gimmickry?
Both the substance and the politics of Pataki's proposal have generated controversy throughout the state. Assembly Speaker Sheldon Silver (D), for instance, said that Democrats were "just not interested" in cutting prescription drug reimbursements (Dicker/Lovett, New York Post, 1/14). And gubernatorial candidate Carl McCall (D), the state's comptroller, said that the aid to the hospitals for worker wage increases "looks and smells like a political deal" to win favor with Dennis Rivera, the politically influential head of the health and human services union (Dicker, New York Post, 1/13). Some Democrats would also like a portion of the money from the Empire Blue Cross and Blue Shield conversion to go toward helping reduce the number of uninsured (Perez-Pena, New York Times, 1/12). A New York Times editorial calls Pataki's plan to use the one-time payment from the conversion the "largest fiscal gimmick in New York State history," as programs in his proposal will "cost hundreds of millions annually after this 'one shot' of money is long gone" (New York Times, 1/14).