News from Assembly Minority Leader Brian M. Kolb
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For Release: IMMEDIATELY, October 7, 2011
Doug Finch (315) 781-2030
New York's Medicaid Program Is Nation's Costliest And Is Pushing Local Budgets To The Breaking Point
Legislative column from Assembly Minority Leader Brian M. Kolb (R,I,C-Canandaigua)

Go ahead and ask any local elected official the following question: "What is the single biggest unfunded mandate that Albany imposes on municipal budgets?" Ten times out of ten, you will receive a one-word answer: Medicaid. New York's Medicaid program has ballooned into America's most expensive and its runaway costs are pushing many localities to the brink of fiscal insolvency. Without question, we need real solutions to reform New York's Medicaid program, reduce costs, increase efficiency and save taxpayer dollars.

MEDICAID PROGRAM STARTED WITH THE BEST OF INTENTIONS

Enacted July 30, 1965, through Title XIX of the Social Security Act as part of President Lyndon Johnson's "Great Society," Medicaid has become America's major public health coverage program. Medicaid finances health and long-term care services for over 55 million people, including low-income families, people with disabilities and the elderly. Medicaid should not be confused with Medicare, which is the federal health care program for persons 65 and older.

Medicaid is jointly funded through federal, state government, with the federal financing share constituting approximately 50 percent of all program spending. Here in New York, state and local governments actually share in the program's cost. The state share of Medicaid is approximately 35 percent, while the local share amounts to roughly 15 percent. However, even though localities shoulder a significant portion of Medicaid's hefty price tag, they have virtually no say in how the program is administered, which is a classic example of an unfunded mandate!

AS NEW YORK'S MEDICAID PROGRAM HAS GROWN, COSTS TO TAXPAYERS HAVE SKYROCKETED

Since the program was launched, New York's Medicaid costs have steadily risen to the highest in America. In fact, state Medicaid spending is now 69 percent more per beneficiary than the national average. This explosive growth is why Medicaid was cited by the New York State Association of Counties as the largest of nine State unfunded mandates that consume 90 percent of County budgets and contributes to our having America's second highest combined state-local tax burden. New York's Medicaid expenditures have soared due to several factors including our state's above average share of elderly and disabled residents, higher costs for healthcare practitioners and excessive compliance costs caused by state regulations.

Another reason - a very big one - for our state's nation-leading Medicaid expenditures is New York's generous income eligibility levels and extensive optional services that other states do not provide. All of this contributes to the hefty Medicaid price tag Albany imposes on localities.

FACTS ABOUT NEW YORK'S MEDICAID PROGRAM COSTS

Just how out of control is New York's Medicaid spending? Try this on for size: New York spends more than Texas and Florida combined, according to the Kaiser Family Foundation. The combined population of Texas and Florida is 43,948,871 (Texas has 25,145,561 residents, Florida, 18,803,310), while New York's population is over 19 million, meaning we spend more than Texas and Florida together, even though we have nearly 24 million less residents!

Clearly, such levels of Medicaid spending are unsustainable. Albany must take immediate action to reduce this program's crushing costs on localities and taxpayers.

REAL SOLUTIONS TO REDUCE MEDICAID COSTS

The following are just a few of the legislative and administrative solutions I am supporting with an eye toward reducing Medicaid costs, reforming the program, protecting local budgets and saving taxpayer dollars. If Albany moves forward with these solutions, we have taken a large step toward making New York's Medicaid program less costly and more effective:

As always, constituents wishing to discuss this topic or any other state-related matter should contact my district office at (315) 781-2030, or e-mail me at kolbb@assembly.state.ny.us.


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