January 14, 2020
NY Nursing Homes Face Reimbursement Cuts

Overnight Medicaid cuts take $124M from New York nursing homes

How the Cuomo administration is managing debt through LTC NY Nursing Homes

As millions of Americans look forward to a prosperous new year, nursing home operators in New York have to worry about reimbursement changes threatening their bottom line.

Starting on January 1, 2020, Governor Cuomo instituted a statewide Medicaid payment cut of 1%. Amounting to roughly $124M this year alone (accounting for federal matching funds), the number represents a drop in the bucket compared to New York State’s estimated $6B budget deficit.

“This reduction in spending growth was approved by the Legislature as part of the FY 2020 budget,” said spokeswoman Erin Hammond. “[It] is being implemented in the fourth quarter of the State’s fiscal year as the Department of Health works with its partners to develop an overall plan to reduce Medicaid spending growth while continuing to provide high-quality care to over 6 million New Yorkers.”

Readying For Reduction

Despite Cuomo’s aggressive approach to reducing the deficit, economists say the announced Medicaid cuts will do very little to curb the state’s greater debt problem.

On top of the 1% reduction, the current administration also hinted at plans for a Medicaid savings program designed to shrink spending by $1.8B this year. Details remain under wraps until the official FY 2020 New York State Budget is published later in January.

While nursing homes, hospitals, doctors, pharmacists and other care providers stand to lose under the measure, industry gurus say the state’s goal is to slow growth (not reverse it). Overall Medicaid expenditure is still expected to increase over the next 12 months.

Cuomo’s cuts will also affect CDPAP providers. Reimbursement revisions are currently in the works aſter last year’s changes were deemed unconstitutional. Of the 6 million New Yorkers covered by Medicaid, roughly 75,000 seniors and disabled individuals depend on CDPAP for at-home self-directed care.

As Cuomo grapples with the growing deficit, stay confident and compliant heading into the new year. SpecialtyRx continues to innovate new methods for delivering maximum savings to our long-term care partners.