ALBANY — New York’s county governments are calling on state lawmakers to derail proposed Medicaid program changes they fear would result in hefty property tax hikes for homeowners and businesses.
The counties say a package of Medicaid initiatives will saddle their governments with $1.5 billion in new aggregate costs.
The counties are specifically seeking to block Cuomo’s proposal that each county adheres to a 3% limit on any increase in local Medicaid spending or refund any amount above that to the state.
“Counties oppose all efforts to undo the local Medicaid caps that have helped counties stay under the tax cap and save local taxpayers money,” said John F. Marren, the president of the New York State Association of Counties, an umbrella group that advocates for county governments.
“Any state Medicaid proposal must protect local taxpayers and services, and keep the caps in place,” Marren added.
The push to stop or alter Cuomo’s Medicaid plans comes as lawmakers work with the governor to enact a balanced state budget that will have to address a looming $6.1 billion deficit.
Cuomo, who frequently boasts about a series of on-time budgets during his tenure, is hoping a new spending plan will be in place by April 1, when New York begins its next state fiscal year.
In Plattsburgh, Clinton County Administrator Michael Zurlo said the proposed Medicaid alterations could cost his county $1.1 million annually.
County leaders throughout the state, Zurlo noted, hoped the Cuomo administration would shelve the plan before releasing its budget amendments last week, but it remained intact.
“We wanted to see the whole thing stricken” he said. Recent increases in overall state Medicaid spending, Zurlo said, “is certainly not the doing of county governments. Our hope now is that the legislators, in their one house budgets, reject the governor’s proposals.”
The Cuomo administration, however, argued the governor’s policies benefit counties.
“The fact is that the state is shifting over $4 billion in local Medicaid spending this year from localities to the state, easing local government budgets,” said Freeman Klopott, spokesman for the state Division of the Budget. He noted the state authorized $200 million in additional revenue for counties, “easing their burdens further.”
“The state has doubled down on its efforts to control property taxes, making them permanent in the budget enacted in April 2019, and in return for picking up local Medicaid costs we are simply asking local governments to partner with the state to control costs,” Klopott added.
But the counties have no interest in backing Cuomo’s package of Medicaid proposals.
In Cooperstown, Dave Bliss, chairman of the Otsego County Board of Representatives, said his county is “already behind the eight-ball” as it tries to stay within the state’s tax cap while attempting to keep pace with rising costs for personnel and benefits.
“This Medicaid proposal almost guarantees there could be a tax hike of up to 20 percent if it goes through,” Bliss said, noting his county now has the lowest per capita tax levy in New York.
Bliss said he and his county board’s vice chairwoman, Meg Kennedy, recently visited the offices of many state lawmakers in Albany to enlist their opposition to the Medicaid proposals and got a largely sympathetic reception from upstate representatives.
Some six million low-income New Yorkers now get their health care coverage from Medicaid.
Representing Niagara Falls in Albany, Assemblyman Angelo Morinello, a Republican, said the program’s benefits are more generous in New York than what many other states offer.
According to the county association, the potential financial impact to Niagara County from the governor’s Medicaid proposal could range from $921,000 to $8.4 million.
“The counties do not have any control over the costs,” said Morinello in disputing Cuomo’s reasons for realigning the program.
Representing the North Country, Sen. Betty Little, R-Queensbury, also objects to the governor’s Medicaid plans, said her spokesman, Dan MacEntee.
Cuomo has assembled what he calls a Medicaid Redesign team to help the state come up with $2.5 billion in savings in the program. That group is expected to release its recommendations by late March, as lawmakers prepare to review the budget bills legislative leaders and Cuomo will negotiate for the next several weeks.
Several labor groups, including the politically influential New York State United Teachers, are pressing lawmakers to reel in $12 billion in new revenue by imposing higher state income taxes on the estimated 112 billionaires and 46,000 multi-millionaires residing in the state. Republicans oppose higher income taxes, as do some Democrats.
Ron Deutsch, director of the labor-backed Fiscal Policy Institute, has argued that experience has shown that increased surcharges on very wealthy people have not prompted them to relocate to other states.
Bliss said county governments don’t have the income taxing option the state does.
“Cuomo is always saying the wealthy aren’t paying their share,” Bliss said. “This (boosting taxes on the very rich) could be a way to” resolve the Medicaid funding gap.
Joe Mahoney covers the New York Statehouse for CNHI’s newspapers and websites. Reach him at jmahoney@cnhi.com.