At long last, Gov. Andrew Cuomo is admitting that the Medicaid mess is a “major problem.” Yes — because he has let it grow that big.
The state is going to kick $2 billion in Medicaid payments into next year’s budget — and will still need to slash its total Medicaid spending by $3 billion over the final four months of the current fiscal year. (That includes $1.5 billion in state funds, plus the loss of $1.5 billion in federal matching aid.)
The Empire Center’s Bill Hammond has been warning for months about this ticking time bomb. As he notes, it’s been snowballing as the gov has kicked ever-larger amounts of Medicaid outlays into the next year, starting with a minor $50 million delay in 2014.
Cuomo’s motive, in part, has been to make it seem like the program’s growth is meeting the “global cap” he pushed through back in 2011. In other words, he’s been end-running his own fiscal-responsibility measure.
He and the Legislature have also exempted more and more parts of the program from the cap — notably, to allow for higher pay for health-care workers, especially those repped by the potent 1199 union.
Despite the growing gap, last year he also ordered a costly increase in Medicaid payouts to hospitals and nursing homes — just months after the Greater New York Hospital Association quietly gave $1 million to the state Democratic Party.
As Hammond notes, “The burgeoning Medicaid deficit is entirely driven by higher-than-expected spending, not a shortfall of revenue.”
The special interests that have grown fat from that spending boom will explode over the billions in cuts that are about to hit — and that won’t be the end, since next year’s Medicaid gap is set to be over $4 billion.
In the end, kicking the can almost always guarantees a world of pain.