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2021-22 Executive Health Budget Proposals

Governor Andrew Cuomo on Tuesday released his proposed budget for State Fiscal Year 2022. The Governor has proposed a $192.9 billion budget.

These are some of the Executive Budget proposals impacting the health care sector. You can view all of the proposals in the Executive Budget Briefing Book.

  • Medicaid Program Funding. Total Federal, State and local Medicaid spending, including spending outside the Global Cap, is expected to be $82.9 billion in FY 2022, this includes $48.1 billion in Federal spending and $27.6 billion in State spending (State and Local).
  • Medicaid Global Spending Cap. The Governor proposes to extend the Global Cap through March 31, 2023.  The FY 22 Budget allows for the continued growth within the cap at a rate of 2.9%, for a total cap of $20.57 billion, an increase of $579 million.
  • Medicaid Cuts. Savings in FY 2021 are achieved by reducing premiums, retroactively, to Mainstream Managed Care and MLTC plans based on lower health care utilization due to the pandemic, the use of available balances, and revisions to estimated costs. In FY 2022, savings are mainly achieved from an “across-the-board” Medicaid cut of 1%. The across the board cut would be eliminated if the state receives its request in federal finding.
  • New York State of Health (“NYSOH”). The Executive Budget includes $442 million in total funding for the operation of the NY State of Health in FY 22.
  • Essential Plan. The Executive Budget provides $5.52 billion for the Essential Plan Program.  In addition, the Executive proposes to:
    • Eliminate premiums for Essential Plan coverage for 400,000 New Yorkers earning between $39,300 and $52,400 for a family of four (150%-200% FPL), effectively removing premiums for all EP enrollees.
    • Invest $420 million in rates of payments to insurers who cover Essential Plan enrollees. This rate change will enhance provider reimbursement, which will promote and support access to vital healthcare services.
    • Establish a $200 million Essential Plan Quality Pool to promote high quality of care. These funds strengthen provider networks, incentivize providers based on performance, and ensure provider access for all Essential Plan members.
  • 1115 Waiver. The Executive proposes to both submit an application for an extension to the 1115 waiver and resubmit the 1115 (DSRIP) waiver amendment that was rejected by the prior administration. The new 1115 extension request is for three years and includes the carve out of pharmacy services from managed care to fee-for-service, as well as the state’s transition from an Administrative Services Organization model to a Broker model for non-emergency medical transportation. In addition to a request for a waiver extension, the State is resubmitting its DSRIP waiver amendment that was denied by the Trump administration on February 21, 2020. The State’s revised wavier amendment request will address value based payments, telehealth, workforce, health equity and social determinants of health. The State will also request additional support to assist in its COVID-19 response through this waiver amendment
  • Telehealth. The Executive Budget proposes to expand the scope of telehealth delivery of services through a series of actions, including codifying certain flexibilities previously authorized via Executive Order, such as the authorization of telephonic delivery of services. These measures are anticipated to generate $39.5 million in state savings in FY22 and $58 million in FY 23. Proposals include:
    • Allowing patients to be located anywhere while receiving telehealth services by removing the originating site limitations currently in law;
    • Requiring health plans to offer a telehealth network adequate to meet the telehealth needs of insured individuals;
    • Requiring providers to disclose if they offer telehealth services;
    • Increasing the numbers of practitioners authorized to deliver telehealth services to add Peers and unlicensed practitioners that often offer critical, unique services to those suffering with addiction.
  • Marijuana Regulation. The Executive Budget proposes a comprehensive cannabis regulatory framework administered by the newly established Office of Cannabis Management (OCM) that centralizes all the licensing, enforcement and economic development functions in one entity. The OCM will administer all licensing, production, and distribution of cannabis products in the adult-use, industrial, and medical cannabis markets. In the medical cannabis market, the OCM will supervise the continued expansion of the current medical cannabis program and institute reforms that expand patient access and product affordability while also encouraging research opportunities among medical cannabis providers, health care providers, and medical insurers.