Hey, New York: You Owe Us!

Locals move to block Albany’s Medicaid money-grab

by Robert Lynch, February 21, 2023

There’s an old tax-time adage:  “What Washington giveth, Albany taketh away.” And now, with one costly, soon-to-be-assessed mandate, it’s as plain as the eye can see.  And you may feel the bite next January when you pay your county tax bills.

“We need to underscore how serious this is.” Administrator Holmes.

With limited debate and by a unanimous vote, the Tompkins County Legislature Tuesday urged New York State to preserve the intent of Congress and not allow state regulators to hijack supplemental federal Medicaid spending that locals insist counties like theirs were always supposed to be paid.

“We received notice recently from the Association of Counties that based on their recent conversations with the Governor’s Office (that) it does not appear there’s an appetite to restore these pass-throughs for 2023 or at any date in the future,” County Administrator Lisa Holmes notified the Tompkins County Legislature at its Tuesday night session.

“This is not pretty,” Dryden Legislator Mike Lane later observed.

Holmes’ financial warning was sobering, and the consequences of what we taxpayers could suffer are dire.  A Department of Social Services number-cruncher told Holmes that should State fiscal managers hold true to their plans, approximately $610,000 or more could be cut beginning in April from New York’s Medicaid disbursements to Tompkins County.  An additional $1.5 Million could be cut in 2024.

“If enacted,” said Holmes, this year’s cut “would mean the consideration of hiring delays, or a hiring freeze, stopping  the purchases of larger pieces of highway equipment, and it will also impact projections for what we can afford going into negotiations with our bargaining units.”

And beginning next year, Holmes warned, taxpayers, too, could feel the pinch. 

In 2024, “we’d start out the budget process immediately with a three per cent increase in the tax levy without some further action being taken,” Holmes said.  Keeping within the state-specified (and largely aspirational) tax cap, she said, could prove next to impossible.

“We need to underscore how serious this is for our county’s budget and all county budgets across the state,” Holmes warned.

The circumstances that led to this suddenly-erupted financial crisis are of the kind bound to make any tax-weary New Yorker mad as Hell.  And they stand as just another example of Albany’s budget-balancing, pass-the-buck greed. 

Legislators were told that when Congress adopted, under the Affordable Care Act, its “Enhanced Federal Medical Assistance Percentage Fund to Counties” (or so-called “ACA E-F-Map Funding”), Washington intended that the states, including New York, that require counties to share a portion of Medicaid burdens, would themselves pass some of the ACA supplements down to the local level.

“And in fact, New York State agreed to do that when they first received this money,” legislator Rich John told his legislative colleagues.   

But something changed along the way, he said.  Somehow, all those millions in county pass-through funds got gobbled up in the inner-works of Albany’s internal bureaucracy.  And now it seems the State has simply chosen to keep the money for itself.

They call it “reconciling the payments.” And now they just keep the money. Rich John

“They’re saying they’re reconciling the payments,” John stated, the legislator employing one of those typical eye-glazing terms bureaucrats use.  “But that has been a completely opaque process,” he continued.  “We haven’t seen the money.  And now the current proposal is to just have the State keep all the money, while asking for more services; enhancing the services.  And we’ll be paying the cost locally.”

“So the hit comes in more than one way,” Rich John concluded.  “And it’s not what the federal Congress intended.  So that’s why it’s pretty upsetting.”

One week before many on the Tompkins County Legislature will troop to Albany for a meeting of the New York State Association of Counties, those same legislators adopted the Resolution Tuesday calling upon the State to reverse-course and restore Congress’ intended pass-through of the ACA money to local coffers.

“The Resolution you will be considering tonight is an important step in advocacy to try to stop these cuts from taking place,” Holmes said.

“Lisa’s comments were pretty compelling,” Budget Committee Chair Deborah Dawson, a fiscal hawk, told Tuesday’s meeting.  “We’re just going to have to put as much pressure on our State Legislature as possible to override this proposal by the Governor,” Dawson said.

“We’re just going to put the pressure on legislators.” Budget Chair Dawson.

But in typical Albany it-wasn’t-my-fault fashion, Governor Kathy Hochul may have slyly kept her fingerprints off this major-impact money grab.  The Executive’s proposed budget, we’re told, never referenced the funding holdback, and all the real blame may be buried down in some regulatory rabbit-hole, virtually impossible for the Legislature to excavate or ever correct.

“This may be out of their hands,” Mike Lane worried.

Lane pointed out that New York is one of only two states in the nation where local counties still bear a partial burden for Medicaid funding, subsidies that underwrite medical care for low-income residents.  And of those two states, New York counties, Lane said, pay the highest percentage.  The Dryden Democrat equated New York’s mandated county contribution to an effective statewide property tax, but a tax for which Albany-based lawmakers never get the blame.

New York’s counties, Lane complained, “get treated like poor relations.” And when it comes to assessing the cost, he said, Albany’s message handed down is this:  “You do this, and you raise the money.”