Some Big Wins and a Few Losses for Low Income New Yorkers in State Budget

April 1, 2007

Author: Susan C. Antos

Medicaid & Child Health Plus

The best news for low income New Yorkers in this year’s budget is the eligibility expansion for Child Health Plus from 250% of the federal poverty level to 400% of the poverty level.  This expansion is subject to federal approval, but state officials have already submitted the state plan amendment and are hoping that the new eligibility levels will be in place sometime next fall.  Under the new eligibility levels, the majority of New York's 400,000 uninsured children would be eligible for free or subsidized health care. . 

The budget also includes two significant streamlining provisions for New York’s Medicaid program.  First, beginning in January of 2008, Medicaid beneficiaries will be able to self-attest to resources and residency during recertification.  Eligibility workers will verify the information given by beneficiaries using existing state information systems.  If a discrepancy appears, beneficiaries will be asked to provide documentation. 

Second, the budget provides adults applying for Medicaid with 12 months of guaranteed, continuous eligibility, which is already provided to children applying for public health insurance in New York.  Federal law allows states to provide continuous coverage guarantees to children, but not adults.  Therefore, this provision of the budget, like the Child Health Plus eligibility expansion, will require approval by the federal government before it is implemented in New York.

Also requiring federal approval is language that was included in the budget as a result of litigation brought by the Empire Justice Center and Legal Services of Central New York that restores the medically needy program’s income eligibility level for households of one and two to the same level of income afforded to SSI recipients.  Although the budget language represents an important step toward resolving this problem, final resolution of the issue is still several months off.

Finally, the Legislature approved more than $900 million of the $1.3 billion in health care spending cuts requested by Governor Eliot Spitzer.  Unlike prior years, none of the proposed cuts were aimed at cutting benefits or restricting access to services.  In the end, the cuts include a reduction in Medicaid reimbursements to pharmacists; a freeze in premiums the state pays to insurance companies that provide coverage for Medicaid beneficiaries; and about $82 million in cuts to nursing home and hospitals, which were accomplished by reducing the trend factor used to boost rates annually and redistributing some of the funds set aside for graduate medical education and worker retention and recruitment.

Child care out of the Flex Fund, but overall increase in funding is small

Governor Spitzer had proposed $533 million dollars in child care funding in his budget consisting of federal Child Care Development fund monies and the required State and local shares.  In addition,  Governor Spitzer’s budget had proposed to continue a funding devise first implemented by Governor Pataki in last year’s budget - the Flexible fund for Family Services - also known as the Flex Fund.  This fund put the Temporary Assistance to Needy Families (TANF) block grant money that had previously gone to child care into a block grant, putting the availability of these funds for child care at risk since the county could choose to fund a variety of programs with these funds - programs such as child welfare, employment demonstration and drug screening and treatment.

The final budget removed child care from the Flexible Fund for Family Services, but the amount of TANF funds that were added for child care was $356.3 million dollars, only 4.3 million dollars more than was spend by the counties out of the Flex Fund last year.  The Assembly had proposed an increase to $417 million dollars which would raised the total amount of funding to $950 million.

Significant expansion of Pre-Kindergarten

Governor Spitzer has promised Universal Pre-kindergarten for New York State within the next four years, and this year’s budget offered a significant down-payment, adding $149 million in new dollars from Pre-K.  This brings the total of all Pre-K funding in New York to $438 million dollars.   The New York State Universal Pre-kindergarten (UPK) program was established under Chapter 436 of the Laws of 1997.  During the 2004-05 school year, 192 districts (224 eligible) served approximately 57,000 students. This increase will allow significantly more students to be served.

No public assistance grant increase

After the Governor proposed his budget in January, the Assembly put a proposal in their Article VII bill that would have raised the public assistance grant by 10% over two years.  This proposal did not make it in to the final budget.  However, the Assembly has pledged to hold hearings on the adequacy of the public assistance grant this fall so there may be some movement on this issue next year.

Child care and child support

Obtaining a child support order continues to be an eligibility requirement for the receipt of a child care subsidy for low income families who are not on public assistance.  The Assembly had proposed language in its Article VII bill which would have required districts to encourage families to obtain child support orders, but would not have required that parents obtain orders as a condition of receiving assistance with child care. Unfortunately, because of resistance from the Senate, this language did not make it in to the final bill.

Executive Order to Establish a Children’s Cabinet

Outside the budget process, Governor Spitzer has announced his intention to sign an Executive Order which will establish a Children’s Cabinet which will be chaired, by the Director of State Operations, Olivia Golden, who was formerly the assistant   secretary for children and families at the Department of Health and Human Services.  The press release announcing the Cabinet also states that  Dennis Whelan, the Governor’s Deputy Secretary for Health and Human Services and Manny Rivera , the Governor’s Deputy Secretary for Education will co-chair the Cabinet.  The first two tasks of the children’s commission will be the implementation of Universal Health Insurance for children and the implementation of Universal Pre-Kindergarten.