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NY State to Implement across the Board Medicaid Payment Reductions

October 8, 2010

Late this summer the legislature passed the FMAP contingency budget plan. This bill dealt with the possibility that federal FMAP funds would not cover a $1.085 billion budget gap. The federal government has earmarked $1.4 billion in enhanced FMAP and education funding and an additional $700 in Race to the Top education funding, which should have eliminated the need for the FMAP reductions. However, some of these funds have not yet made their way into the state coffers.

Therefore the State has enacted the FMAP contingency budget cuts. Effective September 16, 2010 most Medicaid providers, including Medicaid transportation providers, will see an approximate 1.1% reduction in their Medicaid payments. This reduction is scheduled to continue through the end of the state fiscal year, March 31, 2011.  It is important to note that this is an across the board cut to not only transportation providers, but hospitals, nursing homes and other health and human service agencies.

We are hopeful that the Legislature will come back into session in the near future to allocate the federally earmarked funds and eliminate the need for this reduction to continue.

The Financial Plan Report is available for viewing at:

http://publications.budget.state.ny.us/budgetFP/201011FinancialPlanReport.pdf

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