New York State SmartTranscripts:

[Speaker 0]: Good morning, everyone. I'm impressed. Gary pretlow walks in and everyone gets quiet before I even ask. Yeah.

[Speaker 1]: Why would that be?

[Speaker 0]: We're not going there.

[Assembly Member Gary Pretlow]: We're not going there.

[Speaker 0]: That was humor. That was humor. Alright. Hi. I'm Liz Krueger, chair of the senate finance committee. This is my partner in these hearings, Gary Pretlow, the chair of Ways and Means for the assembly. And today is the health hearing. And based on how we take turns with running hearings, this one is the senate run hearing. So good morning. I have to do this opening statement, and it it helps us for the rest of the day. Mhmm. So, basically, just some of the rules of the road. One, if you are behind a microphone and you were supposed to be speaking, you will notice that there is a red ring or a green ring on your microphone. If you are attempting to speak and be heard, you need to press the push button until there's a sweet spot on it until it turns green, and then we'll be able to hear you. Then you also, if you're anywhere near a microphone, on this side or on that side, you'll see clocks, and they tell you how much time there is for you. So right now it says ten minutes. The government representatives, and that is our first panel, have ten minutes each to testify. They can have testimony, and any of you who are testifying today could have testimony that's as long as you want it to be in writing. And it goes up online, and all 20 New Yorker 20,000,000 New Yorkers can read it. But you only get ten minutes to present if you're a government witness, and you only get three minutes to present if you're any other witness. So the skill set to have here today is how to be very effective in a very short period of time to get your points made. Same issue if you're a legislator who's asking questions. If you're a chair, you have ten minutes to ask questions of the entire panel. So if the panel is six people, you have ten minutes to share between six people. If the panel is one person, you have ten minutes to share with one person. So chairs get ten minutes, and they're the only ones who get a second round of three minutes at the very end if they want. Then you have the relevant rankers of the same committees, and they get five minutes, no second round. And all other members of the legislature only get three minutes with no second round. And they're always very frustrated because three minutes is a ridiculously short period of time. I get it. Then when after when we finish the panels with the government invited witnesses, we get to the public people who have asked to testify. And many of them get told, no. I'm sorry. You can only submit written. But we have time for some, and we put them on panels. And they get three minutes, and questioning of them is three minutes. So it moves much quicker more quickly after the government part of the hearing. But of course, it's the governor's budget that we're here to ask questions about and to comment on. So again, the good morning. We already know this is Gary Pretlow. I'm Liz Krueger. Today is the seventh of 14 hearings conducted by the Joint Fiscal Committees of the legislature regarding the governor's proposed budget for state fiscal year twenty six-twenty seven. These hearings are conducted pursuant to the New York State constitution and legislative law. Today, the Senate Finance Committee and the Assembly Ways and Means Committee will hear testimony concerning the governor's proposed budget for the following agencies: Department of Health, Department of Financial Services, only specific to their role with health insurance today. Following each testimony, there will be some time for questions from the chairs of the fiscal committees and other legislatures. I will now introduce members from the senate and assembly member Gary Pretlow, chair of the assembly ways and means committee, will introduce members of the assembly. In addition, senator Tom O'Mara, ranking member of the senate finance committee, will introduce members from his conference and a special guest ranker from the assembly two years. Special guest ranker from the assembly ways and means committee will introduce his representatives. So just to start with senators, we have Senator Gustavo Rivera, who's the chair of health. Senator Jamal Bailey, who's the chair of insurance, Senator Ryan, Senator Webb, and Senator Souffrant Forrest. Let's see if anybody else showed up. I think that's it for now. Okay. I'm going to turn it over to the assembly, Garrett Pretlow.

[Assembly Member Gary Pretlow]: Thank you, Madam Chair. With us we have the Assemblywoman Paulin, the Chair of Health. And we have Assemblywoman Lunsford, Assemblyman Otis, and Assemblyman Braunstein.

[Speaker 0]: Okay. And then we have Senator Tom O'Mara, our ranker on finance.

[Senator Tom O’Mara]: Good morning, Chairwoman. Thank you. On our side, we have our health ranking Senator Patrick J. Sullivan, and our insurance ranking member Pam Hellman.

[Assembly Member Gary Pretlow]: Great. Jeremy Jensen.

[Assembly Member Josh Jensen]: Yes. Josh Jensen. I'm the twelve hour ranking member of Ways and Means and the health ranker. We're joined on the minority side by acting insurance ranker Phil Palmisano and assembly members Jarett Gandolfo, Matt Slater and Scott Gray.

[Speaker 0]: Okay. Thank you very much. So now we're going to turn to our first panel and give them opportunities to speak for ten minutes each. And I think we are going to start with Commissioner McDonald, acting commissioner of the New York State Department of Health. Good morning.

[Dr. James McDonald]: Good morning. And just as a point of clarity, I've been confirmed, so not acting. Long time ago. Anyway, so good morning Chairman Krueger, Pretlow, Rivera, Paulin, and ranking members, Galavan and Jensen, and members of the Senate and Assembly Health Senate Finance and Assembly Ways and Means Committee. Happy to be here to testify on Governor Hochul's executive budget for fiscal year 'twenty seven as it relates to the health and well-being of all New Yorkers. While the entire budget focuses on affordability, safety, and our future, my comments today will highlight some of the Governor's proposals that focus on the Department of Health's budget. Joining me is Medicaid Director, Amir Basiri. So the mission of the Department is protect and promote the health and well-being for all, built on a foundation of health equity. This has not changed. You know, the entire FY '27 proposed budget is $260,000,000,000, an increase of 5,600,000,000.0 from last year. The entire Department of Health budget has proposed 111,900,000,000.0, a decrease of 3,200,000,000.0 from last year. Medicaid accounts for 99,900,000,000, up from 93,000,000,000 and the Essential Plan accounts for 3,800,000,000.0, a decrease of 10,800,000,000.0 reflecting changes from HR one. The remaining $8,100,000,000 is for everything else the department does, including public health, WIC, early intervention, Wadsworth and so much, much more. Keep in mind that 61% of the Department of Health budget is supported by federal funds, primarily due to Medicaid and the Essential Plan, but also 97% of the department's budget is in aid to localities, in other words, to help all of our constituents. Medicaid currently insures care, health care for 6,800,000 New Yorkers, down from a peak of 8,000,000 during the public health emergency. It is important to remember that Medicaid does more than provide for direct patient care. The eleven fifteen waiver is an example of how New York is leveraging our current demonstration project with CMS to improve population health, expand and enhance our workforce and help safety net hospitals. New York opted to establish the essential plan in 2015, which currently helps 1,700,000 working New Yorkers access healthcare at no cost. Due to the enactment of HR one, which cut half of the funding that supports the essential plan, have we submitted a request to CMS to terminate our 1332 waiver and revert to the basic health plan as authorized under section thirteen thirty one of the Affordable Care Act. This will preserve insurance coverage for 1,300,000 people. Under federal law, basic health plan program eligibility is limited to twice the federal poverty level, so this would mean that 450,000 current higher income working enrollees would become ineligible for the essential plan. While we are hopeful that CMS will approve our transition back to the basic health plan, the financial plan reflects a worst case scenario in which our thirteen thirty two waiver is not approved. Now were this to happen, over 500,000 lawfully present immigrants would shift to state only funded Medicaid, which shifts costs from the federal government to the state for over $2,000,000,000. This budget builds off the success of prior year's Safety Net Transformation Program by investing $1,000,000,000 in capital funding and at least $330,000,000 in operational funding, which will allow the department to approve even more projects. Other investments include up to $1,500,000,000 from the Healthcare Stability Fund for hospitals and nursing homes to address operational costs and a continuation of investments which were planned as part of last year's budget. Regarding supporting healthcare workers, New York continues its robust investment in FY '27. We'll be spending over $415,000,000 next year, which will be used in many ways, such as introducing health professions to young people, helping students complete their education, helping professionals pay back student loans are just a few examples. An example of additional support the department provided last year was our very successful nursing summit, where hundreds of nursing leaders gathered with us to better understand issues related to nursing workplace violence, recruitment and retention and facilitated sharing best practices. We have heard loud and clear from stakeholders about the need for changes in scope of practice. We've worked with the state education department to develop a strong proposal to allow medical assistants to administer a vaccine after appropriate training, which is currently allowed in the other 49 states. We've also heard from nursing homes they still face challenges hiring nurses. Now would be a good time for New York to join. The other 38 states allow a certified medication aide to administer routine medications. We've also worked with physician assistants to strengthen our proposal to allow PAs with sufficient hours of training to practice independently in hospitals and primary care settings, expanding the reach and availability of this critical clinical profession to more New Yorkers. New York is one of three states with a medical indemnity fund, alternative to provide for future healthcare costs of individuals who have suffered birth related neurological injuries. The fund remains solvent. This year an additional $75,000,000 is allocated in addition to the base of $52,000,000 in funding, along with reforms we worked on together last year. This budget also invests $3,200,000 to enhance cardiac arrest survival throughout New York State by increasing the number of public access defibrillators in each county combined with using regional training hubs to decreased number of New Yorkers who are trained in hands only CPR. Our data shows that CPR saves seven fifty lives a year in New York and the goal for this program is to decrease that number by thirty percent. The Department's Bureau of Auto Records for the first time in five years has halted growth of the backlog of certain requests for records requests and reduced our document requests for certain requests backlog by three months. This budget includes $7,000,000 to improve services in Vital Records, We'll recruit more staff and help further reduce backlogs in vital record requests. There's also going to be technology upgrades that will help with digitization of records. There's also a $1,500,000 investment so the department can hire more expertise in artificial intelligence as well as contract with the partners so we can achieve an optimal understanding of artificial intelligence usage in healthcare and growing applications. We will also create an artificial intelligence governance model to evaluate these tools and share best practices with the healthcare field. Access to healthy food is an important social determinant of health. There's several investments in this budget designed to help optimize the nutrition of New Yorkers and build on the governor's $65,000,000 investment in emergency food assistance to help feed New Yorkers while there were federal SNAP disruptions. The Hunger Prevention and Nutrition Assistance Program, in particular, will benefit from its continued $57,000,000 in funding, plus an additional $15,000,000 which brings our total investment in HipNap to $72,000,000 Nourish New York, a program administered with Ag and Markets, has a $5,000,000 investment boost, increasing our total investment to $55,000,000 This is all on top of our $623,000,000 spending on WIC, which includes $9,400,000 state contribution. This budget includes a $3,750,000,000 investment over the next five years to support and protect our state's clean water infrastructure, including drinking water supply. The department has also received $369,000,000 from the Bipartisan Infrastructure Law to replace lead service lines. The department has used $23,000,000 in Clean Water Improvement Act funding to assist in replacing service lines which would not otherwise be covered under the Bipartisan Infrastructure Law. In '25, the department implemented the lead rental registry in New York State, which will ensure homes are safe for children and free of lead before they move in. The department entered into a cooperative agreement with CMS for $212,000,000 for the first year of an anticipated five year award for the Rural Health Transformation Program. These investments will help improve healthcare workforce, access to care, technology upgrades, cyber security enhancements and partnerships. In closing, just a word about collaboration. Earlier last year, New York joined a few other states in founding the Northeast Public Health Collaborative. This collaborative is an apolitical force multiplier of 16 health departments advancing the public's health. In addition, New York State Department of Health has had a longstanding relationship with the World Health Organization via Wadsworth and the APHL. Yesterday, we codified that relationship by officially joining the Global Outbreak Alert and Response Network, which will be a mutual benefit. Collaboration is important. I'm reminded that in 1901, it was people like you, elected leaders, who enacted legislation with then Governor Benjamin Odell to create the New York State Department of Health. In nine days, the department will celebrate its one hundred and twenty fifth birthday. Since then, the department has grown to one of the largest and most effective health departments on the planet. We live in unusual times. Public health is under assault like never before. During my tenure as commissioner, together we have made great changes. Together we have invested in nursing home surveyors to protect our most vulnerable. We have cut runaway administrative costs in the Medicaid pharmacy program by creating NYRx with no impact to patient access and we have shored up New York State's reproductive freedoms and installed protections for gender affirming care. I remind my team often, the federal government isn't making our jobs harder, they're already hard, it is making them more important. That is true for me, it's also true for you as well, as we're all in this together. There has never been a more important time to stand up and fight for New Yorkers. Thank you, I do look forward to your questions and dialogue.

[Speaker 6]: Jenifer?

[Speaker 0]: J. You. Excuse me. I'm getting so many emails about you. So I off focus for a second. And I do apologize. I remember confirming you to speak.

[Dr. James McDonald]: J. You were there, and my wasn't daughter there. Was there

[Speaker 0]: as well.

[Speaker 7]: J. J.

[Dr. James McDonald]: It was June 9 '23 when I was confirmed. And it was exactly thirty three years to the day of when I graduated medical school.

[Speaker 0]: J. Wow.

[Dr. James McDonald]: So I won't forget it for a lot of reasons, but that was one of them. J.

[Speaker 0]: That's a good reason. Thank you. And next up, shall we do, just so they'll keep it with Department of Health for a little bit, to Amir Bazini, who is the Medicaid director at the Department of Health. And that always seems to have plenty of questions from us.

[Dr. James McDonald]: Yeah, and Chair Kruger, actually I just testified on behalf of Amir, so we're good to go. So we can go on to the next witness if it's going

[Speaker 0]: to Oh, okay. So you'll just be ready to answer questions.

[Dr. James McDonald]: He's ready to help.

[Speaker 0]: All right, thank you. Let's shift to the New York State Department of Financial Services, Caitlin Asro, acting superintendent. Welcome.

[Caitlin J. Azar]: Thank you. Good morning, chairs Kruger, Pretlow, Bailey, Wepprin, Rivera, and Paulin, ranking members Omara, Ra, Helming, Blankenbush, Gallivan, and Jensen, and all distinguished members of the New York State Senate and Assembly. My name is Caitlin Azro, and I'm the acting superintendent of the New York State Department of Financial Services. Thank you for inviting me to discuss governor Hochul's executive budget and the department's work over the past year, thanks to the support of the governor and the legislature. I appreciate the opportunity to highlight DFS' efforts in the health care space and look forward to appearing before you again on February 26 joint legislative hearing to discuss the full scope of the department's work. Before I begin, I want to thank governor Hopewell for trusting me to lead DFS into its next chapter. Since taking on the role of acting superintendent, I've had the opportunity to meet with some of you. For those of you who have not yet had the chance to meet, I'm hopeful that today's hearing will provide you with some important background on who I am and my priorities for DFS, affordability, innovation, and stability. I have been fortunate to work across financial services in both the public and private sectors. I started my career working in The Middle East supporting economic development projects and saw the impact of financial services helping families and small businesses directly. I then moved on to the Financial Health Network, the nation's leading authority on consumer financial health. From there, I served as a senior adviser within the Federal Reserve System. I brought these experiences to DFS in 2022 as the head of the research and innovation division. During this time, I led our work in innovation policy, economic research, financial inclusion, data governance, and the licensing and supervision of virtual currency companies. I was honored to be appointed as acting superintendent last October, and I am especially proud to step into this role having served alongside DFS colleagues for the past four years. Throughout my time at DFS, I've worked to advance our mission to protect and empower our fellow New Yorkers. Core to the work we do is ensuring that regulation creates more affordable and accessible financial and health care systems for New Yorkers. Consistent with the governor's affordability agenda, DFS is focused on ensuring access to affordable health care and delivering meaningful cost savings for the people of New York. We also hold entities accountable when they don't meet those standards. Last year, DFS returned more than $134,000,000 directly to New Yorkers through restitution. My initial focus in this role and the first meeting I convened was on addressing the cost and availability of insurance in New York. At that time, I directed my team to update the DFS website and develop a campaign on insurance discounts available to New Yorkers so that policyholders can take advantage of programs that can lower their premiums and access incentives that put money back in their pockets. The governor's executive budget builds on this foundational work. DFS was proud to support and implement actions by governor Hochul and the legislature to eliminate out of pocket costs for insulin, inhalers, and lung cancer screenings and to protect critical vaccine access across New York state. To keep New Yorkers safe, governor Hochul will advance legislation to ensure New York can set its own immunization standards based on accepted medical science and public health needs. With health care costs continuing to place pressure on family budgets, DFS has taken further action to reduce barriers to care and eliminate unnecessary out of pocket expenses. In 2025, the Department adopted and implemented new rules to increase access to mental health care and substance abuse treatment. New Yorkers are now entitled to an initial appointment for mental health or substance use disorder care within ten days of request. Where those standards cannot be met with in network providers, insurers must offer out of network coverage at in network prices. To expand on this work, the Department, in coordination with the Office of Mental Health, has launched a consumer education campaign to ensure New Yorkers are aware of their rights under the state's regulations. Last year, the Department also adopted regulations requiring commercial insurers collect voluntarily disclosed demographic data from policyholders. This data will be a powerful tool to develop long term policy solutions to combat discrimination, address health inequities, and direct resources where they are most needed to ensure New Yorkers have access to the care they are entitled to. Another tool for reducing long term health costs is access to preventative and primary care to improve health outcomes, therefore avoiding high cost services. To that point in January, DFS issued a formal request to insurers for data on primary care spending and programs that have been effective in increasing this utilization. Even

[Speaker 0]: as

[Caitlin J. Azar]: we advance affordability, we are mindful that challenges facing New Yorkers and the entities we regulate are growing more complex and more interwoven with technology. This brings me to my second priority, innovation. Staying abreast of emerging technologies and their deployment by financial institutions is essential effective regulation. I have accelerated our modernization efforts, prioritized the recruitment of subject matter experts, and updated internal policies so we can responsibly use and understand the technologies we are charged with regulating. A key component of our modernization effort is DFS Connect, a modern interface that is making DFS a more streamlined and effective regulator. Last year, we expanded DFS Connect to allow New Yorkers to file and track complaints related to prescription drug prices and pharmacy benefits managers. We also introduced the tool to the insurance industry, enabling insurance carriers to submit filings, manage license renewals, and communicate directly with the department through this portal. At the end of last year, I introduced the Department's first ever AI use policy. This policy paves the way for us to responsibly use AI internally while maintaining critical safeguards around data protection, accountability, and risk. DFS has also set clear expectations of how regulated entities should use AI, making clear that entities must adapt their frameworks to address emerging risks. Thus far, I have developed three pieces of AI guidance, including on the use of AI in insurance, underwriting, and pricing. Finally, I want to emphasize that innovation must always be paired with consumer protection. By modernizing our tools, adapting our oversight, and setting clear expectations, DFS can support innovation while maintaining a stable and fair financial system. Ultimately though, my foremost priority for the department and for the people of New York is stability. At a time of sustained change across the financial services and health care sectors, maintaining continuity and confidence is critical. While changes at the federal level may require a response from New York, from a regulatory perspective, entities can feel confident that our expectations will not waver and New Yorkers can rest assured knowing their protections will remain in place. Central to stabilizing this market is addressing insurance fraud, which drives up costs for consumers and undermines confidence in the system. Over the past year, DFS has transformed its approach to combating financial and health care fraud by rebuilding and modernizing our Insurance Frauds Bureau. Governor Hochul's executive budget builds on these efforts by enhancing DFS and the state's capacity to investigate and prosecute these crimes. The governor's executive budget also advances key initiatives to ensure New Yorkers have a stable health care provider. The executive budget proposes expanding New York's continuity of care protections to ensure that New Yorkers who change carriers can continue seeing their existing provider for ninety days or through the completion of postpartum care, regardless of health condition or stage of pregnancy. The executive budget also includes a proposal to eliminate repetitive prior authorizations for medically necessary treatment of chronic conditions. TFS will further support these initiatives by launching a public education campaign to help consumers better understand the health insurance claims process, exercise their rights, reduce avoidable disputes, and promote the timely resolution of claims. Stability also depends on the dedication and shared purpose of the public servants charged with carrying out this work. DFS's history dates back to 1851. Today, every member of the team carries forward this long standing legacy of public service. That responsibility is especially meaningful at a time when many New Yorkers are struggling to afford necessities from housing to health care. Our work and our commitment to stability has never been more important. Affordability, innovation, and stability are not separate goals. They are mutually reinforcing and central to how DFS serves New Yorkers. I know we share these common goals, and I'm confident we can work together on the behalf on behalf of the people of New York. Today, I'm happy to discuss the department's oversight of health insurance and the governor's health proposals in greater detail. I'm looking forward to talking about the Department's other areas of regulation and supervision, as well as the Governor's proposals on student loans, auto insurance, and property insurance when we meet again on February 26. Thank you.

[Speaker 0]: Thank you very much. Okay. So now we are going to shift to questioners. And our first questioner is our health chair. You're right. He does do cleanup. Never mind. We're going to have senator Bailey, our insurance chair,

[Dr. James McDonald]: go first.

[Senator Jamaal Bailey]: Thank you. And I hope that I can

[Speaker 10]: get if you can just have

[Senator Jamaal Bailey]: a brief preamble before the clock, I just wanna talk about the superintendent and and so just just so that all of our colleagues are aware, superintendent acting superintendent will will be testifying twice today and on February 26. I humbly request, more hum not so humbly, please do not ask questions to the superintendent that are not related to health insurance as she will be appearing again. It is not customary that the the department appears twice. It is a courtesy we've been granted by the department and by the governor, and we're grateful for it so let's not abuse the privileged colleagues. And make sure that your questions to acting superintendent are specifically related to insurance. Just wanted to make sure that was abundantly clear. And now you may restart the clock. Thank you. And so acting superintendent, thank you once again for appearing and also again for the courtesy. I wanted to personally thank you for that. Your testimony, you mentioned a lot about fraud, that seems to be a topic that that that's the topic that's yours, so to speak. I I just can you tell me about how you've approached your your approach to combating financial and health care fraud? And where are you seeing this, and how is it being perpetuated?

[Caitlin J. Azar]: -Yeah, thank you for that question. So, you know, we are seeing, as I noted in my opening remarks, kind of the approaches of nefarious actors getting more complex, use of different techniques. So we have transformed our frauds bureau to really keep pace with that on the insurance side. So just in the last six months, we've increased our headcount by 28%. We brought in four senior leaders from law enforcement to bolster our ranks, and we're taking a much more kind of data first, technology first approach by reforming how we're collecting information, and how we can aggregate that and share it with our state colleagues, thanks to support of the governor. We've also, you know, pulled together a multidisciplinary team from across government working again with state police, with other law enforcement individuals to really combat this. Medical fraud, in particular, makes up about five percent, of the total fraud cases we get, but that's something that, again, we're seeing grow. I will also note we hold our carriers to account. They all have to also investigate fraud and have their own programs to deter it, and and make sure consumers are protected.

[Senator Jamaal Bailey]: And on on the same topic, do we have any, specific data on on how much fraud is contributing to higher health care premiums? Everybody's complaining about, not complaining, I think this is the way of the world, premium premiums are higher. Do we have data, demonstrable data that shows that that we can correlate with why, premiums are going higher?

[Caitlin J. Azar]: Yeah. Thank you for that question. So, you know, we know that, of course, you know, fraud is feeding into some of the costs across the space. I will say in the health care space in particular, you know, we're happy to follow-up on on the data that we're seeing. Really, the core drivers in health care, though, are, the ending of the ACA subsidies and really our aging population across the country, also here in New York, that is changing how we're providing care and making it more costly as well as just inflationary factors.

[Senator Jamaal Bailey]: Wanna wanna go to another conversation that you mentioned in your testimony about prior authorizations. Obviously, this is a very it's a welcome, development, consumer friendly. You don't have to go through all the hoops. But can you tell us about the current prior authorization process and how was that delaying necessary medical treatments for patients with these chronic conditions that you mentioned and how would it differ in the new proposal that the Governor's mentioned?

[Caitlin J. Azar]: Yeah. Thank you for that question. So prior authorizations, you know, the intent is to make sure consumers aren't surprised later by a potential claims denial because of medical necessity. I will say currently prior authorizations are prohibited to be used for things that require immediate care. So if you need to go to the emergency room, if you have something that is very pressing, carriers cannot use prior authorizations with your providers. The proposal from the governor specifically is really about chronic conditions. And so that means, and we've had a number of complaints come into DFS about this. Someone's family has a chronic condition defined as lasting more than a year, but a carrier would ask for prior authorization multiple times. So this proposal means that in that year that is, again, the definition of a chronic condition a carrier can't come in and ask for another prior authorization.

[Senator Jamaal Bailey]: -Okay. That makes sense and streamlined it. And I'm looking forward to having more discussions about that one. I want to talk about the IDR, the independent resolution process. It was mentioned that Medicaid is being removed from this process entirely. Why do you feel that this is appropriate?

[Caitlin J. Azar]: -Yeah. I'm happy to comment, on the the overall IDR reforms. I will say it's a very fundamental program that, DFS runs for the commercial space. We have seen increasing utilization. It's really there to protect consumers from surprise billing, which has been a protection since 2014. But I'll defer to my DOH colleagues on the Medicaid question in particular.

[Senator Jamaal Bailey]: Okay. So in this realm, the arbitrators reviewing the claims, could we look at how the arbitrators review the claims as opposed to removing Medicaid entirely?

[Caitlin J. Azar]: So let me speak in particular to kind of the IDR program overall. So I think as I as I mentioned, it's really seen a lot of growth. So 500%, increase in utilization of the IDR program over the last two years. DFS runs the program where we, facilitate the arbitrators in the program, and make sure that that is running smoothly. We've now had 4,000 unpaid bills to the arbitrators who, again, are performing an essential function. So, really, the governor's proposal for IDR, first, for example, requires that arbitrator to pay it up front, which is common in other states and, again, in the federal program. And also is giving more time for arbitrators to make their decisions, which is very challenging. In some cases, they're looking at a lot of data. And then the proposal also sets a consistent benchmark for how the arbitrators are, considering all of the factors, and this is actually taken from a Biden era proposal on the federal IDR. So that's really what we're focused on. Again, in terms of, what's in or out of the program, I defer, to the executive chamber and my colleagues at DOH on Medicaid.

[Senator Jamaal Bailey]: That that's perfectly reasonable. I wanna I wanna shift to the, specific fiscals in the budget. The this budget has 273.3, 3, excuse me, million dollars for insurance purposes, an $18,200,000 increase over the last budget. And is this increase in funding going to be utilized for more full time employees? Can you more enforcement? Can you tell us how this increase is this increase is going to be utilized by the department?

[Caitlin J. Azar]: Yeah. Thank you. So I'll I'll speak to specifically the increases that are going to DFS across, you know, the health initiatives. So, absolutely, first, we really appreciate, you know, first governor Hochul for fully funding the department for its first time in history, which has allowed us to work to keep pace with this changing environment, changing technology. So, absolutely, some of those funding are going to, more staff to oversee insurance carriers, again, in the commercial market, which is our space, more staff for frauds, which is a priority here, as well as funding for different consumer awareness campaigns. So in all the proposals, I think it's, you know, very wise that we are focused on making sure consumers are aware of prior authorization changes, of claims handling. So that's what the funding will go to for DFS.

[Senator Jamaal Bailey]: That's important. And so and and we've we've spoken in the past individually and also collectively with many of my colleagues about the department looking to try to staff off staff up more. Can you tell us where those efforts are?

[Caitlin J. Azar]: Yeah. Absolutely. So, as you noted, we are grateful that this budget does incorporate, more support for staffing, which we are focused on. That being said, you know, across public service, it is challenging to, bring bodies in to compete with the the private sector in terms of salaries. And so I'm taking a creative approach. I'm focused on recruiting in new places. I am focused on, training in new ways, building dynamic team structures. I'm very proud that we have brought in, and she is starting, in a few weeks, a new executive deputy of insurance. And that role has been vacant for some time. And thinking about, bringing in consultants, bringing in new ways, to staff up in you know, and that's not uncommon for us to outsource examinations. And other states do that, as well.

[Senator Jamaal Bailey]: I happen to have a bill for that, as you likely know. May have gone through committee yesterday. But I I just wanna talk about some of the continuity of care provisions. And this is really important when carriers have disputes with hospitals or medical providers. The executive's budget indicates that this is gonna be changed to ninety days. Do you feel that's an appropriate time?

[Caitlin J. Azar]: Yeah. Absolutely. So to take a step back as well, thank you for that question. Continuity of care, if there is a provider dispute, so a provider and a carrier are no longer in a contractual relationship, we already have a ninety day protection for consumers in that instance. So you're able you get a notice within fifteen days that there's a cooling off period where, again, your typically in network provider is no longer going to be in network. So you have that time and then ninety days of continuity. The governor's proposal actually extends that same protection too if you choose to switch health care health care carriers, I should say. So I'm, switching to a new carrier and I can go see my same provider for ninety days or through postpartum care, regardless of my stage of pregnancy or condition.

[Senator Jamaal Bailey]: You mentioned DFS returned a 100 more than a $134,000,000 to New Yorkers, and that's that's an excellent number through restitutions. Can you tell us where where does that come from? Is it is it New Yorkers being overcharged premium? Is it like unclaimed funds? Can you tell us where that money comes from, and how is it disseminated to New Yorkers?

[Caitlin J. Azar]: Yeah. Thank you for that question. We're very proud. You know, our consumer assistance unit is very active and and provides a great service to New York. And so I'll say, some of that, about half of that is also going back, to providers, in terms of, you know, how the the carriers are paying for their services. So, again, supporting the provider networks, here in the state. And the other is directly to consumers. So that's a whole variety of things being overcharged for something, you know, errors that are, unintentional. So happy to follow-up and provide you kind of the detailed breakdown and then, you know, how we process that out to consumers.

[Senator Jamaal Bailey]: Let me the last minute minute that I have, I I'd like to talk to you about the AI. You mentioned that for the first time, you the department is utilizing AI. Well, AI, one, will it decrease any diminution of duties by humans, by individuals? Will will jobs be taken away? And secondly, how do you see AI being instrumental in the department moving forward?

[Caitlin J. Azar]: Yeah. Thank you for that question. So, you know, I will answer the first one. First is I don't see it currently as really replacing jobs. Right now, it's augmenting our ability to, process large volumes of data, to synthesize things more effectively, and then we'll see where that gets us. My goal and what I see happening is a different different types of jobs. Right? You'll come in. You'll use AI right next to you rather than, you know, it being doing doing those jobs for you. And I do expect this to help us do our work. It's part of kind of the creative solutions to keeping pace.

[Senator Jamaal Bailey]: J. Look forward to seeing you on the twenty sixth as well. Thank you.

[Senator John C. Liu]: J. Thank you.

[Assembly Member Gary Pretlow]: We've been joined by insurance chair Wepren, assembly members Anderson, assembly member Boros, assembly member Forrest, and assembly member Gonzalez Rojas. And our first Assembly questioner will be Assembly member Wepran for ten minutes.

[Speaker 0]: So then a few senators. Sorry. Also to introduce, since we last called up senators, we have Senator John Liu, Senator Fernandez, Senator Ryan, Senator Ashby, Senator Steck, and Senator Griffin. Riffo. Oh, Joe. I'm so sorry. My neighbor, I apologize.

[Speaker 6]: Senator May too.

[Speaker 0]: Oh, and Senator May, thank you. I did not see you there. Thank you, Assembly.

[Assembly Member David Weprin]: Good morning, Acting Superintendent Asbro, Commissioner McDonald. I've enjoyed the short period that you've been acting superintendent, working together with you. And I know you've testified at a hearing prior to the beginning of session. And obviously you're testifying today as well as in a couple of weeks. So we appreciate that. As you probably know, I've been involved in prior authorization legislatively and I'm happy to see the Governor's proposal on it. Where did the definition of chronic health condition in subpart D come from?

[Caitlin J. Azar]: That's a I appreciate that question. I'll have to, you know, circle back with your office on kind of where that that came from initially, but my understanding is those are medical kind of definitions. And, again, the key focus for the governor's proposal on that is is really the time period. Right? The the definition of chronic conditions extends, more than twelve months, and, therefore, the prior authorization should just mirror that so you're not having kind of repetitive burden on both the New Yorker as well as, honestly, the carrier who has to run through that process.

[Assembly Member David Weprin]: Okay. No, I appreciate that. Are there any circumstances in which insurers would be able to conduct additional utilization reviews for treatment of chronic conditions more than once a year, such as if a clinical guidance changes?

[Caitlin J. Azar]: Thank you for that question. You know, I think if the actual kind of guidelines and treatment program changes, there is a potential that the prior authorization would be necessary. But really, that's something that that The New Yorker would work with their provider on. And I think the providers in particular, have been great partners in navigating, that process with carriers. And then I will also say if there's ever any challenges to prior authorization, we have our consumer assistance unit who's always available and helping consumers navigate that directly. I'll also just note, in addition to, limiting the use of prior authorizations for chronic conditions over that time frame, the governor's proposal calls for us to change the law, to collect more information on the use of prior authorizations. In, in statute, it says what we can collect from insurers now. So there's also a proposal to collect more information, so we can better answer those questions and then subsequently understand any denials of claims if there was already a prior authorization in place. So with the collection of that data, we'll be able to incorporate that into a consumer guide for health, which we post on our website. It's available to consumers updated annually to get that information.

[Assembly Member David Weprin]: Terrific. I'm looking forward to working with you on that. On another topic, in 2023, I sponsored and moved through the insurance committee and the assembly legislation to require biomarker testing coverage of both Medicaid and state regulated commercial insurance. The law that just took effect last year and yet the law just took effect, and yet the executive budget has a proposal to roll back the Medicaid coverage. Isn't it sure sighted to limit coverage for testing under Medicaid, if doing so could cost us more by paying for ineffective treatments and procedures rather than utilizing targeted therapies that will move effective, that will more effectively treat conditions and improve patient outcomes?

[Caitlin J. Azar]: Yeah, thank you for that question. So I will note for biomarker testing under my jurisdiction on the commercial plans, we have rolled out checklists for our carriers, different kind of policies and forms, that incorporate the required biomarker coverage, and we fielded, a number of questions and kind of follow-up with providers to make sure that coverage is being provided. On Medicaid in particular, I'll defer to my colleagues here.

[Assembly Member David Weprin]: Okay, thank you. I appreciate some of the governor's efforts on combating fraud, insurance fraud, particularly when it comes to automobile insurance and the increase in premiums. How I know I've attended a few events with you and the governor on that. How is the campaign to stop fraud or limit fraud of insurance, specifically when it comes to automobile insurance. How is that going? And how do you see that reducing insurance premiums?

[Caitlin J. Azar]: Yeah. Thank you for that question. So I will note that, you know, the the governor's support of us overhauling and really improving our frauds bureau will support all insurance across the state, especially our partnership with other law enforcement groups. The I will note that kind of auto insurance falls within, the other lanes of DFS authority, so, look forward to discussing that more on the twenty sixth.

[Speaker 0]: Day to answer health insurance questions. But what the insurance chair might not have realized is we are inviting you to another hearing on the last day of hearings for economic development where you can be asked questions about other insurance, including auto insurance, because there's a lot of interest in what the governor is proposing in the budget for auto insurance. Just clarifying.

[Assembly Member David Weprin]: Thank Chair.

[Dr. James McDonald]: What

[Assembly Member David Weprin]: getting into substance addiction and other addictions, what non substance addiction treatments would be covered on the, in OMH Part R? This may be something for Commissioner McDonald.

[Dr. James McDonald]: J. You know, so there is actually broad coverage for addiction treatments right now, but it's mostly limited to things like buprenorphine and buprenorphine type medications, as well as methadone. Those are the time tested and really proven treatments for addiction, and the ones that we have the most effectives on. Really, they've been a really big contributor to our improvement in outcomes, where we've seen a nice decline in overdose deaths in New York. A lot of work to do there, but they've been very helpful.

[Speaker 13]: Yeah, and

[Caitlin J. Azar]: if I may, I'll just add, you know, under the insurance law and DFS oversight for insurance commercial carriers, we do require coverage for things such as eating disorders, gambling disorders, things that are not substance use based but are mental health disorders.

[Assembly Member David Weprin]: Okay. And then turning to medical malpractice. How would the proposed changes to the physician's excess medical malpractice program under HMH Part K impact the medical malpractice insurance market in general?

[Caitlin J. Azar]: Yeah, thank you for that question. So, I'll say the Governor's proposal for this extends the the medical malpractice access program supporting doctors, here in New York. What we've seen in DFS in our support of this program is, we now have six carriers in the market. In the years that, the the government has been supporting these providers. We have seen the the market strengthen, so we are not seeing you know, we saw rates stabilize, which is positive, and we think the market can, can bear more. And so this program changes, how the medical malpractice access program is paid for. So starting in the middle of this year, the providers who are renewing, so not this doesn't kind of take effect until July of of this year, we'll start paying 50% kind of on a rolling basis of that coverage. Currently, 15,000 doctors in that program.

[Assembly Member David Weprin]: Okay. And is DFS concerned that lagging premium payments to medical malpractice insurers would jeopardize their ability to pay claims?

[Caitlin J. Azar]: Yeah, thank you. Right now, we do not have concerns about the changes to the program. As I said, we feel strongly that the market has stabilized, but we will, you know, our capacity continue to monitor that closely. I will say the law is still in effect, that limits the ability for these carriers to be moved into a liquidation or insolvency proceeding. So we work carefully with them to to kinda sustain through any challenges.

[Assembly Member David Weprin]: Okay. And Commissioner McDonald, what is the rationale, if you know, for removing Medicaid from the IDR process? Or maybe the Medicaid Sure,

[Amir Bassiri]: thank you for the question. It's There's in the several reasons for removing Medicaid from the IDR process, starting with, you know, the federal IDR process does not include Medicaid. So that is one basis. The other basis is that we've seen in collaboration with our colleagues at DFS rapid escalation in the number of IDR claims going to dispute, very much done so by a subset of downstream providers that have clearly made business decisions and choosing not to contract with managed care organizations because of the IDR process and how that process results in an overpayment. When the IDR is comparing what a reasonable payment it is and it compares a charge master in the commercial market to the Medicaid reimbursement rate, there's a stark difference. And the determination is resulting in a higher Medicaid payment well above commercial rates for services that should be covered in network within a managed care plan. So we believe that the rationale is justified due to the perverse incentives that have resulted from Medicaid being in the IDR process.

[Assembly Member David Weprin]: Okay, I only have a couple of seconds left, but why was the Empire plan not included in the IDR process originally in the first place?

[Amir Bassiri]: J. The department does not oversee the Empire Plan.

[Assembly Member David Weprin]: J. Okay. I think my time is up. J.

[Speaker 0]: Thank you very much. Next up is our ranker on health, Senator Gallivan, five minutes.

[Senator Patrick Gallivan]: Thank you, Madam Chair. Good morning to the panel, and thanks for being here. Commissioner McDonald, if I could start with the MCO Tax and Healthcare Stability Fund. Since we talked last, if I have my information correctly, the federal government has extended the timeline as far as the ability to collect the MCO tax.

[Dr. James McDonald]: That's right.

[Senator Patrick Gallivan]: J. Would result in an additional approximate billion dollars to New I York.

[Dr. James McDonald]: Can't tell you the exact dollar amount, but it's we have now eight quarters. We're anticipating nine quarters. So we have till the end of calendar '26 for the MCO tax. So it wasn't as bad as we thought it was. When the state financial plan was created, we weren't planning on this many quarters this year. So there's a place for us to collaborate here is what

[Senator Patrick Gallivan]: I'm J. Let me jump ahead, if I may. The exact amount isn't as important as how it's going to be distributed. So can you talk about how you plan to distribute the sum in a whole or part to hospitals and nursing homes? And will home care be included in this?

[Dr. James McDonald]: Yeah, so we don't have a plan to spend the money. We were hoping to collaborate with you to come up with a way to spend the money. You have constituents, you know needs. We'd really like your input on how this would go, because you're right. Nursing homes have needs, hospital needs, but the larger health care community has needs too. Federally qualified health centers have needs. So there's a lot of entities that have legitimate needs here. And I think we have to be honest that we're concerned about the rising risk of uncompensated care because of some of the impact of HR1. So we don't have that, you know, carved in stone yet.

[Senator Patrick Gallivan]: I would love to help you distribute that. Along with the

[Dr. James McDonald]: I'm hoping all of you will, you know, we value your input.

[Senator Patrick Gallivan]: Let's move on to the savings generated that you've talked about before about from the CDPAP transition. You've identified a certain amount of savings. Same with NYRx. You've identified savings there. What I'm most interested is not so much the amount of savings that's been out there publicly. It's what are you doing with the savings? How are you reallocating what you've saved?

[Dr. James McDonald]: So if you look at NYRx, a lot of that savings was actually distributed to federally qualified health centers and other entities that did really important work. Some of that savings is just there. And then as far as the CDPAP savings, that money isn't specifically earmarked. Mean, you know, when I look at my budget this year, you know, I was expecting a difficult budget year, but I actually got an increase in my public health investment. Now I can't point to that savings, but I think because of the savings we're in a much stronger position this year than we could have been. So I think that's a win for all

[Amir Bassiri]: of us.

[Senator Patrick Gallivan]: What about the individuals that chose not to stick with the CDPAP program but enrolled in home care. That comes with an additional cost. I mean, that offset the savings? Or has it cost more?

[Amir Bassiri]: J. So I think it's not necessarily costing more. It depends on what the managed care organization is paying that licensed home care services agency. And we set prospective managed care premiums, meaning, and what that means is we're paying currently based on their historical cost and other rate setting trends. But as we monitor, the actuary looks at all costs in aggregate. So it'll look at home care costs, city pass costs, all costs together. And we have not seen an offset to that savings, even with the shift to licensed home care services.

[Senator Patrick Gallivan]: I'm told that there's a backlog. I don't know if the numbers are accurate, but are you aware of a backlog of individuals still seeking the services?

[Amir Bassiri]: No. And we had, as part of several actions last year, set up a call center that dealt with direct consumer calls. We had that up, we saw a precipitous decline month over month leading into December. So we I am not aware of that, no.

[Senator Patrick Gallivan]: Could you follow-up, either of you, and I know that the superintendent deferred, on the biomarker testing. The rationale why it's been cut for Medicaid recipients, and does it raise concerns about costing more in the long run?

[Amir Bassiri]: So, let me just say that we've the Medicaid program, the department, very supportive of biomarker testing and precision medicine. We cover biomarker tests today. And with the onset of the legislation, I think we've seen a really large volume of incoming tests and manufacturers requesting coverage of tests based on limited evidence and very little peer reviewed journals and national studies, even local determinations. As we've denied those, there have been a lot of misinterpretations about the statute and what the Medicaid program's obligations are. And so we thought it was worth clarifying. But we are covering several biomarker tests.

[Speaker 16]: Thank you.

[Assembly Member Josh Jensen]: Thank you. Assemblymember Jenifer. Thank you, Chairman. Doctor. McDonald, you mentioned the state's application to amend or rescind the waiver. Can you provide us an update with the status of negotiations on accessing the central plan lockbox?

[Dr. James McDonald]: Yeah. So I really can't give you an update other than what we've said out loud. In other words, this is up to the Center for Medicaid and Medicare Services. So just keep in mind, the state financial plan is built on worst case scenario. You know, we're hoping that it's gonna get approved, but keep in mind, we were the thirteen thirty one before we became the thirteen thirty two. So I think our argument is strong. But then this separate issue about getting back to the trust fund, we have every reason to believe we'll have access to the trust fund. Having said that, I think you'd all agree with me. This federal government's a little more than unpredictable. And so I really can't speak for them in particular. It's what they're going do.

[Assembly Member Josh Jensen]: Fair enough. So would that be with what you just said about built on worst case scenario? Does that take into account what the executive budget proposes the eventuality that we don't get the waiver amended or changed?

[Dr. James McDonald]: Yeah. So the way the state financial plan is created is it's assuming we do not get the waiver plus we do not have access to the trust fund.

[Assembly Member Josh Jensen]: Okay.

[Dr. James McDonald]: It is definitely a worst case scenario, but I think you'd agree with me. Important to be secure in this first, and then we can go from there.

[Assembly Member Josh Jensen]: Gotcha. The reconciliation package passed by congress in July calls for stringent work requirements as well as more frequent verification checks of Medicaid eligibility. Can you detail how DOH will be complying with these requirements and what data sources you're going to use to verify employment and other aspects of the requirements for eligibility?

[Amir Bassiri]: J. Yes, absolutely. Thank you for the question, Assemblymember. This has been a full court press since the HR1 legislation was put into law. We have put together a team of senior experts that meets practically every day to work through implementation details. And we are planning to convene stakeholders later this month with the United Hospital Fund. That will be an ongoing stakeholder convening where we will share as much information as we have about these new federal changes. The one you referred to with work requirements, this is a federal mandate that was put into law for HR1, taking effect in the first of the year. We will have to begin noticing impacted consumers. There's about 2,300,000 New Yorkers who would be subject to this requirement. We think that 500,000 at least should be exempt due to the exemptions in the law. We're using a variety of data sources to exempt them. That includes our own Medicaid data warehouse. We're going to use the shiny for hospitalizations. We'll be working with health plans and leveraging our eleven fifteen waiver IT infrastructure to get chronic conditions and other indicators. So we're really working real time. I just want to caveat, we do not have the federal guidance that will specify some very important details about how this will work. So we're flying the plane as we go. We expect those details to come by June, which is what is specified in the law. But we are taking this with our goals are to preserve as much coverage as we can. And we'll be releasing more information later this month at the United Hospital Fund.

[Assembly Member Josh Jensen]: J. Changing tact a little bit, New York has a public health goal of reducing cigarette smoking. What is the policy rationale for taxing nicotine pouches at similar rates to combustible tobacco despite the scientific differences and risk profiles among these products?

[Dr. James McDonald]: Yeah, so I appreciate, you know, this issue. I think one of things we have keep in mind is that we're really trying to help everybody not just cease tobacco use, which we're making nice progress on, but actually just not be addicted, period. One of things you're seeing in New York though is there's actually widespread just ignoring of the law. So the taxes, are done by tax and finance, they're the ones gonna implement this, are going to help us get flavored vaping under control and then help some of the other forms of nicotine get under control. Our job as a health department is going to be helping with storage and disposal. But I do think it's going to help us move in the right direction. The vaping issue in particular really concerns me deeply.

[Assembly Member Josh Jensen]: Okay. In relation to going back to what the Medicaid director just mentioned with complying with that and some of the things that the superintendent talked about, has there been any consideration by DOH, especially when it comes to Medicaid administration about adapting higher utilization of blockchain technology to have the program operate more efficiently and effectively, especially as there are more federal mandates on eligibility?

[Amir Bassiri]: Well, I would say I don't know that we are identifying any specific opportunities with blockchain technology. But we are always interested in the most advanced and sophisticated levels of technology to incorporate into this program and specifically the eligibility. So happy to if there's an opportunity you're aware of, happy to talk about that offline.

[Assembly Member Josh Jensen]: Sounds good. In last year's budget, federally qualified health or FCHQs received $20,000,000 in fiscal year twenty six, 10,000,000 in fiscal year twenty seven. In the executive budget this year, it zeros out fiscal year twenty six and moves 20,000,000 to fiscal year twenty seven. Why was that?

[Dr. James McDonald]: So I I think it's just important to remember where the source of the funds is. It's the health care disability fund, the managed care organization tax. And just the timeline of this, just so people keep this in mind, we got approval from CMS December '24. We didn't start receiving money till July '25. So first step, approval. Second step, get money. Third step, accumulate money. Fourth step, develop a methodology to actually push the money out the door. We'd like to develop the methodology with you to help us make sure we meet the needs of your constituents and then distribute the money. And this year so far, there's $40,000,000 planned for federally qualified health centers.

[Assembly Member Josh Jensen]: Okay. Thank you. And the executive budget includes 1,500,000,000.0 for targeted health care investments. Can you explain what the thinking is about allocating that money between hospitals and nursing homes? What is do you have principles or criteria to guide that allocation?

[Dr. James McDonald]: Yeah. So as far as that that's again the health care stability fund money. Yep. So, you know, we're looking forward to getting that money, the reality of it is we purposely haven't allocated how that money is going to be spent. We were hoping we could collaborate with you, the legislature, and help us meet the needs of our constituents and get your input on this. Because New York's got a lot of issues right now when it comes to health care, not just hospitals and nursing homes, primary care, federal government. There's a lot of need. So we'd like to work with you to actually allocate that.

[Assembly Member Josh Jensen]: Thank you, Doctor. McDonald. Thank you, Mr. Basirian. I didn't have any questions for you, but thank you anyways.

[Speaker 17]: Thank you.

[Speaker 0]: Sorry. Next up, we have senator Ryan.

[Senator Sean Ryan]: I didn't know I was going so quick. All right. Commissioner McDonald, thank you. I was happy to hear you talk about rural health care. I represent a very rural district and significant needs. But just specifically on the safety net transformation grants, definitely encouraged with the investment, with the grant program. But can you please explain a little bit about how much is left over from previous budgets? How much is there still what is the allotment? And when and when do you when some of those hospitals that have the application, when would you think they would expect to hear?

[Dr. James McDonald]: Yeah. So the Safety Net Transformation Program is very important because really it's about sustainable health care. There's been 13 approved, $4,600,000,000. FY twenty seven's budget has 1,300,000,000.0 allocated for this. It's a rolling admission process here. In other words, there's rolling application. We get far more applications, but what we're really trying to do is meet the needs of the community and solve problems and most importantly find sustainable health care for those communities.

[Senator Sean Ryan]: And I agree 110, 150%. I just, you know, our hospitals, some of the rural hospitals are in dire, dire, dire need. And that could MELTZ: be very, very helpful. And hopefully we could

[Speaker 0]: kind of disperse that or distribute that as soon as possible. MR. I agree. And keep in mind, distributing that requires a contracting process. And that's part of where we are right now with the 13 programs.

[Senator Sean Ryan]: Okay. Regarding the medical indemnity fund, can you shine a light on the changes being made to the medical so why was there a move away from 80% for the usual customary charges?

[Dr. James McDonald]: J. Yeah, so when you look at the medical indemnity fund, we have to make the fund solvent. So there's a $75,000,000 investment. But we actually met with folks last year where there was meetings from my team and the legislature. Had a really good conversation. But really it's about aligning the medical indemnity fund with to make sure the payment is at least Medicare rate, but, frankly, Medicare rate. It doesn't need to be so much higher. That just it's so much higher, and really it's just trying to treat the medical indemnity fund like other payers. That's really all it's about. But it's a $50,000,000 savings.

[Senator Sean Ryan]: J. And I know and I've heard from constituents back home. They're concerned. I'm concerned. I just want to make sure that we're good on that. But, Okay. And then also last question on the medical assistants. How do we know medical assistants are able to safely administer vaccines?

[Dr. James McDonald]: Yeah, medical assistants, you know, what we would do is require training. But keep in mind, 49 other states allow a medical assistant to give a vaccine. And keep in mind, this is a pretty simple thing to do, administering a vaccine. Keep in mind, medical assistants draw blood, which is complicated, do an EKG, which can be confusing. Medical assistants are really good people who can do these things. This is really one of those things where it's easily trained, and we know people can do

[Amir Bassiri]: this. J.

[Senator Sean Ryan]: I think they're great people.

[Dr. James McDonald]: J. I think they're great people, too.

[Assembly Member Gary Pretlow]: Member Polisamo.

[Assembly Member Phil Palmesano]: Yes, Todd. Thank you for your time. First thing, it's more of a point, Commissioner McDonald. I saw the release for the Healer program, which is a great program to help with student loan relief for those in the health care professions. And you have psychiatrists, dentists, primary care physicians, nurse practitioners, and pediatric clinical nurses. I don't need to elaborate on this because of the time I have. But I have heard for physician assistants who said, why aren't we included in that program? So I hope you go back and evaluate that to include our physician assistants in that program. Because especially with how health care is delivered, there's more of a growing demand for physician assistants. So I hope you look at that program. But I did want to my first question really is more around the Rural Health Transformation Program. You know, why the department has released a project narrative and priorities, but it seems to be limited public information on timing, sequencing, structure, and obviously the challenges they have to meet. Can the department really provide any detailed timeline of when the program, including guidance and application materials, are expected to be released, and whether funding will be awarded in phases, and the anticipated timeframe for initial awards.

[Dr. James McDonald]: Yeah, so the Rural Health Transformation Program really could be transformative for New York State, but I think it's really important to understand this is not a grant. It's a high touch cooperative agreement from Center for Medicaid Medicare Services. One important provision of this is buried in the budget language somewhere is we need procurement flexibility for this. I think one of the things that's really important to grab onto is if we do not get the procurement flexibility. Keep in mind, the federal government did not want to do this. This was something they had to negotiate toward the end. One of the things about this is if you do not allocate the money by October 30, you don't get any money for the next year and then it's over. So there's a possibility we'll get no money from this. That's $212,000,000 at risk. It's a really important program. You know, as far as timeline goes, it really depends if we can get the procurement flexibility because quite frankly, if we don't get that, very little of this is actually going to get spent in New York State. It's a real problem.

[Assembly Member Phil Palmesano]: J. Okay. On that same point, do you think New York's application award amount could and will be affected by the fact that we have a strict scope of practice laws and not being part of interstate licensure compacts. Could that impact the possible awarding of funds and implementation of this program to help our areas? Is that something that should be addressed in this process? Is that going be?

[Dr. James McDonald]: Yeah. That that would have been an issue. If that was an issue, we wouldn't have received the money. You know, keep in mind, we applied for 200. We got $2.12 Right. Which was nice. Know what mean? So I I think it's got practice issues, as important they are, didn't affect us acquiring funds for this particular program.

[Assembly Member Phil Palmesano]: Okay. My next question is more on some health insurance relative to, you know, I know the executive budget utilizes a portion of the proceeds from the managed care organization tab established in 2024 to provide $50,000,000 in state share funding for the mainstream Medicaid quality incentive program. This program is vital to encouraging the quality of enhancing the quality of care, addressing disparities, and to improve outcomes. Does that $50,000,000 fully fund this program? And if not, how much would full funding be for the state share?

[Amir Bassiri]: So fully funding this program, I believe you're referring to what it was at the highest point. And I would say the $50,000,000 that is included in last year's budget does not fully fund the program. It sort of brings it back to where it had been in 'twenty two. But fully funding the program, I believe, would be doubling that amount from prior periods. But it is a quality incentive program. So it measures performance based on quality, but the amount that is funding the program is discretionary. It is subject to budget negotiations and the executive.

[Speaker 10]: You.

[Assembly Member Phil Palmesano]: In a budget that increases Medicaid spending by $11,000,000,000 why is EMS a vital, as some would say, an essential mandated service, for a cut through the elimination of the Medicaid crossover payments for dual eligible patients?

[Amir Bassiri]: Thank you for the question. I would say that the proposal to align crossover payments, which are payments made by Medicare for cost sharing of Medicaid payments that Medicaid is making for Medicare beneficiaries related to cost sharing. So, the premiums, deductibles. Medicare imposes a 20% cost sharing on beneficiaries. Medicaid typically covers a lot of those expenses, but we have disparate policies and reimbursement depending on which Medicare coverage you have. We are just aligning those to a lesser of logic, which is consistent across the board.

[Speaker 0]: Thank you. We've been joined by Senators May, Hinchy, Borrelo. But our next up is Senator Helming, Ranker for Insurance, five minutes.

[Speaker 7]: Thank you to the panel for your testimony. I appreciate it. Commissioner McDonald, as I think you know, I'm very concerned about the current status of health care in our rural communities. Access is a challenge. The comptroller came out recently a report that confirmed what we've been saying for years, what my constituents have been experiencing, that it's really difficult to access care, whether it's with a primary care physician, whether it's peds, OBGYN, and dental care, mental health access is a real issue. In the comptroller's report, he said that we have significantly fewer providers per capita than the entire rest of the state. So when I listened to your testimony, I was listening for key points. Like I heard about large pots of money, different initiatives, but nothing that was specifically addressed at improving access to care in our rural communities. I have heard from so many of my community health centers, my small hospitals and everything that their Medicaid rates you know, we could blame the federal government all we want. But for years and years, the state has underfunded the community health centers and our small hospitals with low Medicaid reimbursement rates. What are we doing to fix that? And also, I'll just throw in there, workforce is a real challenge. And I know in your testimony, you touched on a large investment in workforce. But again, I'm looking for what are we doing specifically to address health care in rural communities?

[Dr. James McDonald]: Yeah, sure. So we actually have 24 different workforce support programs in New York State. And some of those are actually specifically addressing rural communities. In our rural health transformation program, there is a specific pot of money for rural health workers. One of the other little programs, you may not have seen this yet, it's buried in your budget appropriation. There's actually a $3,000,000 investment for nursing homes in New York State to recruit nurses, rural area in particular. There's a $1,500,000 contribution from the state. You get $1,500,000 from the Center for Medicaid and Medicare Services and they're using money they get from fines, civil money penalty, so that's a good one as well. But of these 24 programs, many of them do help people. And keep in mind, the scope of practice changes matter, right? You need PAs, independent practices would help in rural New York. There's actually a lot in rural New York this year. This is the most robust budget I've

[Assembly Member Scott Gray]: seen for

[Speaker 21]: rural New York.

[Speaker 7]: So are we going to track and measure that we're, through these investments, we're seeing improvements in our rural communities? Because I think that's been an issue in the past. The other, I think a couple of my colleagues have touched on, while there may be funding that's allocated, it's not always moving. Not only to our hospitals, like we had the Part 340B program that was changed and I think some of our providers were promised funding to make up for some of the loss they experienced there. My understanding is that has not happened with all of our providers yet. And even, you touched on clean drinking water programs in your testimony. You talked about the lead line replacement program. The controller did a report on that too. And guess what he said? A lot of that money is not moving. It's sitting. Wherever it's sitting, I think the comptroller is critical of the Department of Health in not having the proper mechanisms in place to move that money out. So I want to know, feel more confident in reassuring my constituents that everything possible is being done to improve access to care in rural communities.

[Dr. James McDonald]: -So the money that we're talking about this year, the $415,000,000 is already allocated money and contracts are already done. So this money is actually going to be is, in many ways, already out the door and actually moving. So and of course, we evaluate how effective these are. But we can actually we have data about how many people apply for loan repayment, whether they're doctors or nurses. We know this, and we know the money is going out the door. And, you know, worried about the controller. I appreciate his independence, and I appreciate that audit, and I understand what he's saying there. But keep in mind, you know, we learned from what the controller's feedback is, but, you know, a lot of what we're looking for when it gets water money out the door, in particular, we need municipalities to come along there. One of the big things to

[Speaker 7]: come out said of was they municipalities had quick guidance. Just want to real quickly ask, are FQHEs, community health centers, my rural hospitals going to see an increase in Medicaid reimbursement rates?

[Dr. James McDonald]: So the money that we have so far for federally qualified health centers, which are very near and dear to me, is coming from the health care stability fund from the MCO tax. And as I touched on earlier, we would love to get that money out the door. We were hoping to partner with you about a methodology for how to do that. In other words, we have to have J.

[Speaker 7]: About all this potential savings through the reports that the comptroller has identified, like where people who don't live in New York State are receiving New York State funded Medicaid programs?

[Dr. James McDonald]: J. Can take that.

[Speaker 7]: There are so many programs. Can we do a better job of making sure that people who are on these programs actually should be on it? Can we take any savings and put that towards my rural health care providers?

[Speaker 22]: J.

[Amir Bassiri]: So I would say that we work very, be happy to talk to you after offline answers.

[Assembly Member Gary Pretlow]: Thank you

[Speaker 23]: very I didn't get

[Speaker 7]: to mention nursing homes, but that is another area of the responses that I've gotten from DOH.

[Speaker 0]: Thank Senator.

[Speaker 7]: Not good. Thank you.

[Assembly Member Gary Pretlow]: We've been joined by Assembly members Lucas and Steck. Our next questioner would be Assembly Member Lunsford.

[Assembly Member Jen Lunsford]: That's faster than I was expecting. Good morning. Commissioner, you know that our six academic dental centers provide care for hundreds of thousands of New Yorkers. In Rochester alone, they serve a 55 county region and have a 35,000 person three year wait list. I didn't see much in the governor's budget about oral health this year. And given the burdens that we're going to see in our emergency rooms, I'm worried that if we're not investing in preventative care, we're going to overburden our emergency rooms with preventable oral health emergencies. What can we do in this budget to bolster oral health?

[Dr. James McDonald]: Yeah, so I think a couple of things come to mind. One is I think we need to support community water fluoridation, which is under attack from the federal government. You know, that's something that's been around for decades and works. One of the things I would look at, though, is, you know, there's been proposals in this legislature about different people who can do different things in oral health. Dental therapists, some states have done it, New York hasn't. The bills have been introduced, they just aren't going anywhere. But I think we need to look at, like, creating a dentist takes an awful lot of time. What you need is more people who can do dental care. Know, dental hygienists, another example of like, how do we do that? Now, of our workforce programs will help more people go into health care like dental hygienists, but I can't actually point them towards becoming a dental therapist because there's no space for them. But I think, keep in mind, we have a lot of health care workforce programs. They're going to work. I'm sure they will. There's a lot of them. But we could use a little help in that space as well.

[Assembly Member Jen Lunsford]: Thank you. Over the last year, my district has lost roughly 130 assisted living beds. We talk a lot about skilled nursing care in this room, but assisted living is obviously an important part of the continuum of care. What can we do in this budget to better support our assisted living facilities?

[Dr. James McDonald]: You know, a couple of things come to mind. One is, you know, people need health care workers, but they also need nursing homes to be decompressed as well. So there's, I think one of the things we should look at is how do we invest in nursing homes. But I think for assisted living in particular, you know, although they may not be a specific call out, a lot of what they're looking for is health care workers. Same with nursing homes as well. And it really gets that larger health care conversation as well. But New York actually has a lot of assisted living programs as well, which is good.

[Assembly Member Jen Lunsford]: I think they're just closing at a disproportionate rate. And, you know, my district in particular was hit relatively hard. Two budgets ago, we secured a 5% increase for our early intervention providers and they have still not received it. I'd like you to talk a little bit about the status of that.

[Dr. James McDonald]: Yeah. So they got the 4% rural modifier, which really was a bit of a surprise because we submitted that with the state plan amendment after the 5%. But the 5% rate increase, which is really important to them and important to me cause we really need to do that increment, will be retroactive to when we submit it, but it's been stuck with the with Center for Medicaid Medicare Services. We interact with them quite a bit in this. We told they were told they told us they were inundated by what happened during the shutdown. I think they're digging out of that hole, I'm optimistic it'll be approved in near term.

[Assembly Member Jen Lunsford]: Alright. And in my last fourteen seconds, I'm just going to put in a plug to have the governor continue her promised support for a three year transition off of 340B. At this time when our hospitals are dealing with issues from the federal government. We just need to make sure we bolster that program. Thank you.

[Speaker 0]: Excuse me. Next up is Senator Skouffis.

[Senator James Skoufis]: Thank you, chairwoman. Thank you to the panelists for participating. My questions are for Commissioner McDonald. Good to see you again. Does William Sachs, associate attorney at DOH, still work at DOH? Are you familiar with Mr. Sachs?

[Dr. James McDonald]: Yes. Will Sachs is one of our attorneys.

[Senator James Skoufis]: Okay. A couple years ago, after extensive conversation, he made it explicitly clear that in order to digitize your vital records, the statute that governs this section of law needed to be updated, which is why I'm a little surprised that on October 9, your department was directed to undertake digitization without any statutory change. How is that effort going and do you agree that that is, given that context, a bit strange?

[Dr. James McDonald]: Yeah. So I we've actually looked into this. As far as we know, we do not need legislative authority to digitize the records. And keep in mind, you know, when we digitize the records, this will help us with people who have living records but also with genealogic records as well. So I think this is gonna be a nice investment for New York. It's $5,000,000 this year and there's more in years subsequent to that.

[Senator James Skoufis]: But you were directed on October 9, so how is the effort going?

[Dr. James McDonald]: I can't I haven't monitored that in particular here. Mean, I'm not exactly sure what you're talking about. What I'm talking about is the

[Senator James Skoufis]: buzz Has there been any movement forward to begin this undertaking?

[Dr. James McDonald]: I know my staff is digitizing It's five

[Senator James Skoufis]: months later.

[Dr. James McDonald]: Yeah. But I know the staff is digitizing record. I'll have to get back to you on the progress on that. I know we've done that. I know it's helped with some of the backlogs we've had. But I can't give you like in a metric we've done this many thousands Okay, or 100,000 please

[Senator James Skoufis]: do get back to me. Oftentimes at these hearings when commissioners, not just you, offer to get back to us, we never do hear back. But please do get back. In this same vein, there is legislation pending that would create a public private partnership to digitize these records, you may know, at no cost to these states. Yet we are now considering spending millions of dollars to do this within Department of Health. Why wouldn't we do this for free?

[Dr. James McDonald]: Yeah, so I can't speak to any pending legislation. What I can say though is that when you look at what we're digitizing, it's records of people who are living but also the final records I think it's important to mind that, like, we need the records digitized and we don't need legislation if we wanted to contract with the vendor. So if we choose to contract with the vendor, we could do that.

[Senator James Skoufis]: That's contrary to the your counsel's guidance a couple of years ago. But nevertheless, how long is this gonna take to digitize all the records within DOH?

[Dr. James McDonald]: It's a three year plan.

[Senator James Skoufis]: Three years to update digitization when this could be done literally in a matter of months in a public private partnership. Again, why would we want to choose bureaucratically taking three years over several months?

[Dr. James McDonald]: So, know, I appreciate where you're going with this, I don't think we're bureaucratically choosing anything. What we're trying to do is just digitize a

[Senator James Skoufis]: record We're choosing a more expensive and slower way forward. That strikes me as sort of what, in many people's minds, typical government. And so I would urge DOH to reconsider your position.

[Assembly Member Gary Pretlow]: Thank you, senator. Assemblywoman Forrest?

[Assembly Member Phara Souffrant Forrest]: Good morning, everyone. My first question is to Medical Director What is Department of Health estimate of how many New Yorkers will lose insurance due to the changes in the

[Speaker 0]: essential plan eligibility? Thank in

[Amir Bassiri]: you for the question. Budget, as the commissioner said in opening testimony, assumes the worst case scenario. And currently under state law, the state is obligated to cover certain populations, lawfully present members, whether they're in the essential plan or not. That's why the cost in the budget assumes that those individuals don't actually all lose coverage. They would get state only funded coverage.

[Speaker 7]: But do

[Assembly Member Phara Souffrant Forrest]: have an estimate as to the number of how many might lose? What are we covering for?

[Amir Bassiri]: So in terms of who may lose, it's very hard to give you a precise estimate. Because some of the individuals in Essential Plan V, it's about 450,000 No question. Will be going and have the option to choose on the marketplace.

[Speaker 7]: Some may

[Amir Bassiri]: be eligible for Medicaid. It's unclear.

[Assembly Member Phara Souffrant Forrest]: I do have another question for you. Thank you, Mr. Pesiri. How many people do you expect to lose coverage due to the Medicaid work requirements?

[Amir Bassiri]: Our initial estimates were rather high based on the preliminary version, but we're saying up to one point five million due to work requirements and other HR1 changes. The work requirements number is between seven fifty and 1,000,000.

[Assembly Member Phara Souffrant Forrest]: Seven fifty and one million. So the executive budget projects no enrollment loss within Medicaid in the next five years. Could you explain the discrepancy between your estimates and the executive budgets?

[Amir Bassiri]: Yes, absolutely. I mean, some of what the executive budget and the financial plan is including is sort of the average monthly enrollment, not sort of the point in time each moment. So for something like work requirements or other eligibility changes in HR1, there may be periods of time where someone's ineligible, not permanently ineligible. So there would be churn in the program. But I think another piece of information prior to those original estimates, there has been some federal guidance put out that has given some hope with respect to the work requirements in that an individual can meet that with $580 gross monthly income, which in New York City is less than part time employment.

[Assembly Member Phara Souffrant Forrest]: That is less than part time. Yeah. So it seems like there's a lot of people that are at risk for loss. And, you know, commissioner McDonald, I didn't forget you. I do have some questions that will follow-up with you regarding safety net hospitals like Brooklyn Hospital Center that is at the cusp of bankruptcy, but we need to talk about that later. Thank you.

[Speaker 0]: Thank you. Senator Griffo.

[Senator Joseph A. Griffo]: Thank you, Doctor. McDonald. Last year, we ultimately were successful in allocating additional appropriations to the Upstate Medical Center, which as you know is a backbone of the Central New York health care system. In our conversation, you've not only acknowledged its importance, but you expressed your love for the institution also. I think it's very important that we recognize and address and support documented needs before they become and reach critical need status. The current executive proposal continues to support, Downstate Medical Center with additional $100,000 for operating assistance, is needed and understandable. But there is no similar allocation for the Upstate Medical Center again this year. So next week, the thirty day amendments are due. Can you tell me what you can or will be able to do to advocate for similar support, action, allocations for the Upstate Medical Center this year?

[Dr. James McDonald]: So just as a point of clarification, Senator, Downstate's getting a $100,000,000, not a 100,000?

[Senator Joseph A. Griffo]: A 100,000,000. Yes. Correct. I'm sorry.

[Dr. James McDonald]: And just, you know, as far as Upstate Medical Center, you're right. They're a quaternary medical center. They're unlike anything else New York State in many ways. They really do an amazing job. But I can't speak to what could be in the thirty day amendments. What I can say is I meet with their leadership often, and I hear very frank conversations about them. They have a really good leadership team. One of the concerns I hear more and more from them is more so just how hard it is to work within a state system. You know, for example, they're trying to upgrade their Epic electronic health record. Twenty seven months in the process and still hasn't gotten it updated. That's part of what's driving cost for them too, though, is not being able to function outside the state system.

[Senator Joseph A. Griffo]: But do you believe they should get that that parity should be established based on the critical need that's already been documented? That you would go to bat and say it makes sense to allocate an additional 100,000,000 for upstate as well this year. And you have the thirty days due in about a week.

[Dr. James McDonald]: Yeah. Thirty days due in in think parity is an interesting word there. Keep in mind, Downstate Medical Center has different needs than Upstate Medical Center. It's a very different you know, one of the things about the Stony Brook, Downstate, and Upstate, they're very different hospitals and they have very different missions, so they're just very different. So I can't get into what's going be in the thirty day amendment, but I appreciate what you're saying. I think we all agree we like Upstate Medical Center.

[Senator Joseph A. Griffo]: Hopefully we'll see it in action also. The, doctors across New York, great program, great need for recruitment and retention across the state, number of ideas that we have submitted and others have. What can we do now to try to address this critical shortage across the entire state, but particularly in rural areas and Upstate?

[Dr. James McDonald]: Yeah. So of the 24 workforce programs we have, several of them are actually geared towards physicians, not just the Doctors Across New York program, but the Healer program. So there's a lot of money for loan repayment. I think those are really critical investments. However, the Rural Health Transformation Grant has nice investments for workforce as well, and it's workforce of not just physicians. Because one the things we realize, we need doctors, we need nurses, we need PAs, we need nurse practitioners, the list goes on and on. And we actually just need people just to do all kinds of things in healthcare.

[Senator Joseph A. Griffo]: And I think we need a more comprehensive, aggressive plan too, and to be real creative. Thank you.

[Amir Bassiri]: Thank you.

[Assembly Member Gary Pretlow]: Thank you. We've been joined by Assembly members Souffrant Levine, and McDonald. Next questioner will be Mr. I'm sorry, Assembly Member Otis.

[Assembly Member Steve Otis]: Commissioner, nice to see you. And I wanted to ask you to talk a little about what the Department of Health is doing, and I've been in touch with your staff about Alpha gal syndrome, which is a tick borne disease that can be fatal, causes allergic reaction to mammal based products. And not many people know about it, but I understand the Department of Health is looking in the upcoming months providing a public information campaign to alert people to the risks of something that is growing in the Northeast and in New York State.

[Dr. James McDonald]: Yeah, so thank you, Assembly Member Ortiz. I don't think most people actually know what alpha gal syndrome is. You're right, it's a tick bite, but then put someone on the end being allergic and it can be life threatening to just red me. This is new, I think, for people to understand this concept. It's not a new disease per se, but something we're recognizing. So we're actually creating a webpage to help describe what it is. But more importantly, I think, trying to get a better gender prevalence of this. And one of the ways we can do this is using the All Pair Claims database to actually get prevalence of this here as well, just to get an idea of where it is. And I don't think there's as much known about this nationally as need to be. So I think this is a good example of where the New York State Department can to the larger national conversation about this, because it's not treatable other than avoiding red meat, which is hard to do, quite frankly. And it really can be life threatening. So it's legitimate concern that we're going to try to do something meaningful for 2026.

[Assembly Member Steve Otis]: J. I know there's a whole team at the Department of Health working on this. I'm going to make a pitch for mandatory reporting as part of keeping score and giving better information to the public about what counties there is a spike. And we're going to come into tick season soon once the snow melts. So thank you for the good work of the department. I appreciate that. Also want to kudos to the Department of Health in terms of the clean water funding and for drinking water, which the department has been doing a great job. But what we understand is the need far outstrips the amount of dollars that we have. So we in the legislature are certainly pushing for more money for drinking water and for wastewater

[Speaker 22]: grants.

[Dr. James McDonald]: Yeah. Thank you so much. And there is $750,000,000 in the governor's budget for water infrastructure. You know, and keep in mind, it's way more than lead service line replacements. You know, one of the things the department does every day is deal with water disruptions across New York State because of this aging infrastructure. But that money is being managed by Department of Environmental Conservation, and we have a say in that too, but it's really about managing water infrastructure, but also sewer as well, you know, and wastewater in particular. So there's a lot of work we need to do in water, and we work with the environmental facilities corporation as well with all this. And we enjoy robust partnerships, but everybody needs water. And one of the things about this winter in particular, it's been tough on water systems because I I'm optimistic about the snow melting eventually too, by the way.

[Senator James Skoufis]: Thank you. Commissioner.

[Speaker 0]: Thank you. Senator John Liu.

[Senator John C. Liu]: Thank you, madam chair. I wanna thank our commissioners for joining us once again, and a special welcome to acting superintendent, Kaelyn Estro, who I must say, your testimony is refreshing because the last few times that we've had the DFS commissioner here, well, let's put it this way. You have four pages of testimony directly addressing issues of health insurance that our constituents are very much concerned about. In contrast to last year's 28 page testimony covering everything from banking regulation to cyber security to cryptocurrency, basically taking credit for everything short of inventing the Internet. So thank you so much for your attentiveness to these issues that we all need to deal with. And because we are dealing specifically with health insurance. And by the way, after all the testimony last year, we were only able to ask questions about health insurance. But in any event, I I do have, what I think is I mean, it's probably a pretty narrow issue, but it's an issue that's important to many of my constituents. And that is, that, diabetes is on the rise, I think throughout the population, but diabetes is on the rise particularly within Asian American communities affected my family directly. And, you know, nationally, the insurance companies, there's a there's kind of like a rule of thumb that says if your BMI is twenty five or over, you'll get diabetes training and the insurance companies will cover it. But if it's less than 25, then it's deemed not not required and therefore not covered. And what I'm asking is if your department could maybe help look into this issue for Asian Americans. It's not that it's not a problem but obesity might be less of a problem but there's a national campaign to require the diabetes screening beginning at BMIs of 23 as opposed to '25. I think that insurance companies should cover this. Mean, diabetes screening, we're talking about anywhere from $25 to maybe $150 tops. And if we're able to catch the diabetes early on, it saves a lot more money than having to treat it. So if we can work together on advancing legislation or even regulation that will require our insurance companies to cover diabetes screening both beginning at '23, that would be super helpful.

[Caitlin J. Azar]: Thank you for that

[Assembly Member Phara Souffrant Forrest]: and I

[Speaker 31]: look forward to working with you on it.

[Senator John C. Liu]: Thank you. Thank you, Madam Chair.

[Assembly Member Gary Pretlow]: Thank you, senator, and I wholeheartedly agree with those statements. Assembly member Gray.

[Assembly Member Scott Gray]: Thank you very much. Good morning, commissioner. I wish well, I wish it was a good morning, but it is not. So your department controls many different funds, discretionary safety net funds, distress provider assistance program, program. North Star Health Alliance this morning declared bankruptcy. That includes Claxton Medical Center, Carthage Area Hospital, Meadowbrook Assisted Living, Meadowbrook Terrace, host of community clinics, dialysis, OB, oncology, wound care, behavioral health. We have been for months trying to engage with the Department of Health. Three weeks ago, the CEO resigned. The engagement has been going on for months, we've expected management services agreement. I emailed your office yesterday at 11AM expecting, warning you that this was going to happen. So what is the next steps for these services, for this community and for everything that's going on in this in this program?

[Dr. James McDonald]: Yeah, so as I remember, healthcare is really important all over the state but it's really important in in North Country, right? Because it's a rural community, right? You know, I'm actually involved with North Star every single day. And I know Assistant Commissioner Katz talks to you often, I know Associate Commissioner DeRoche talks to you often as well. I think the department's been exquisitely highly engaged on North Star. We've been very high touch. I want to thank the board chair, Chet Trotsky, in particular. He's been a breath of fresh air, quite frankly. But quite frankly, the department has had very simple questions we've been trying for a very long time to get answers to that any organization should be able to answer, and we haven't been able to get them. Only until recently have we gotten the information we needed. Now having said That's that recently,

[Assembly Member Scott Gray]: and I asked I I put a specific request in to send a team up to the North Country and to help them produce that information. Right? So we we are failing in the North Country and all this is good. Right? Whatever whatever we wanna say, it doesn't matter today. They filed bankruptcy.

[Dr. James McDonald]: So filing bankruptcy is is something they chose to do. And when I look at why, and I'm just beginning to understand why, I understand what they did. And that type of protection is probably a very good thing for them right now. I cannot get into confidential conversations that I'm having with my team and them to try to find a sustainable path forward. What I'm trying to do is find a sustainable path forward for the North Country. There's a lot of stakeholders up We've there that have raised

[Assembly Member Scott Gray]: got twenty seconds left. The sustainable path forward should have been management agreement, should have been executed weeks weeks ago with CEO. We we're the ones that forced that decision for the CEO to step down. Right? Chapter 11 bankruptcy doesn't do anything for the vendors, especially the local vendors that are owed money from

[Dr. James McDonald]: this facility. So respectfully, assembly member, I think you're discounting the impact of failed leadership there, which is really the critical issue.

[Speaker 0]: Thank you. Senator Fernandez.

[Senator Nathalia Fernandez]: Good morning. Thank you so much. You mentioned it before about the decrease in overdoses. And I wanted to ask if you could talk about the Office of Drug User Health and the AIDS Institute and what they're doing in terms of harm reduction in the realm.

[Dr. James McDonald]: Yeah, so the AIDS Institute is one of the bright spots of public health on the planet, quite frankly. So we are seeing progress with decreased overdose deaths, and you've been helpful in that regard, by the way, I want to thank you for that. I really appreciate your support. One of things the Office of Drug Use we look at disparities, right? In other words, I'm seeing disparities. We're seeing declines, but not for everyone. So the Office of Drug User Health right now is focusing on why are we seeing disparities among people who identify as black and how can we mitigate that. They just put a media campaign forward called Unfiltered, which I think is really intriguing. We're doing more targeted outreach, though, as well, into these communities as well, to put harm reduction in the hands of people, quite frankly, where they need it. And we're doing more to promote medication assisted treatment as well. Keep in mind, the department's been the foundation of the overdose response in New York State since the 1980s. We just put a website up together, by the way, called health.ny.gov/overdosefreegeneration. It's got

[Speaker 7]: all You of our also have talks

[Senator Nathalia Fernandez]: a agenda. The Department of Health has a prevention. Can you speak

[Assembly Member Nikki Lucas]: a little about that and what

[Dr. James McDonald]: is Yeah, this delivered the prevention agenda this year as well, which is something I'm very excited about. And that's a partnership with all these organizations, hundreds of community based organizations, but it's a state health improvement plan. But really that's a menu of evidence based strategies that work for everything, whether it's overdose or anything really. Really it's about working with local health departments, community based organizations, really anyone who does public health to say, what do we know works? So we have a webpage about this and we're tracking our progress.

[Senator Nathalia Fernandez]: You have a drug prevention I mean, I'm sorry, a drug checking program

[Dr. James McDonald]: Yes.

[Senator Nathalia Fernandez]: Right now, too. Can you talk about the data that you receive from this program and what that data is useful in combating our current overdose?

[Dr. James McDonald]: Yeah, so, you know, Doctor. Holgrave is our emerging drug threat coordinator. That's something we started new in '25. But when we do drug checking, we actually see what are the drugs that are in the supply, what are people using. For example, we put out a release this year about metatomidine, because we're seeing now this is showing up in drug overdose deaths. This is new. Part of why we're doing emerging threats is so people can see, like, you get the data, how do we tell people about it? Because the way you prevent a metatomidine overdose isn't the same as if you had a fentanyl overdose. This is how we

[Speaker 33]: do So drug love

[Senator Nathalia Fernandez]: this program. We want to support it.

[Dr. James McDonald]: It's a wonderful program. I think

[Senator Nathalia Fernandez]: we might want to codify, too.

[Dr. James McDonald]: It's a great program and they do wonderful work there. We're seeing wonderful data from this, by

[Speaker 7]: the way.

[Senator Nathalia Fernandez]: Thank you. And then the tax of the nicotine products, what is the goal of this tax? Where is that money going?

[Dr. James McDonald]: I'm sorry, lost your

[Speaker 7]: audio there.

[Senator Nathalia Fernandez]: The nicotine packet tax? Yeah. Where is that money going?

[Dr. James McDonald]: I'm hoping to me. It's planned for the FY '28 budget. There's supposed to be $50,000,000 in the Health Care Reform Act fund, but that's an FY '28 budget, so I'm hoping it's mine. We'll see.

[Senator Nathalia Fernandez]: Okay. So we don't know yet if it's going go to prevention or anything

[Dr. James McDonald]: like that? We don't no, it's not been spoken for yet. Okay. But if you have ideas, we're open to collaborating.

[Senator Nathalia Fernandez]: Have ideas.

[Dr. James McDonald]: Thank you.

[Speaker 34]: Thank you.

[Speaker 0]: Thank you.

[Assembly Member Gary Pretlow]: Thank you, Assemblyman Slater.

[Assembly Member Matt Slater]: Thank you very much, Chairman. I appreciate it. Good morning, Commissioner. I appreciate you joining us once again for this hearing. I wanted to revisit your comments on the medical indemnity fund. Specifically curious over the rate change proposal, because I've heard from constituents who are obviously quite concerned about the rate change and their ability to actually seek the necessary help and professional help that their loved ones require. Can you please speak to the change that you proposed in the budget?

[Amir Bassiri]: Yes, thank you, Assemblymember. Appreciate the question. What is advanced in the budget is similar to what the executive advanced last year, which is to tie the reimbursement of services in the medical indemnity fund to Medicare in most instances. And where Medicare rates don't exist, it would be the Medicaid rate. And that is specific to private duty nursing for which Medicaid is the primary payer. As we look at the current reimbursement methodology, it's impossible to even predict how high it can go. It's based on a fair health benchmark schedule that I can tell you nobody uses. And it's very, very variable and unjustified in terms of the increases. Many of these providers, particularly for private duty nursing, they're the same providers that serve millions of Medicaid members. And the Medicaid rate has been increased over time. It's enhanced for private duty nursing. So in most cases, we think the Medicare rate is sufficient. Ninety nine percent of all health care providers participate in the Medicare program. And then in instances where it's not available, we think the Medicaid investments in private duty nursing should be more than sufficient to meet the needs of the recipients it meets the needs of all Medicaid recipients.

[Assembly Member Matt Slater]: Thank you. I don't mean to cut you off, but we've already chewed through all my time. I just wanted to quickly touch upon another question. Recently, congressional testimony highlighted rising plan denial rates often driven by automated or AI based utilization review systems. The testimony also highlighted that providers have also reported pressure to accept steep in network rate reductions or face contract termination with some contracts dropped entirely and large numbers of patients moved out of network abruptly. Destabilizing local care systems and forcing providers into arbitration simply to obtain payment for medically necessary services. Given those dynamics, are you concerned that this proposal is going to eliminate access to emergency care from specialists from Medicaid patients? Not specifically related to the myth, I'd like to hear your answer to that question.

[Amir Bassiri]: Yeah, absolutely. As we've been monitoring Medicaid managed care IDR disputes, the rate of growth is staggering. It is unjustified and is typically specialists who do not want to contract with the managed care organizations because they are getting commercial reimbursement by taking a Medicaid dispute to the IDR. So that is not what the purpose of the Medicaid And program we don't believe that the IDR should include Medicaid because the federal government didn't include Medicaid.

[Speaker 0]: Thank you.

[Amir Bassiri]: Thank you.

[Speaker 0]: Senator Dan Steck.

[Senator Dan Stec]: Here we go. All right, thank you. Good morning Commissioner. Thanks for being here. I only have three minutes so there's two things I want to touch on really quick but then I want to center on Medicaid reimbursement rates for nursing homes. First, I am glad that Assemblyman Gray brought up North Star filing chapter 11 that's right on the border of my district between mine and Senator Waljas in the North Country, as you know. And I've been watching this for several weeks now and we need to do everything we can. We can't afford to lose any more facilities in the North Country. Secondly, at the budget hearing for DEC, I mentioned this to the DEC commissioner, but it really falls under DOH, the village of Tupper Lake in Franklin County, 2,000 water customers. Long story, but the bottom line is that they need to make a capital improvement, 20,000,000 $25,000,000. The governor put $250,000,000 in the budget for water resources, obviously, $20,000,000 just in one facility that's gonna serve 2,000 customers. There's not enough money. I'm concerned though that Tupper Lake has been told several times recently there's no more money for them because they've been this is an old issue that they've been working on. So I wanted to just put that square in your plate, Tupper Lake, Franklin County, their water issue. Please have your people take another look. Anything we can do to help that village is appreciated. But I wanna talk about Medicaid reimbursement rates. Then the last time that a rebasing was done was in 2007. Public health law requires Medicaid reimbursement rates to be reasonable and adequate to meet the cost of efficiently and economically operated facilities. New York has not rebased the nursing home Medicaid rates since 2007 and costs have gone up since then obviously despite because of major inflation, sustained wage and regulatory growth and obviously recent state mandates. Even when one time increases are approved and now are provided an outdated base methodology leaves facilities underfunded and creates large disparities across providers and nursing homes across Upstate are closing an alarming rate. Just in 2024, the last remaining assisted living center in St. Lawrence County, United Helpers, was closed. So that's the largest geographic county in the state of New York and they don't have a single medic single assisted center. Why is New York state not rebased the nursing home Medicaid rates since '27 and how does DOH evaluate whether current nursing home rates are reasonable and adequate when the base year is two two decades old?

[Amir Bassiri]: Yeah, thank you for the question, Senator. Most of the Medicaid rates for most providers have not been rebased in quite some time. You are right in that the nursing home is back to 2007, but we are actually in the process per federal changes to implement a new nursing home reimbursement methodology. It is pretty specified in the federal regs as to what we're supposed to do. We're going through that. Data we're getting from the nursing home is inadequate for us to update these rates. So they're resubmitting them. They will be rebased.

[Senator Tom O’Mara]: When? I'll pay them off.

[Amir Bassiri]: Well, for the federal rules, we will have this data that the nursing homes have submitted probably by the summer. But I wanted to just clarify some of the minimum Thank changes have all been made on top

[Speaker 0]: you. Thank you.

[Assembly Member Gary Pretlow]: Thank you. We've been joined by Assembly members Blumencranz and Giglio. The next person asking a question is Assemblywoman Jessica Gonzalez Roxas.

[Assembly Member Jessica González-Rojas]: Thank you. Over the years we've amended the thirteen thirty two waiver to include health coverage for undocumented pregnant and postpartum individuals and adults 65. Can you share how the proposed transition to the thirteen thirty one waiver impact those populations? And if the thirteen thirty one waiver is not approved, what happens to that population in need?

[Amir Bassiri]: Thank you for the question, Assemblywoman. First, I'll start with the first. There have been some things proposed that have not yet been implemented. And I think you were referring to long term services and supports in the essential plan. That will not, could not continue in that thirteen thirty one scenario. For the comments on undocumented coverage and lawfully present immigrants, we believe very strongly per federal law that a majority of them, and specifically those who had been in EP one through four, should remain eligible for basic health program expenditures. And we are hoping that the federal government works with us to maintain coverage for at least 1.3 of the 1,700,000 people that are enrolled in the essential plan today.

[Assembly Member Jessica González-Rojas]: Thank you. The proposed executive budget also includes a proposal to maximize care management resources for the higher acuity children and adults by reforming the eligibility criteria for low acuity members. Given that people with mobility disabilities have greater health disparities than people without physical disabilities and the last revisions to the acuity screening did not factor in the needs of this incredibly vulnerable population. Can you explain how you'll achieve this goal without further harming this vulnerable population?

[Amir Bassiri]: Yeah, absolutely. And I just want to start off to say we're very, very sensitive to and caring for all people with disabilities. But I do want to specify that the Health Home Program, which I believe you're referring to

[Speaker 37]: Yes.

[Amir Bassiri]: Is very specific to individuals with chronic conditions, chronic needs, and who are in and out of the healthcare system. The intent behind the program is to come in, get stable you know, be stabilized, get into a good place, and then reenter the community. So it's not intended to be an ongoing supportive services. So I, you know, I would say that we have other programs to support those populations you're concerned about. And the change that we're making is really just to go from two qualifying conditions to three. It shouldn't impact a very large number of people. But we have seen a lot of growth in our health home program and just care management spending overall. So we want to be mindful of that.

[Assembly Member Jessica González-Rojas]: What other programs can they transition into?

[Amir Bassiri]: We are working directly with them. Believe the group, there are health plans we work with who contract with care management providers and other agencies. We're providing direct investment to services and reimbursement for programs that serve individuals with disabilities, like wheelchair repairs. We're updating policies. So happy to talk about this one offline for sure.

[Assembly Member Jessica González-Rojas]: J. You so much.

[Speaker 0]: J. Thank you. Next we have Senator Hinchy. Oh, there you go.

[Senator Michelle Hinchey]: Thank you all for being here. Really appreciate it and appreciate the time. I think you can hear first for the commissioner, I think you can hear, we have a rural health care crisis. And I actually thank my colleagues. I think this is maybe the first time we've heard this much about rural health care and rural hospitals in a budget hearing. In my district, I have two hospitals that serve exclusively very rural communities. One of them has a 90% of their payer makeup is public, Medicaid and Medicare. They are looking to now have to downsize services because their operating dollars just are not there. I have another hospital in the southern part of my district just outside that's looking for capital dollars. They're actually doing okay, but the way that our model they don't have, you know, $200,000,000 to be able to do a massive upgrade that they need in order to stay viable for the community that they serve. Both of these hospitals have applied for safety net transfer funds, and yet both still have not received them. I appreciate that it's a rolling application, but we often leave these hospitals on pending and hope that we can get back to them later. In my estimation, that can't be the plan. So are you all thinking differently about how to actually fund our hospitals or to support our hospitals in rural areas as opposed to throwing more dollars, which we need. I'm not advocating against it. We need more money in these programs as they exist because they're oversubscribed. But what else are we doing to actually help our rural hospitals?

[Dr. James McDonald]: Yeah. So I appreciate your question here. I think there's actually a lot going on this year with rural hospitals. So the Safety Net Transformation Plan is, again, proposed for $1,300,000,000 this year. So just because it's a rolling application, keep in mind pending is better than no. Think Of

[Speaker 23]: course. But

[Senator Michelle Hinchey]: least we know it's oversubscribed, so those dollars are important, but we don't know if they'll actually get it.

[Dr. James McDonald]: No, I know, but keep in mind, now there's 1,300,000,000.0 more on the table if we get the budget approved the way it's designed here. But there's actually a lot of investment this year at the Rural Health Transformation Program. Rural counties actually have something. This is $212,000,000 per year for five years, And there is opportunity for them to do things. Now keep in mind, I talked about the procurement flexibility we need. If we do not get the procurement flexibility, I just want to put this out there, we might have no money for anybody. Have to have all this money allocated by October 30. That's eight months away. But I just want to keep people in mind that and then we're doing a lot in workforce for rural hospitals.

[Senator Michelle Hinchey]: Totally. Appreciate that. I mean, think that there's more than the billion dollar need in the Safety Net Transformation Funds, which is great that we have that money. I think we're all even advocating for more dollars, but it's not a solution. And so it's a short term solution, but we're still oversubscribed. In the federal money that you're talking about, and I appreciate that we have that $212,000,000 for our rural hospitals is not that much money when you look across the board. But two, one thing in that program is the use of AI. And my concern is that we're going to start utilizing that in a much more robust way and actually lose access to doctors in rural areas and implement technology instead. I look forward to a response. Thank you.

[Assembly Member Gary Pretlow]: Thank you, Senator Assemblym Boris.

[Speaker 0]: Before you start, Alex, sorry. I should have said it earlier, and it's clearly true today. When people are asking you questions and then you don't get to answer because the clock goes off, we would really appreciate if you're gonna follow-up. Follow-up in writing to Gary Pretlow and myself, and we'll make sure all the legislators get your answers.

[Dr. James McDonald]: So that will happen, and your point of contact for that is assistant associate commissioner DeRocha. She will ensure she's here right now. She'll make sure that happens. Anything we said we'll follow-up on, Her team is taking notes. They will follow-up, you'll get a written response.

[Speaker 0]: Thank you very much.

[Assembly Member Gary Pretlow]: You're welcome.

[Speaker 0]: Because we have complex questions, you have complex answers, and we don't have a clock that gives you the time.

[Dr. James McDonald]: And we'd love to collaborate, and you need information to do that.

[Speaker 0]: J.: Thank you. And I apologize, Assembly Member Boris.

[Speaker 6]: J. Thank you, Chair.

[Assembly Member Alex Bores]: Thank you all for being here. Really appreciate it. Commissioner, last year, part Q of the budget expanded coverage for fertility preservation, the case of iatrogenic infertility, into Medicaid. It was a great success. Thank you for advocating for that. I was wondering if there was an update on rules and regulations that went into effect October 1. We worked with My office worked with DFS last year to update the regulations for private insurance covering it and was wondering what's the status of people using that or regulations around it.

[Dr. James McDonald]: Yeah. So I think it's an important issue, right? Because, you know, when people have to have a medical reason for infertility, it's incredibly tragic, right? So we did submit a state plan amendment to the Center for Medicaid and Medicare Services. When it gets approved, and I'm optimistic it will be approved, it'll be retroactive to October 1. I can't tell you how many people will benefit from this. You know, it's a small population, but an important population. So I'm optimistic it'll be approved in '26. We have to see. CMS, you know, they've got some little bumps going on right now. They're a little different to handle. But, you know, our people know their people, so we'll see where this goes.

[Assembly Member Alex Bores]: Great. There's a lot that's currently being held up by federal action at CMS, so I I sympathize with that and let us know if there's ways of of helping to speed that along. I was wondering if you have a latest estimate of the changes that we've seen from CMS and from the one big beautiful bill on its fiscal impact in New York. What are you expecting that to cost your department?

[Dr. James McDonald]: I don't know if I can give you an exact amount. Mean, there's very little in HR one that was virtuous. It was the rural health transformation program that was the most virtuous. I'm very concerned about the consequences of HR one. You know, quite frankly, the funding of ICE should bother everybody. The billions and billions and billions of ICE got, you know, just it was funded to do the horrible, cruel things it's doing, and that should bother every American. It concerns me that it doesn't. I know people in Minnesota who are definitely seeing the adverse public health impact and adverse clinical health impact, because quite frankly, people aren't going to the doctor in Minnesota because it's dangerous right now. They're not going to school in Minnesota because it's dangerous right now. You know, I do think it's important to know that the governor put in this budget a bill, that would help us to, frankly, keep people, ICE in particular, out of health hospitals.

[Assembly Member Alex Bores]: I wanna move you off of of immigration, but I appreciate that. I wanna ask about AI before my time is up. I'm not gonna ask you what the panel will decide ahead of time. The point is to have the panel. How are you thinking about who serves on that panel, especially people from a data privacy standpoint and AI safety standpoint?

[Dr. James McDonald]: Yes. Indeed. In in other words, it's a robust panel. Part of what I'm trying to do is what is going on in artificial intelligence health care. By the way, Epic, the largest electronic health record in New York state, has 90% of the New York market.

[Assembly Member Alex Bores]: I can assess yeah. Do you do you have when you're thinking of staffing that panel, are you thinking about specific roles for people with data privacy expertise and AI safety expertise?

[Dr. James McDonald]: Yes. Mean, many roles as possible. Like, we have artificial intelligence people at the department right now. We have expertise. We need more expertise, we need more talent to help us.

[Speaker 40]: Thank you.

[Speaker 0]: Thank you. Senator Ashby.

[Senator Jake Ashby]: Thank you, Madam Chair.

[Speaker 42]: I want to thank the panel for being here and get back to a topic that had been previously brought up. I think it would go to Director Vassiri. Can you explain the proposed elimination of the Medicaid crossover payments found in Part M?

[Amir Bassiri]: J. Yeah, absolutely. Thank you for the question, Senator. So today, New York State does not have a consistent reimbursement policy for individuals that have Medicare coverage who also have Medicaid, also known as dual eligibles. Depending on what Medicare coverage you have, whether it's A, B, and C, or a combination thereof, there is a different reimbursement that is, to be honest, nonsensical, but moreover is resulting in potential overpayment by Medicaid, which is partially why you may have heard me refer to issues like the upper payment limits in prior years. And us being at those limits, so we are just standardizing to a lesser of methodology, which is already what we do in Part A, to Part B and C, which would effectively be the difference between the Medicaid Medicare paid amount and Medicare charge amount. And if the But

[Speaker 42]: Medicaid is no longer contributing

[Amir Bassiri]: to those J. That's not true. It will still contribute. It will contribute the appropriate portion under a lessor of methodology.

[Speaker 42]: J. Medicare will continue to contribute, it seems, but it's

[Amir Bassiri]: No, no, no. Medicare, I just want to make sure you understand this, because Medicare actually applies a 20% coinsurance on the patient, which is what Medicaid pays, at least thereof. And all we're saying is, based on the logic, we're going to allow a consistent reimbursement as fiscal stewards of the program.

[Speaker 42]: Well, seems as though, because they're duly qualified for it, Medicare will continue to pay a more substantial rate than Medicaid, as has been, right? But the proposal in Part M zeroes out. It eliminates Medicaid's contribution from $80 down to zero. That's least not for fire ambulance services within my district. That's what's being reported.

[Amir Bassiri]: That's also not true. Ambulance providers and psychologists get paid 100%, meaning that 20% coinsurance, the full amount is paid no matter what. We are imposing a standard of it's called the lesser of methodology, which will calculate the difference between what Medicaid pays and what Medicare allows. If Medicaid is above what Medicare is, which happens, that will not change for Article 16, Article 31, Article 32. And if it's below, the difference will be applied and paid. We just won't pay up to the 100%. And at times, even the statute, the way it's written, we pay above what Medicare pays, which is why we can't get our state plan amendments approved by CMS because we are required federally to pay no more than what Medicare pays in aggregate, at least in fee for service.

[Speaker 42]: Appreciate it. Thank you.

[Speaker 40]: Sure.

[Speaker 0]: Thank you.

[Assembly Member Gary Pretlow]: Thank you. Assemblyman Anderson.

[Assembly Member Khaleel M. Anderson]: Thank you so much, chair. I'm going to try to get three questions in in my three minutes. First one is for Commissioner McDonald. The controller's report, the doctor's out, shows provider shortages. And although the rockways are not rural, we have provider and care access shortages. Will you commit to regulatory flexibility, including standards set by the American College of Surgeons, to expand access to emergency care? Second question for the superintendent. Congratulations on your interim status. What is your department doing to ensure insurance networks are adequate so patients can see providers without delays? And for our Medicaid director, how is your agency addressing fair hearing delays to prevent pauses or interruptions? Plus, how are you guys looking to address the Medicaid error rates and services?

[Dr. James McDonald]: So let me go first. Thank you. So I'll look at what flexibility I could have and see what's possible. You're right. The Far Rockaways are different. You know, it doesn't look rural. I get that. But when you go out there, I see it. I'll I'll see what's possible. We do have a lot of health care worker investments this year, though. They're really we do have, like, 24 different programs. But let me stop there so others can answer their questions.

[Caitlin J. Azar]: Yeah. Thank you for the the question. So network adequacy is essential. So we follow-up in terms of all of our carrier networks through examinations, and if we find issues, we can take action on that. Also, in 2022, we passed a a regulation, that if a network is is incorrect, then a consumer is held harmless and only pays the in network rate if it's mislabeled on a carrier website. And then I'll also highlight our network adequacy regulations, came online last year, and we've just followed up with a three zero eight letter to check for compliance in the mental and behavioral health space. That requires carriers to check on their networks and also to check that providers are accepting new patients and make that information available.

[Assembly Member Khaleel M. Anderson]: I'd love to get that regulation in writing because I do know of a constituent that went to a place that said a doctor was in network, and they weren't in network, and they got charged out of network price, and that's not right.

[Caitlin J. Azar]: Absolutely. Happy to

[Assembly Member Khaleel M. Anderson]: follow-up. Medicaid director.

[Amir Bassiri]: Fair hearing is a top priority for us right now. Under the public health emergency, we have some flexibilities and timeliness. But we've been working very closely with our colleagues at the Office of Temporary and Disability Assistance and Commissioner Gwynn, who is responsible for a predominant majority of the Medicaid fair hearings. What we're trying to do, Assemblymember, is impose what CMS and us have agreed to as informal dispute resolution, which helps members navigate a dispute, a denial prior to a fair hearing to see if we can help address the issue. So that's what we're doing right now.

[Assembly Member Khaleel M. Anderson]: J. I'd love to see that in writing, because I don't see my constituents faced with that. I often find myself getting them fair hearings, pushing them through the autodial process, because there's never that informal communication. But let's talk offline, because I have

[Senator Joseph A. Griffo]: ten seconds.

[Assembly Member Khaleel M. Anderson]: McDonald, really quickly, thanks for coming out to my district commissioner. I appreciate it. But you know exactly which bill I'm talking about in terms of flexibility with the ACS standards. So hopefully we can follow-up.

[Speaker 0]: Thank you. Thank you. I actually think I'm going to slide in with my ten minutes, since neither of our chairs Senator Rivera would like to go, I think, last. And I also like to go last, So we're splitting it up a little bit, having gone this long. So I'd like to follow-up on Assembly Member Anderson's just question about what I've been calling the ghost network, where and thank you, Commissioner. You did answer that there's been two changes in the rules in '22 and '25. But the data is so disturbing. I mean, you talked about in your testimony fraud in health insurance and a new division of fraud. So I believe the biggest fraud in health insurance are ghost networks. I'm paying for insurance. I'm paying for insurance. I go and I try to get a doctor to see me. And again, disproportionately it appears in mental health issues and substance abuse issues. And there are no doctors to see me. Oh, and also, at least in my neck of the woods, doctors not taking Medicare patients. Now granted Medicare insurance is federal, not state, but the networks say they take new patients. And when you go check, there are none who take new patients, at least not in Medicare, and mostly in mental health. And doctors are also being, I guess, scandalized because they are listed as being part of these networks when they are not. And they believe their reputations are being ruined because they are being told, you're supposed to be part of this network and you wouldn't take the patient. But they never signed up for the network. But they were put on so that the network looks like it's robust and has adequate doctors. And I'm addressing the questions to the insurance commissioner, but I believe it's Department of Health's obligation, Department of Mental Health's obligation. So we have these new regulations. We're supposed to be doing something. We have national studies coming out talking about between 3080% of the networks in this country are ghosts are filled with ghost doctors and their ghost networks. So I know that the attorney general just took on a lawsuit involving a case in New York City where the man committed suicide after he could not get any mental health services. I actually think it may meet the standards of criminal negligence, not just fraud. So how many cases are you taking up in your new unit, and how big are the penalties?

[Caitlin J. Azar]: Yeah. Thank you for that question. So I will state, you know, we very much appreciate the partnership with the legislature in, promulgating the network adequacy regulations and and, legislation, to make sure that we are addressing this issue, especially as you said in the mental and behavioral health space. So something, you know, I'll say, as those regulations came online, we were very proactive in putting out a call, just at the end of last year, to check on compliance for our carriers. And we were collecting that that data now and looking into that. So, based on that, we can start to take specific action around ghost networks. I think the law is unique in that, again, it's requiring carriers to review their networks on a cadence. So every year and sometimes in certain cases, every six months, also to put that, check on the doctors that they're actively taking new patients and providing that information to consumers. So we will, you know, provide the legislature with whatever information you need as we get more information. In terms of, you know, specific constituents who might have access issues, our consumer assistance unit is actively handling those cases. So across all of our agency, we fielded 50,000 New Yorkers complaints. And I watch, the traffic specifically with New Yorkers in handling some of these access issues. And then I will say, you know, we know and we're partnering with our colleagues across the state that just provider count, the number of providers, specifically providing mental and behavioral, treatment is lower than we need it to be. Right? We just need more providers available in these networks. So we are working on, you know, how do we get more of those providers online. So I'm hopeful that the combination of the legislation that you all passed, our oversight, which we are conducting right now, combined with kind of the whole state solution on mental and behavioral health will provide more solutions and then, you know, more consumer protections like we put in place in terms of holding consumers harmless, if they are not able to provide find that that correct provider.

[Speaker 0]: But but the governor did put out regulations, I think, July 25 with instructions for for both of your agencies and a few of the other agencies of actions they must take. I'm curious, have any of those actions been taken yet?

[Caitlin J. Azar]: So I'll have to follow-up with kind of the specific actions we take. But if if you're referencing network adequacy regulations in particular, yes, we've taken actions in terms of, again, providing instructions specifically to our carriers. We had an information request that we put out pretty soon after the promulgation of that regulation that now we're collecting data on that will enable us to take specific actions.

[Speaker 0]: Thank you. Shifting to myth, a conversation I feel like I have to have every year with Department of Health. So, again, for the record, I never thought this was a good idea when governor Cuomo implemented it, and I felt like it was gonna fail. And now we have years where the Department of Health, in their budget proposal, whether they agree with it or not, it's not the question, are saying that we have to reduce the amount of money being spent on meth by reducing the coverage for children who have been approved to be in MIF through the court system. And we did increase the reimbursement rate, I guess at 2013, 'twelve, forgot the year. We increased the reimbursement rate because your own research showed people were not able to get the health care for their children because the reimbursement rates were too low. And having a system for very sick children that is not providing them the health care they need isn't a really good plan. So we did legislatively increase the reimbursement rate and we found that the program was working more effectively for getting the children the care they needed. It was also increasing the cost. I suppose ironically, it was also ensuring the children live longer. And damn it, when children live longer, they cost more money over time. So the number of children going into MIF each year continued to go up while I think on the evaluations that were done early on in the program, the number of children expected to die by the time they were five wasn't coming true because they were actually getting the health care they needed and weren't dying. So now we have another year where we're being told the governor wants to reduce the money spent on MIF and reduce the reimbursement rate for care? And what do you think is going to happen if that were allowed to take place?

[Amir Bassiri]: J. So thank you for the question, Senator. I know how deeply you care about this issue. Do not agree respectfully do not agree with the notion that the higher reimbursement is the direct result of better care. As we look at these providers, they're the exact same providers that provide these exact same services to Medicaid beneficiaries. So I don't know how the higher reimbursement changes the quality of care, if it changes the staff, but I think to your earlier point, there had been challenges. The legislature and the executive addressed those with the increased rates. But I think we went from one extreme to the other, one being Medicaid and other being an indeterminate price that only goes up. And I think the proposal in this year's budget is a compromise and a reasonable proposal to align to Medicare reimbursement where appropriate. And it's really intended to sustain the myth because, as you know, we've had these annual discussions. And we really cannot afford and keep up with the annual benefit payments for the recipients and the MIF. Completely respect the higher quality of care, want everyone to have the highest quality of care. But we think this proposal should not compromise quality of care just by paying Medicare and where Medicare is not available, Medicaid, which is only one enhanced service.

[Speaker 0]: J. My understanding, based on conversations with some people in the program, is that the higher cost factor ties directly into private duty nursing.

[Assembly Member David Weprin]: Yes.

[Speaker 0]: And so that is very sick children. Right? And that I have to say, when I went out and looked, trying to find private duty nursing at Medicaid rates was not findable. Not in New York City. Maybe in other parts of the state. So is it the Department of Health's position is that if the only reimbursement rate for private duty nursing is Medicaid rate, we are actually going to be able to find the care these children need?

[Amir Bassiri]: I think that is our position because, as you said, there has been historic challenges, and I think this is an ongoing challenge. But we made investments in our private duty nursing rate pretty significantly. I think back in 2022, it was north of 30%, which has stacked. It's not, I think, at the commercial levels, of course. And I think there's room to talk about it being increased even further. But I think we've seen improved access.

[Speaker 0]: Okay. I wasn't done, but I'm done. So thank you very much.

[Assembly Member Gary Pretlow]: J. Thank you, Senator. We've been joined by Assembly members Giglio, C. Wright, and Simon. Our next question will be Assembly member Blumencranz.

[Assembly Member Jake Blumencranz]: Thank you, and thank you all for being here today. New York's total budget this year, $260,000,000,000 proposed, Medicaid accounts for $122,000,000,000 of that, up 37% in one year. Florida, a bigger state, bigger population, spends less than half of that

[Dr. James McDonald]: in its entire number.

[Assembly Member Jake Blumencranz]: Let's talk not just about enforcement, but also the potential and the dangers of fraud, waste, and abuse in our system. To the Medicaid director, my question for you is, do you think that New York State is sufficiently tackling fraud within our system today?

[Amir Bassiri]: J. Think that New York State is doing a great job, and we can always do better. J.

[Assembly Member Jake Blumencranz]: Okay. Do you think that the Medicaid inspector general is doing a good enough job to keep his job?

[Amir Bassiri]: I think that we work very closely with the Medicaid inspector general. You know, they have their oversight rules, regulations. Our role kind of ends when there starts in some instances. But I can't really comment on that. I think we work well with

[Assembly Member Scott Gray]: the office.

[Assembly Member Jake Blumencranz]: Your own data shows that Medicaid spending has nearly doubled in the past decade. And even while those who are truly needy, the disabled, the elderly, those populations are shrinking, Fully able-bodied populations continue to grow exponentially. When does this safety net of individuals who are not means tested? I mean, I think census data shows 3,000,000 people on Medicaid have the options that don't qualify.

[Amir Bassiri]: Yeah, that's J. Not true. This is a means tested program. There's two requirements you have to meet to be eligible. One is income. The other is residency.

[Assembly Member Jake Blumencranz]: J. Is there anything coming?

[Amir Bassiri]: STEPHEN There's

[Assembly Member Jake Blumencranz]: no means testing? Sorry, I couldn't hear you.

[Amir Bassiri]: You have to be income eligible to participate in the program. That's one of the two federal requirements. There's obviously exceptions, depending on whether you are pregnant or the type of person you are. But I want to just mention the reason that you comparing us to Florida is one thing. But as you look at our spend per person, where you see the increases are really in two areas the aging population, we spend $45,000 per member per year Disabled population, about $44,000

[Assembly Member Jake Blumencranz]: per just member per for time, that brings me to my next point, which is that fraud is an issue that I don't see as being tackled properly. A lot of people within my district, they come to me constantly say, why does this number keep ballooning? Whose hand is in the cookie jar? But accountability doesn't seem to have a face in New York. You have you have OMIG. You have the attorney general. DFS has their own prosecutorial arm that is doing investigations. But everyone seems to be pointing the finger at each other because there's no transparency. The numbers I see when it comes to prosecutions out of these offices are minimal at best, not doubling at the same rate of the money. How is your office going to change this? Should it be in a federal receivership? Should we be looking at places like Minnesota and saying New York is twice as bad?

[Amir Bassiri]: J. I think we're looking at this as a very as a top priority for us. Happy to work with you on your ideas to do a better job.

[Assembly Member Jake Blumencranz]: J. And I look forward to seeing more transparency from your department. Thank you.

[Speaker 0]: You're welcome. Okay. Thank you. Senator Webb.

[Senator Lea Webb]: Morning. Thank you all for being here. So I chair women's issues, there's I know commissioner McDonald, we've talked previously about efforts that the Department of Health is, trying to make with respect to addressing maternal mortality rates and, of course, reproductive health. And so I was a little concerned when I saw in the executive proposal to actually decrease funding for reproductive health programs. Can you explain where that is coming from and what's the plan, especially given what's happening in our national discourse around reproductive health?

[Dr. James McDonald]: Yeah. So there's several investments in this budget for reproductive health. There's 25,000,000 for capital, 20,000,000 for operating, and then there's a $100,000,000 committed to help Planned Parenthood with any impact from HR one. Those are the investments of I don't know not aware of any decrease in investment when it comes to reproductive health.

[Senator Lea Webb]: It's a decrease of 5,000,000 reproductive health program grants, and so I was just trying to understand why the

[Dr. James McDonald]: The $100,000,000 is new, to back to really backstop Planned Parenthood. The governor is supporting, reproductive justice in New York State. We she can't backstop everything, but she's chosen to backstop this. So that is new. That's significant.

[Senator Lea Webb]: Okay. And my follow-up with regards to maternal mortality rates. Again, this disproportionately impacts women of color in our state and most certainly women in rural areas. Can you talk about measures that you have taken since last year, your department, that are trying to close that particular gap?

[Dr. James McDonald]: Yeah, thank you for that. So there's actually 19 different initiatives going on right now at the New York State Department of Health to address maternal mortality. 10 of those are focused on reducing C sections. The five of those that are in Medicaid, four of them expanded coverage. One that I'll just give you an example of, though, is a financial incentive. We have $50,000,000 committed in this fiscal year for the financial incentive to reduce C sections in hospitals in the Medicaid population, and we did see some success in that. You know, I'm not happy with the progress I'm seeing exactly, but we went from twenty point nine percent in the Medicaid population in those hospitals in low risk to nineteen point nine percent. So that was significant. Across the state though, I'm not seeing the progress I'd love to see, but that's an example of something that's working.

[Senator Lea Webb]: And that's a lot of my concern and so I would like to talk offline about getting that data on what we're doing to address this issue. Similarly, we're looking through wounds issues on addressing the very real challenges around menopause. And so I was also curious what are some resources that DOH is looking into or has with regards to addressing menopause in our state? I know we're short on time and we can talk further offline about that, but that is a major concern where I'm unfortunately seeing that there's very limited things that we are doing in the state, and that's something I would like to speak further with you in your thoughts.

[Dr. James McDonald]: I'd love to help in that space. So I think there's some unnecessary we'd love to help.

[Senator Lea Webb]: Thank you.

[Assembly Member Gary Pretlow]: Thank you. Thank you. Assembly Member Steck.

[Assembly Member Phil Steck]: Thank you very much. This is for Commissioner McDonald. It relates to medically fragile children who receive a benefit of having private duty nurses come into their homes and take care of their children, which enables them to work and provide for their families. If the private duty nurses cannot perform that function, then the parents have to stay home. And it's obviously an economic hardship for the family. The difficulty is this is a good program, however, there's a tremendous shortage of private duty nurses, and so the parents are being forced to stay home and with devastating economic consequences for those families. First of all, has this issue come to your attention? And second of all, we have legislation that would allow minimal payment by Medicaid to the parents when they take care of the children to and other states have this also, like Massachusetts. Because without that, it's really devastating for these families. I'm wondering if you're aware of it and if the department has a position on this issue.

[Dr. James McDonald]: J. Yeah. So I think as a member, you're getting to the larger health care worker shortage in general, quite frankly. And we have 24 different programs right now, including programs that specifically help nurses. The nurse loan repayment has been really substantially increased in this year's, you know, allocation of funds. So, you know, health care workers in shortage, but our program is comprehensive in every regard as far as improving the number of health care workers. I think as far as, you know, a bill that you have proposed, I'm happy to have the team take a look at it, but I haven't seen the bill yet. And so I I don't wanna speak to it directly here, but I I'll I'll take a look at it and have the team see it. I'd love to collaborate and see what's possible here. Obviously these children need to be taken care of. J.

[Assembly Member Phil Steck]: D. We appreciate that and glad that we were able to bring this to your attention.

[Christopher T. Morton]: Thank you.

[Speaker 0]: Senator Barrella.

[Senator George Borrello]: Thank you, Madam Chair. This is for the Medicaid director. I've been harping for years about the fraud, waste, and abuse in the Medicaid non emergency medical transportation space. There's a great article in today's New York Post that outlines the tremendous amount of multimillion dollar fraud which has been uncovered and prosecuted by the attorney general. It's only scratching the surface because this fraudulent program is playing whack a mole. You've got countless people that are that are profiting off this at the expense of the taxpayers. And back in '2 in 2020, the Medicaid redesign team said that we should change this to from from a fee for service to a per member per month reimbursement. And so far, that hasn't happened. Can you explain why?

[Amir Bassiri]: Well, thank you for the question, Senator. Program integrity and fraud waste and abuse is obviously a top priority, has been, and specific to this issue that did come out this morning. So that change that you're referring to did happen. It was recommended, as you said,

[Assembly Member Alex Bores]: by the

[Amir Bassiri]: MRT-two. It was done through a competitive procurement. There was a protest, so it was a little delay. But it did officially start, like, in 2024. And some of the article that you referenced is actually specific to investigations and findings from prior to this broker being in place.

[Senator George Borrello]: Yeah, but the broker still seeing the same I don't mean to interrupt you, but my time is short. We are still seeing the same scam. I live in Western New York. You have taxi drivers from Buffalo driving down to Jamestown, sixty, seventy miles away, to pick up a patient in Jamestown and take them to an appointment in Jamestown, and then driving all the way back to Buffalo and getting paid mileage. That is not a change. That is not that's what's been going on.

[Amir Bassiri]: I completely understand what you're saying. I think you're referencing instances that occurred before the broker took effect because we imposed GPS monitoring, and that doesn't happen anymore. I'm positive about that.

[Senator George Borrello]: We're still seeing it. So what is the cost of this program now? Because when our our displaced former governor created this program, the cost shut up over 1000%. Where are we now?

[Amir Bassiri]: We are spending about $1,400,000,000 annually.

[Senator George Borrello]: Isn't that more than double it was when the county governments were dispatching these rides? Why are we still using taxis and not public transportation?

[Amir Bassiri]: J. I don't believe so. But I will say that the transportation broker has financial obligations to ensure that people take the most cost effective form of transportation, which may include public transport?

[Senator George Borrello]: Well, according to all my rural transportation networks, they're getting zero business. In other words, when we have a, you know, a a bus that's moving people around our rural areas because we have no public transportation, which is what was the most common use for this Medicaid, you know, for NEMT. They're they're getting virtually nothing. So I don't know how we changed this. The transportation brokers, I still see in my district people coming from, you know, Buffalo Airport taxi and others that are coming down to my district. I just don't understand how this has not changed.

[Amir Bassiri]: I'm telling you that it has and if they are, they're not getting paid by Medicaid.

[Michael Duteau, RPh]: I promise you that.

[Senator George Borrello]: Well, take your word for it.

[Assembly Member Gary Pretlow]: Thank you for those questions. Assemblywoman Souffrant Forrest:

[Speaker 49]: Thank you, Commissioner. Commissioner, do you believe that private equity ownership belongs in health care delivery, especially when you're talking about programs funded through Medicaid dollars?

[Dr. James McDonald]: So I think we all have a reason to be a little nervous about private equity because their incentives aren't necessarily aligned with outcomes. They're assigned with return investment to shareholders. You know, and there's a reason why New York doesn't have for profit hospitals. I mean, it's a legitimate concern.

[Speaker 49]: So given that, there's a reduction in the Medicaid quality incentive pool. So do you believe it makes sense to cut performance based funding for community providers while allowing private equity and others to extract value from that same Medicaid system?

[Amir Bassiri]: Assemblymember, can you repeat that? Did you say the cut to J.

[Speaker 49]: Yeah, the QIP program, the Quality Incentive Program.

[Amir Bassiri]: J. Yeah. So the QIP program, I think there was a legislative agreement the Medicaid budget last year to do the $50,000,000 that was jointly agreed upon. That's continuing. One of the concerns we've heard about that program is less about the community based providers, and it's more about whether the money we provide to health plans gets to the community based providers. So we are imposing new reporting requirements this year, but there's no cut to the program as compared to last year's enacted budget.

[Speaker 49]: Okay. What are you going do to make sure there's sustainable funding for the program moving forward after the end of the funding from the MCO tax?

[Amir Bassiri]: I look forward we look forward to working with you on that. I think we're open to thoughts from the legislature and ways to sustain that funding.

[Speaker 49]: Okay. I'm going to move to another topic. Do you believe that black, brown, and low income patients in vulnerable and under sourced resourced health care settings deserve the same access to specialty care as patients in wealthier communities?

[Dr. James McDonald]: Absolutely.

[Speaker 49]: Okay. So then if specialists are being pushed out of the Medicaid system, we're taking away IDR, how do you expect these patients to have access to specialty care? And you talked about rising costs, you talked about, you know, the climate that exists, but you're taking specialists out of the pool.

[Amir Bassiri]: I think that's one way to look at it. What we would say is we are encouraging that those specialists do what they did before, which is contract with health plans and be in network providers as opposed to price gouge

[Speaker 49]: the Medicare So you don't want independent physicians? Think that there should be no independent physicians?

[Amir Bassiri]: We do not believe that the Medicaid program should be price gouged by specialists, which is what is occurring with the IDR process. Medicaid is not supposed to pay what commercial insurers reimburse for services. That's federal law. We are the payer of last resort.

[Speaker 49]: So we know IDR exists because the market power is not equal. So weakening it is going to create efficiencies, a lack of efficiencies, and it's also going limit black and brown communities from having access to specialists. They're not going to participate into vulnerable, undersourced communities. Do you have a plan for this?

[Amir Bassiri]: I don't agree with that statement.

[Speaker 49]: So is it appropriate to prohibit physicians from accessing IDR?

[Amir Bassiri]: I don't know that's so what we're saying. We are aligning with the federal IDR process, which does not include Medicaid.

[Speaker 49]: We'll talk about this later.

[Speaker 50]: Thank you.

[Speaker 0]: Thank you, Senator Rivera, for his ten minutes as Chair of Health.

[Speaker 10]: Hello, folks. Okay. Let's start with insurance coverage. There's a couple of questions that have been asked related to whether you have calculated the number of folks who might lose coverage due to changes in the federal in federal requirements. And you provided that there were some of those that you have numbers for, but some that you don't, as far as some of the changes. Do you feel that the current budget actually has mechanisms in it to deal with the fact that there's going to be so many folks who are going to be losing coverage?

[Amir Bassiri]: Thank you for the question, Senator. You know, it's hard to predict if this year's budget has enough. But I will say, as evidenced by the very limited reductions on the scorecard and the large financial plan investment, we are getting a significant influx of general fund resources to manage this problem and potentially the loss of coverage. There's the funding being allocated to providers with the MCO tax for uncompensated care.

[Speaker 10]: Then J. We're to get to the MCO Yeah.

[Amir Bassiri]: Tax. The worry. We'll get Division of Budget did include a discrete investment for Medicaid and New York State of Health for HR1 implementation.

[Speaker 10]: J. Okay. So there's a couple of things related to simplified enrollment certification. Do you just generally believe in the idea of automatic or standardization or simplified enrollment and certification?

[Amir Bassiri]: Yes, absolutely.

[Speaker 10]: Okay. Why did you discontinue zero to six automatic medical enrollment This kids through zero to has

[Amir Bassiri]: been very painful for, I think, everyone at the department. We spearheaded this effort, and I think there's several reasons. One is that we have received explicit confirmation from the federal government that this authority is ending and will be discontinued. They are actually asking us about our unwind plan and how this is going to end. So it's very clear that the federal government is ending this wonderful program that

[Speaker 10]: we you did have not feel that there was something that the state could do with state only dollars to be able to sort of to be able to facilitate this program?

[Amir Bassiri]: No, because I think ultimately what is happening as part of this program is a lot of state and manual processes to ensure that kids are transitioning from the Child Health Plus to the Medicaid program. What is going to happen when this unwinds is that we don't believe everybody who has received coverage will have coverage for an additional twelve months. It's not as though when this ends, their coverage ends. And in reality, a lot will be going to the Child Health Plus program, which is where they came from. When we had projected the like how many kids would benefit from coverage when we instituted this change, it was a relatively modest number because we have such good coverage and coverage policies for children as it exists today. We don't want to unwind it, of course, but we do think, given HR1, given work requirements, given more frequent renewals, we need all our staff dedicated to maintaining coverage.

[Speaker 10]: J. We'll revisit that offline. Let's move to the MCO tax. So I think that we can both agree that there is a difference between something that is proposed and something that is actually delivered. So the fact is that last year and you talked about the timeline, Commissioner. You talked about the timeline that we got it approved. But then it took us a couple of months to actually start getting it in. But the fact is that at this point, we have already collected of what about the $1,400,000,000 that we allocated last budget cycle. Is that correct? Yes. How much of that money has actually moved?

[Amir Bassiri]: Very little.

[Speaker 10]: I'm sorry. Speak more into the microphone, please. Very little?

[Amir Bassiri]: Very little. If not, I would say no new money.

[Speaker 10]: Okay. So, but we're talking about so in the neighborhood because for example, there was a earlier commissioner you referred to the FQHCs having received money. They have not. They had allocated.

[Speaker 1]: But again, as I stated

[Speaker 40]: didn't at the beginning

[Dr. James McDonald]: receive money.

[Speaker 10]: We can say that there's a distinction there. I just want to make sure that's for the record. So we there's a lot of this money that has not been delivered. Keep

[Dr. James McDonald]: in mind, of course it hasn't been delivered.

[Speaker 1]: Okay, good. Good, good, that's what we

[Speaker 10]: said earlier. That's fine.

[Dr. James McDonald]: Why don't No, let me just explain why. You have to accumulate

[Speaker 10]: Let me speak. Yeah, but I got time. So you got We thirty seconds, have go to

[Dr. James McDonald]: get a methodology in order to distribute the money. I'd love your input on the methodology. I'd love your input.

[Speaker 10]: I would hope that that input is accepted, and I would hope that much like did last year hold on. Much like we did last year when we had the conversation, went back and forth, and agreed on what the 1.4 was going be distributed about, how it was going to be distributed, and we wrote it into the budget, we passed the budget, and then none of of that money basically has moved up

[Dr. James McDonald]: methodology approved by the federal government.

[Speaker 10]: Okay. Now we do, so please move it out, and not before the end of the year, but the end of not even the end of the fiscal year. At least the 1.4. The extra that we're gonna get, we're certainly gonna have conversations match,

[Dr. James McDonald]: don't we?

[Speaker 10]: I certainly want the federal match. We already got the the what we've already collected is the issue. That needs to move out. And the stuff that we still have to get from here until the end of the year is is another bit is another chunk of money. I just wanna make sure that the stuff that we've already allocated for hospitals, for nursing homes, for Alps, for FQHCs actually goes out the door. Moving on to the myth. So that one you also said you met with folks last year related to some of the concerns. The the issue that many of us have is that there were issues expressed to you, I'm sure, by parents related to complaint regulations, claims tracking, etcetera. But so you met with them, but I don't think that anything has been done to address these concerns. Would you disagree with that?

[Dr. James McDonald]: You know, as far as I know, the claims are being addressed. I do follow the medical indemnity plan quite closely. Yeah. Claims are being addressed and, you know, decisions are being made. And I think the timeline has actually improved with some of that this year.

[Speaker 10]: Okay, so I would beg to differ, particularly because of the parents who have been telling us that's the case. And I'm not sure if you're going be paying attention by the end of this hearing, but some of these parents are going be with us today. So I would hope that if you're not paying attention, some of your staff is, and that hopefully some of these concerns are actually addressed. And certainly it can't be addressed by increasing investment but cutting the rates at the same time. And I would also argue that the ombudsman is necessary. There's a piece of legislation I have. And as I say in many instances to the executive, steal my my my legislation. Steal it. Steal it. Just make sure if we have a if we have an ombudsman in this case, it would be essential to make sure that these parents' concerns are more are are better addressed. So there's that. Let's talk about CDPAP. We're not going to re litigate the entire thing. We've already had fights before, so I'll just say related to the savings, the one of the things that I wanted to make sure that we talked about is the fact that there is there were there have been enrollment changes, right? And so there's enrollment changes in people. There have been individuals that we can agree, they didn't disappear into the right? You have folks who still needed services, so now they have transitioned to something else. And if they've transitioned to Lixa's, and that is a more expensive service than CDPAP, then maybe the savings that you're claiming might not be so accurate.

[Amir Bassiri]: J. Yeah. I completely understand, Senator, the logic that you have in thinking that as people because you're right, nobody did disappear. Those people are still receiving service. They're receiving in a different modality. And in effect, you're inferring that that modality is more expensive. But remember that we pay health plans to administer managed long term care, which is eighty five percent of CDPAP spend and participants. So, I don't know if you know, but it's not clear that it's always more expensive service. We do have an independent actuary that monitors actual costs.

[Speaker 10]: Okay. And do you have numbers to give us today on the record as far as what the transition has been from one to the other?

[Amir Bassiri]: I think I think we do I have mean, keep something in mind is that in New York State, we offer both CD PASS and licensed home care services to our members. They can go back and forth. Someone can fall, they can get hurt.

[Speaker 10]: Well, no, of them can't. Because they can technically do so, but if there's no people to actually provide the services, and there's been a of issues, we're not again, we're not going to litigate the transition and how there's badly you all managed it. But that's not the point. The point is that if this transition has occurred, if you're to claim savings, and you're to claim it publicly and to us, then number one, need to see it on a piece of paper. Need to see the math. I actually sincerely don't believe you just saying that the savings are there. And more importantly, that if there is a transition between populations that goes to a service that actually is more expensive, then we have to make we have to take that into account to see if the savings actually accrued. And something more important because I'm running out of time. This, I want to make sure that I get you on the record. So on the issue is, do we have any safeguards in the contract related to if PPL is sold? If PPL is sold, is there any safeguards on the contract, particularly as it relates to continuation of services to folks who are because that's the only fiscal intermediary.

[Amir Bassiri]: I want to get back to you on that.

[Assembly Member Phil Palmesano]: Please do.

[Speaker 10]: That's an important and also, do we have anything in the contract or at all, have you been thinking about whether are there measures to ensure the solvency of PPL?

[Amir Bassiri]: Yes, there are measures to ensure the solvency. There's a requirement that they have cash on hand of at least $100,000,000 which they do. J.

[Speaker 10]: Got you. So that issue on the bottom. The issue is whether it's sold. I want to make sure that I see something that you folks can give me. And very quickly at the end, Commissioner, I'm not sure if you remember last year we had a viral moment. Remember the viral moment? When I asked you, you know, I'll tell you.

[Dr. James McDonald]: You're memorable, so I I spoke,

[Speaker 10]: I asked you specifically about school based health centers. I asked you specifically about the fact that we feel that there's many of us in the legislature that feel it should be carved out from managed care. And I asked you whether there was anybody who supported that besides the administration. You looked up and said, I can't recall. I don't know anybody

[Dr. James McDonald]: who I remember supports that.

[Speaker 10]: Right, do you remember that moment? Right. So, I'll ask you again. Yep. Has there anybody who supports the transition of school based health centers to managed care?

[Dr. James McDonald]: If you want school based health centers to thrive, and I do, I don't know how they can be outside of this.

[Speaker 51]: Thank you,

[Dr. James McDonald]: answer is no.

[Speaker 10]: Thank you, Madam Chair.

[Dr. James McDonald]: We can't give

[Assembly Member Gary Pretlow]: them Assemblyman raise to McDonald.

[Assembly Member John T. McDonald III]: Good morning. Challenging times for everybody. Thanks to our friends in Washington. So I appreciate the work. It's not easy by any stretch of the imagination. I think this question is for Department of Health. I know it is. The statewide transformation program funding from prior years, specifically transformation four and five, how much funding has been released to date? And that total dollar amount that remains unallocated or unreleased?

[Dr. James McDonald]: Yeah, so statewide four was $600,000,000 and all of that is allocated. I can't tell exactly how much has been released, but I think almost all of There is no funding for Statewide Five. Statewide Five would have started this fiscal year, but there's no funding for Statewide Five. That doesn't mean there won't be funding next fiscal year, but there's no funding for Statewide Five.

[Assembly Member John T. McDonald III]: So you're saying there's no funding right now? Is that something we're

[Dr. James McDonald]: No, the Statewide awards have been made. Where we're headed, though, is the Safety Net Transformation Program. That's where the state's investing its resources. What we're looking for is sustainable long term health care in New York State. So this year, what we're focusing on is the Safety Net Transformation Fund. That's why there's $1,300,000,000 there, to really help financially distressed hospitals find a way towards long term sustainability.

[Assembly Member John T. McDonald III]: Amir, I think this is going to be towards you. I was at an NCSL meeting in the fall. We met with CMS. And a grave concern recertification of Medicaid, that's fine. We want to have a system of integrity. Where I'm concerned about and I know the department has money allocated to help us get ready for 2027 is particularly in the homeless population, disability population. And at the time, the CMS administrator didn't give us any direction. Has there been any clarification on the process?

[Amir Bassiri]: J. Yeah. Thank you for the question, Assemblym Member McDonald. I do think there's been some clarification. It hasn't been formalized in regulation. But there is acknowledgment and sensitivity towards individuals that have medical fragility and those with disabilities, those that are frequent utilizers of hospital and emergency room admissions. So I think of the two populations you referenced of concern, I think without question they have acknowledged that the disabled population should be exempt from some of these most of these requirements. However, for someone who is suffering from chronic homelessness, I think it could be variable.

[Assembly Member John T. McDonald III]: Thank you. Superintendent, just welcome. We've had some dialogues. And I continue to have dialogues with your staff, particularly in regards to commercial health insurance and prescription benefit managers. As you know, the federal government is leading, not only with the FTC decisions, but also Congress and the President signed some major transparency reforms. And I think it's critical when it comes to looking at what spend is going to be for commercial health insurance in many aspects. We've been, I think, led in the wrong direction for the last twenty years by some of the activities, although PBMs do serve a function. And I think I'm done with my time.

[Speaker 10]: Preciating for the Chair, Madam Chair. Rachel May is next. Senator May.

[Speaker 50]: Thank you. Commissioner, I have a few questions for you. You know that I represent four of the Finger Lakes a lot of water bodies in Central New York. And water quality, especially drinking water quality, is top of mind for all of my constituents. But I consistently hear that DOH is very slow in responding to watershed plans, to a lot of the issues that they are concerned with. So I'm wondering what in this budget is intended to beef up staffing, to, you know, reduce the time it takes for

[Speaker 6]: you all to respond

[Speaker 50]: to some of these issues.

[Dr. James McDonald]: Yeah, so there is funding in here for me to have some flexibility to scale up an environmental health that's in the area I'm most concerned about. We did cybersecurity wastewater regs are going be propagated this year. I was able to hire staff for that. That's very helpful to all of us because cybersecurity on wastewater and water, quite frankly, is really critical everywhere in New York State. But I think one of the things you have to look at too is there's a lot of money for infrastructure in water this year and next four years after that. $750,000,000 a year will make a nice difference there. So I'm optimistic we'll see that, though. But if there's a specific issue you're seeing with someone in your district or your area, please reach out to one of the assistant commissioners, and we'll help out.

[Speaker 50]: Thank you. Then I wanted to follow-up on Senator Webb's question about black maternal mortality. DOH did a study in 2024 that showed it was five times as high as white maternal mortality. Is there anything in this budget that is designed to change those statistics?

[Dr. James McDonald]: So we have 19 different initiatives that are public health initiatives that we are doing right now from previous budgets. The amount of money in that, you know, it's broken up between Medicaid and with the Office of Public Health. The Office of Public Health has $42,000,000 they carry forward every year that is sustainable. Medicaid right now has a $50,000,000 incentive for this fiscal year to decrease C section rates. Of the 19 initiatives, 10 are targeted towards decreasing C sections. Five of those are in Medicaid, five of those in the Office of Public Health. So really one of the things we did see is with Medicaid, we did see some progress with that financial incentive, so that's one of the big ones we're investing in. We do have the birth equity project we do.

[Speaker 50]: Let me ask one other question. Sure. It's about the transition with CDPAP. We heard about just appalling health insurance availability for the workers doing the home care work in CDPAP. Has that been addressed? Do they have adequate health insurance now?

[Dr. James McDonald]: Yeah, so PPL has addressed this. So now they have a silver plan and I know they're going be making some decisions about how they can even improve it further in this year. But I don't want to get ahead of them. They might be here later on today to talk about that. But you're right, they did have a hard start with that, but they did make an improvement mid year. Part of the reason they had such a hard time in the beginning with that is legacy fiscal intermediaries did not give rating information about the workers. So when they went out to bid, they had no context. So they got the bid they got.

[Speaker 50]: J. Okay. Thank you.

[Assembly Member Gary Pretlow]: Thank you. Assemblywoman Simon.

[Speaker 17]: Thank you, Mr. Chair. So Commissioner, I have you know, I'm chair of the Mental Health Committee. And I am very concerned about the Medicare managed care as it relates to behavioral health services and vulnerable New Yorkers. Right now there is Medicare managed care carve in for behavioral health services. But we could literally save the state $400,000,000 a year if we cut out the managed care plans as the middlemen. They're not coordinating care. They're for profit organizations that are just making money off the taxpayer. And they have been over 300 I think it's three twenty citations by the department against the MCOs, by the state. And denials of care for these services get overturned at a much greater rate than others. And so the mental health providers are spending all their time filling out paperwork. And there are safeguards in place for any issues if going back to fee for service. I would like to work with you on this. And I would like to have your commitment that you will work with me on this issue.

[Amir Bassiri]: Definitely happy to work with you on any issue that improves access to care for those that are seriously and emotionally in need of service.

[Speaker 17]: Yeah, we have a big issue with children not getting the mental health care that they need. There was a class action that was filed. And there is now a settlement that will take a period of time to completely rework that. And part of that is also increasing reimbursement rates. But this issue of Medicaid managed care also impacts that population dramatically. Yeah. And they're not getting served. These kids are waiting forever before they get service or not getting it at all. And it has to change.

[Amir Bassiri]: So what I would say is we work very closely with the Office of Mental Health and Commissioner Sullivan on that exact case you're referring to. And these are all Medicaid programs. So they all impact the Medicaid recipients. But we have that eighteen month settlement. We're working very closely. We are working together to improve the HARP program, which is our behavioral health program. What I would say is that I do think there are a lot of benefits that we've seen with the coordination. While there have been some concerns, we've seen progress. And we've heard about progress from OMH with respect to what plans are doing in the community.

[Speaker 17]: I would love to know what you consider progress because from the perspective of kids getting the help they need, people getting the service they need, it hasn't looked like progress. And it it's, was one of those things that looked like it was good on paper but isn't actually been implemented in a way that has met the goal. So I'd love to have a meeting with you and figure out what you mean by progress, because it doesn't look that way from this end. Thank

[Senator Patrick Gallivan]: you. J.

[Speaker 10]: Thank you. Senator O'Mara.

[Senator Tom O’Mara]: J. Thank you. Good afternoon. Thanks for your testimony today. Commissioner, to you, an issue that I've been pushing for years, I think the governor is included in perhaps the higher ed portion of the interstate compact on medical licenses, nursing in particular. What's the difficulty we've been having in moving forward with this, and wouldn't that help? You know, I have a district along the border of Pennsylvania that I think would benefit greatly from this entering into the interstate compact. I think we're the only state in the country that's not in it.

[Dr. James McDonald]: It's getting close to where the only state. You know, I think the thing about the interstate nurse license or compact, just to keep in mind, it's like a driver's license. I mean, could you imagine if had to get a different driver's license to drive from here to Florida? I don't really know that there is an impairment on our side of that issue. I think there's a lot of reasons why it would be a very thoughtful and deliberate approach. I mean, we haven't been the obstacle to that issue, Senator. I share your concern. If there's a nursing shortage in New York State, I think it would help.

[Senator Tom O’Mara]: J. Absolutely. Thank you. Relative to the CDPAP and the appointment of PPL as the single fiscal intermediary. It was my understanding that they were supposed to utilize independent living centers to assist them in this process. And I'm hearing from independent living centers that they're not getting referrals and they're not being utilized. Can you comment on that?

[Amir Bassiri]: Yeah, happy to. Thank you for the question, Senator. Happy to look into that. But the last account I had is that every independent living center that was part and being part of the PPL facilitators has seen more than 50% increase from the pre PPL state. So I find that incredibly hard to believe. They all have more work than they had to do before, meaning they're getting paid to take care of more people.

[Senator Tom O’Mara]: J. Okay. Well, I just had a meeting yesterday with one, and they're seeing the opposite.

[Dr. James McDonald]: I would love to talk

[Amir Bassiri]: to them and talk to

[Senator Tom O’Mara]: you with them and talk about that. Commissioner, in 2022 there was an approved stewardship program for drug take back program that the department was supposed to report on annually. And has there been a report? When are we going to see a report? I think it was supposed to be done in 'twenty four or 'twenty five.

[Dr. James McDonald]: I'll have to see if there's been a report. I have to tell you, we have 100 reports we do. I don't remember this one in particular but I know we have the drug take back program and we monitor it. But let me just have Associate Commissioner DeRoce get back to you, and if there isn't a report, I'll find out why. But I think it was done.

[Senator Tom O’Mara]: Okay. Thank you. Again, Commissioner, in the Governor's proposed budget there's an increase to the NYSHIP prescription drug cost of 5.5%. Can you tell us where that money is going to be directed to? Is it going to independent pharmacies who are on the brink?

[Amir Bassiri]: So the department doesn't oversee or administer the NYSHIP program. The Department of Civil Service does. So I can't really speak to that. But happy to get back to you.

[Senator Tom O’Mara]: Okay. I would like to look into that further and see if there's an increase, what it's going for. Lastly, I think relative to Lyme disease in this state, I don't believe we're doing enough in that regard. What, if anything, is there in this budget proposal to advance the research and treatment of Lyme disease? And what more do you think we should be doing?

[Dr. James McDonald]: Yeah, so when you look at Lyme disease, the way the Department of Health is on this is we're mostly in helping get disease cases reported to us, and that's really our role, is to report numbers on this. You know, we have owned media on this, we do some social media on this. We don't really fund research into Lyme disease. That's really not something the Department of Health normally does. Research is normally driven by federal or national or other entities. So I really think our lane is mostly in the public health approach. And then of course the education approach, right, which is Lyme disease is preventable if people wear intraocular pallidum, but as you're seeing there's more and more ticks being out there, which is really a product of a longer season, part of that's because the climate indeed did change. So these type of things are on the increase, not just in New York but in other states.

[Senator Tom O’Mara]: Do you think there's adequate federal funding going towards research for this issue? And if there's not, why wouldn't we step up and do it since we're such a hotbed of Lyme disease?

[Dr. James McDonald]: So I have a lot of concerns about where the federal government's research, period. And just because the federal government isn't going there doesn't mean the state has to step in there for something like this. It's an important issue, but we have a lot of important issues in New York State, you so have to be judicious about it. But if this is something that you'd like to collaborate with, my team's open to hearing what your ideas are and seeing what's possible.

[Senator Tom O’Mara]: Great. Thank you very much.

[Assembly Member Gary Pretlow]: Thank you. Assemblywoman Lucas.

[Assembly Member Nikki Lucas]: Okay. Good afternoon to everyone in the room. I just want to note a couple of things. One, there's seventy percent of a female population in my district, so a $5,000,000 cut to maternal health care will be detrimental to my community. Two, I have a daughter that was diagnosed with diabetes, type one, which doesn't seem to get the same level of attention. But looking at preventive care and detection early for that population is important. And also investing in support group for parents for education is also important as well. I also just want to ask a quick question, a few questions about, one, the streamlining and digitizing your records. What provisions have you made for seniors who may not have access or not as tech savvy? And additionally, in well, let me let you answer that first.

[Dr. James McDonald]: Yeah. So when it comes to digitization of records, and and thank you for that, what we'll be doing is we're digitizing our records, and then we're improving staff and vital records. One of the biggest problems that have on vital records right now is we've done a lot of business improvements. We use artificial intelligence for document ingestion. We've optimized workflows as best we can. What we're really trying to do is get the point where seniors and everyone else in New York can get a vital record in a reasonable period of time.

[Assembly Member Nikki Lucas]: Okay. I want to cut you off because I just want you to in writing in terms of how that will be done.

[Dr. James McDonald]: J. Sure.

[Assembly Member Nikki Lucas]: JENNIFER J. Then I just want to get to this. Your own record said there were 280,000 consumers and 400,000 PAs in January 2025. Can you tell us how many consumers are enrolled with PPL now and how many PAs are now employed with PPL?

[Amir Bassiri]: Yes. Thank you for the question, semiwoman. It's about, it fluctuates, but it's over 200,000, I think it's 220,000 who are registered and authorized to receive care in the CDPAP program. That's from the two eighty. And then it's about two eighty in terms of the workers that have been unique workers that have been paid. Now that fluctuates per week, but the number of individuals who have been paid

[Speaker 7]: Let me

[Assembly Member Nikki Lucas]: get to the next one. Can you explain the massive loss in enrollment? It can't be that people were illegally enrolled or committing fraud since most have moved over to traditional agency care. So please tell us what happened and what is DOH doing to fix measures that have caused this exodus of consumers and PAs?

[Amir Bassiri]: J. So I don't think there's been an exodus of consumers and PAs.

[Speaker 7]: J. Can you

[Assembly Member Nikki Lucas]: send us anything in writing to confirm those numbers?

[Amir Bassiri]: J. Yes, absolutely. J. J. I do want to clarify. Think you're referring to the rate of growth into the program, into the managed long term care program, which has slowed.

[Assembly Member Nikki Lucas]: J. Well, a combination of both, growth as well as the exodus. J. If you can send that to us

[Amir Bassiri]: in writing. Just want to be clear. There's no exodus. J.

[Assembly Member Nikki Lucas]: Send it to us in writing. Thank you.

[Speaker 10]: JULIE I'll take a second round. Folks. Two things I didn't get to earlier. First, early intervention. There was back in the 'twenty four and 'twenty five budget, there was we included a 5% rate increase. And I believe that this is still pending CMS approval. Is that correct? Yes. Okay. And because of that, we've not we can't get the federal

[Dr. James McDonald]: share That's right. We ping CMS all the time, and it's the hold up Gotcha.

[Speaker 10]: No, no, I got you. But that's approximately 6,500,000.0 on an annual basis. So obviously

[Dr. James McDonald]: But we'll be paying retroactively, though.

[Speaker 10]: Great. But the question is, there was also the state plan amendment contained the rate increase, but it also contained a reduction of reimbursement for telehealth services. And it is my understanding that the telehealth services, that is already in so could you shed a little light on the decision making here and why at the same time that we're not getting the federal money still? Not yet? Yeah, so But did cut the telehealth reimbursement rate.

[Dr. James McDonald]: Right. So keep in mind, there was a 4% rural increase that did happen, which was odd that it happened the way it did because we submitted that state plan amendment after the 5% increase. The state plan amendment for the 5% increase is being held up by the Center for Medicaid and Medicare Services. We don't know of any problem with it. What we were told recently was they were overwhelmed by the shutdown. So we're hearing good things now. As far as the cut goes, which is what you asked originally Yes.

[Speaker 10]: And why would you go ahead with that? Because the State Plan Amendment has both of those. But one you could implement by yourselves, which is the cut. And you have to wait for the federal approval to get the extra money.

[Dr. James McDonald]: J. Because you didn't want to have a situation where people owed the state a lot of money. That's why it was stunned.

[Speaker 10]: All right. I might have to remit to that. One more thing. So managed care organizations, subcontracts, subcontracts is the aspect of its core Medicaid duties to another entity. That spending is considered medical spending under the medical loss ratio. So it's so I believe that when a managed care organization subcontracts aspects of its core Medicaid duties to another entity, all of that spending is considered medical spending under the medical loss ratio. Is that correct?

[Amir Bassiri]: Not exactly.

[Speaker 10]: Not exactly?

[Amir Bassiri]: I think it depends whether it's a management services agreement or an administrative services agreement.

[Speaker 10]: A little bit more into the microphone, please.

[Amir Bassiri]: I think it depends on whether it's a management services agreement or administrative services agreement. I mean, I think in most cases you are correct, but I don't want to state that uniformly.

[Speaker 10]: Because there is a and we certainly should follow-up about this later, because there is a concern that some of these folks may be actually receiving some of this and using it not for medical purposes, but for administrative costs and profit. So there's a concern that we have there.

[Amir Bassiri]: I think that's something we're very concerned with as well in terms of related party transactions, and something we're looking at very closely as part of our managed care accountability effort. But I agree. I just don't want to state uniformly that it J.

[Speaker 10]: We'll follow-up offline on both issues.

[Senator Jamaal Bailey]: Thank you.

[Speaker 10]: Assembly.

[Assembly Member Gary Pretlow]: J. That's it. Okay, Will. Commissioner, commissioners, I have one question, and it's similar to my question last year.

[Speaker 16]: I'm going. I

[Assembly Member Gary Pretlow]: want to go. Similar to my question last year, had to do with durable medical equipment, durable medical devices, AKA wheelchairs, prosthetics. It's my understanding that the reimbursement rate that companies that produce these items is like a percentage of nineteen eighty four's Medicaid rate. Since 1984, inflation has gone up 212%. Assemblyman, McDonald, passed a bill. The legislature passed a bill which required the state to increase the reimbursement rate. And the governor vetoed that legislation. I don't know whether that was at the request of the Department of Financial Services, the request of the Department of Health, or request of Medicaid. But it had to have been at the request of someone. And the excuse was it was too expensive. You can have the rest of my eight minutes and forty seven seconds to please explain to me why this government saw fit to actually drive numerous companies out of business because no one can continue to produce these devices at the rate that they're being reimbursed at through the State of New York. You have the floor.

[Amir Bassiri]: Thank you for the question, Assembly Member. I just want to confirm the bill. I think I recall what bill you're talking about, and I think you can blame that one on me. The reason is that, you know, we have our fee for service program, which I think, as you said, is based on a very long time ago. I just want to clarify that is not what the managed care companies base their reimbursement on. But we do have a process whereby if a provider, DME provider, feels the reimbursement we provided was inadequate, and they have an invoice they can give us for what they paid for it, we will consider changing that reimbursement and updating that reimbursement amount. So there is a process to the extent there's underpayment or inadequate payment in fee for service. What the bill had done was, in effect, require, if I recall correctly, require that managed care organizations model the fee for service reimbursement. And in some cases, it was very expensive. And there's no management and oversight of the utilization of those services. DME is a very significant area historically of fraud, waste, and abuse, one that we're actively monitoring. A lot of these providers are not in the state, or they can be one of these related companies that was referred to earlier. But I can tell you we care deeply about access to wheelchair repairs and other durable medical equipment, and we'd be happy to work with you to ensure we're providing widespread access for our Medicaid population.

[Assembly Member Gary Pretlow]: Now, that being the case, why are so many companies going out of business saying that they can't afford to produce these products?

[Amir Bassiri]: I am not 100% sure. I have not heard from them. In the past, when we heard from New York State specific durable medical providers, there had been entities in managed care that operate like a pharmacy benefit manager, but for DME. And they were cutting the reimbursement on behalf of health plans and others to those DME providers. That was the allegation. I don't know that we've seen that bear out as it was stated, but there's sort of a middleman in between the state and the DME provider that is playing a role in this.

[Assembly Member Gary Pretlow]: Okay. Well, I've been in contact with a few of these companies, and I think that we can revisit this. Absolutely. I'm pretty sure that one of them or some of them are monitoring this conversation now. And if there is any inaccuracies in what you had just said, they will tell me. All righty, I believe that answers my question. Is there another senator? There's some woman giglio. No?

[Assembly Member Jodi Giglio]: Okay. Thank you, chair, and thank you for all being here today. So the budget for the fiscal year of twenty twenty five-twenty twenty six was adopted in April. However, the rates for nonprofit providers for OPWDD, those rates were not loaded until the August. And the providers didn't actually see the money until the February. Why is there such a delay in getting the providers paid? We adopt the budget. We fight the increase. The rates are not loaded. And then they're waiting to get paid. They're borrowing against their reserves. And while the DOH has the money in the accounts, collecting the interest, it's costing the provider's interest already on a low budget.

[Amir Bassiri]: Thank you for the question. I'm not 100% sure which payment rate you're referring to. We do a lot of For reimbursement and for group homes and OVWDD. I will just say when the budget is passed, if there's a change to a methodology, it does require us to go back, look at the regulations, update the rates. There is a process. It's not just as turnkey as you're making it sound. But regardless, we maintain the effective date of that change when we issue a federal public notice. So in effect, the payments when they are made are retroactive to the date of effect.

[Assembly Member Jodi Giglio]: Understood. Understood. And thank you for that. But they're still waiting seven months to get paid with the increased rate.

[Amir Bassiri]: Well, I can tell you we work pretty quickly over here at DOH with rate settings, so happy to look into that. But we're working very diligently and especially in that area.

[Assembly Member Jodi Giglio]: So the money needs to get out the door. That's all I'm saying. And the prompt pay laws in the state of New York, which require thirty days payment from a provider submits a claim if it's electronic and forty five days if it's in writing, or if they send it in writing. Why are they waiting six months and then getting denied or, you know, not getting paid at all? It's really, they're having a hard time keeping the lights on. And I just don't know what the delay is in we have a law. Who's enforcing the law of thirty days for electronic and forty five days for written?

[Caitlin J. Azar]: Yeah. Thank you for that question. So we are we are following up with the carriers. We investigate those. We have a number on our docket and we're happy to follow-up with you if you have a specific question on on a specific carrier.

[Assembly Member Jodi Giglio]: Yeah. I mean, it's I understand if there is an investigation that's necessary, but, the law says they have to be paid within thirty days or forty five days. So why are you not investigating after they're paid? And if there's a clawback, then claw it back. But they need to get paid so they can keep the lights on and keep providing health care.

[Caitlin J. Azar]: Yeah. Thank you for that. We are following up with the carriers as soon as, you know, that prompt payment is not made, and we will continue to do so.

[Assembly Member Jodi Giglio]: Okay. And then real quickly, back to what Assembly Member Souffrant was saying about the IDR. I mean, it's really pushing private practitioners. I'm sorry, we'll

[Assembly Member Gary Pretlow]: Thank you, Assemblywoman. I'm so sorry, Assemblywoman Amy Paulin, Chair of Health, to close.

[Assembly Member Amy Paulin]: Thank you so much. First, a couple of comments reflective of what you've said and what my colleagues have asked. On the myth, I am completely aligned with Senator Krueger. I don't understand what is going to happen to the families that rely on private duty nursing at the super enhanced rate, particularly in my area. And I agree Manhattan is a likely other problem, as well as Nassau, Suffolk, and the other suburbs. I would love to know, following up on that now I realize you might not have it today, but what exactly we pay those areas, you know, or statewide so that we can see where the real problems are and where honestly where the children are going to potentially get served. On the essential plan, aligned with you, I have a deep concern with those who are no longer going to be insured. And it would be great to see a robust plan in the thirty day amendments in terms of how we're going to deal with the either 1.2 or at best scenario, the 477,000 that are going to be uninsured no matter what. On EI, well, let me step back. Now some questions. Aligned with my colleague who just spoke about money out the door. You know, there's a lot of problems with money out the door in a lot of areas. You know, the FQHCs, for example, it's just being rolled over. So there's no increase this year. And there, you know, which I would love to see that problem resolved again with the nine month extension of the MCO. The EI, I get it. We are waiting for the reimbursement. But I want to point to two other categories. One is the $25,000,000 for medication abortion and care later in pregnancy enacted in last year's budget. That's also money not out the door. Is there a rationale? And there's a special problem with the maternal health grants because they are legislative ads. What's been happening there is that by the time the contract, which has to be re upped every year, is done, the period of time that they can spend the money is very narrow. And as a result, if the hospital has money, you know, because we really pick those hospitals based on their high C section rates, not on their wealth or lack thereof, they have been doing the program. But in a place like Oshi, which is in Buffalo, which is primarily Medicaid, they have not been doing the program and then they only have a two month window to spend all that money and they can't. So if we are going to be addressing maternal health across the board, we really need to deal with the specific grant re ups that happen. So I wondered, you know, if you have anything you can

[Dr. James McDonald]: share Yeah, in so the the $7,000,000 for the nine hospitals, you know, you're right. You know, it just went out January 26, you're right. You know, we get this, you know, it takes a couple months to come from the legislature to us, then we actually spend just a couple weeks on it and then we move it around. We've made systemic changes recently so when it leaves us, it'll move through quicker because legislative ads are pretty directive. So there shouldn't have been as much hands in the pot as it were because I agree with you. Hopefully that money can be rolled over for next year.

[Assembly Member Amy Paulin]: J. Thank you. Continuing on the issue of maternal health. Two, I guess two years ago, the governor in her state of the state came out and she said we're going to have a six point plan, you know, to address the high C section rate. Acknowledging that, you know, that leads to hemorrhage vis a vis the report that was issued. And hemorrhages, you know, caused a lot of the maternal mortality rates to rise. If what is the six point plan? Like I know what we did. You know, the legislative grants are the 10 hospitals that you're talking about. Has there been anything else that the department has done toward the goal So of reducing C sections?

[Speaker 0]: Or did you think we just had such a good idea that you're waiting and seeing if this idea is the idea?

[Dr. James McDonald]: Your idea is a good idea, but it's one idea of many ideas. We have 19 initiatives we're doing right now to reduce maternal mortality and pregnancy related deaths. Just to put a fine point on that, maternal mortality and pregnancy related deaths are different. World Health Organization, maternal mortality is death forty two days, while you're pregnant or forty two days after. Pregnancy related death, which is used in The United States, is death during pregnancy and up to twelve months thereafter. So just a fine point. So of the 19 initiatives, 10 are targeted towards reducing C sections, five in Medicaid, four expand coverage, One is the financial incentive I talked about. The five in public health are focusing on quality and clinical care in particular. There's a comprehensive approach towards optimizing clinical care so C sections are done only when necessary and getting the best outcomes. You're right, hemorrhage is a leading cause to some degree, but mental health and substance use is really a little bit ahead of that as well. Keep in mind, too, one of other things we're doing is the Department of Health is also a regulator. If there's a maternal death that occurs in the hospital, I find out about it. And then there's a regulatory approach that looks at that issue. If there's a death in the hospital, someone having a baby, they have to do a root cause analysis, and that comes back to the department. So it's a pretty comprehensive I

[Assembly Member Amy Paulin]: would love a separate briefing on the plan or what's really been going on.

[Dr. James McDonald]: We'd love to. J. Did that last year, it was great. We'd love to.

[Assembly Member Amy Paulin]: J. J. Good. Moving on. The applied behavioral analysis, can you explain better what that proposal really is all about?

[Amir Bassiri]: J. Yes, absolutely. So last year we had made a proposal that we ended up negotiating on reducing the reimbursement rate for unlicensed techs. We only reduced that by 25%, but I think this proposal gets back to what the executive proposed last year in getting that rate further reduced. And then there's a statutory component to establish a center of excellence model. And what this really is, is based on some work we've seen around the country, in particular Washington State, to establish or designate certain providers as

[Assembly Member Amy Paulin]: centers I'm familiar with the program. Thank I was wondering if it was Washington State.

[Amir Bassiri]: It was and that's who we've been talking to. You know, ABA is a very large national issue for all Medicaid programs. They're all seeing and experiencing the unsustainable rate of growth and utilization that we are.

[Assembly Member Amy Paulin]: Thank you so much. Sorry, we're just trying to move on to get to some other things. The nursing home acuity adjustments, it's causing nursing homes not to get as much money as they could. And it's also causing delays in hospital beds not being able to transition and potentially for nursing homes not to even want to take those patients. So where is that?

[Amir Bassiri]: Well, there was a question earlier today. We had been going through that process. It should have been stood up by now. But the data that the nursing homes provided us, the assessment data, was not good enough, useful enough for our independent accountant and actuary to work on updating those rates. We do have it now. It should be by the summer.

[Speaker 7]: Great.

[Assembly Member Amy Paulin]: One more. Otherwise, I'm going take my three minutes following this perhaps. Given the need for twenty fourseven residential care in so many communities around the state, especially for low income older adults, What can we anticipate, or when can we anticipate the new assisted living program need methodology, which was due in April?

[Dr. James McDonald]: I'll have to get back to you on that. I don't know the exact time frame. Just get back to you this afternoon on it.

[Assembly Member Amy Paulin]: No worries. EMS. Know, since I've been health chair, I've seen the department every year put in some modifications and changes to advance that program. And recently I had great meetings. Thank you for facilitating them with the specific staff that does EMS. Okay. One of the things I was struck by in that meeting, and I just wondered if you concur, is that the data that the state receives doesn't include from the call to the actual time the ambulance gets there. Because the data is erratic and it's different in every county and it's different in every community and it's different if it's commercial or a not for profit. You know, is there something that we can do together that would allow those of us in New York to know if the response time to our house is going to be at the top of the list or the bottom?

[Dr. James McDonald]: Yeah. I I agree with you, by the way. Having recently stopped at an accident, I was surprised how long it took but, thankfully, hot solar came. But here's the issue. The answer is yes. There's something we can do together. Nine one one dispatch centers are controlled by Department of Homeland Security Emergency Services. But what's interesting about this is once a call to dispatch goes, if somebody can't make it, there's a gap, and we don't know that gap. And then you have another person, and we don't know they didn't respond. Then the third person might be the one who responds. And only data I get is the person who actually responded. So that would falsely So there's a gap.

[Assembly Member Amy Paulin]: A 100%. There's This got to be something

[Speaker 55]: is one of those things

[Dr. James McDonald]: where we should be able to solve this.

[Assembly Member Amy Paulin]: Yes. I would love to work with you to figure out, you know, what we need.

[Dr. James McDonald]: We would love to.

[Assembly Member Amy Paulin]: J.: You know, if it's the commercial providers that we have to mandate, you know, or counties to facilitate, I don't know. But I would love your help. And, oh good, I get another one or two. On covered lives, just to go back to EI for a minute. Ditto what everybody said. But also there was one other issue. And that I understand that the state is keeping $5,000,000 off the top of what was supposed to, we thought, be a fiftyfifty split with the counties. Your comments.

[Dr. James McDonald]: I think you're right. That's there. If there's a legislative solution you can find at that, I would love it.

[Assembly Member Amy Paulin]: Okay. Oh, one more. Master Plan on Aging. Is there anything new in the budget on that? I mean it was a whole plan, a lot of words, a lot of pages. Know, Appendix G had so many suggestions. Is there anything that we're doing in this budget plan or that the department's doing that we should or can learn about today?

[Dr. James McDonald]: So we have a $19,000,000 direct caregiver flexibility grant that we're doing, which actually helps us get more home care workers. So that's one tangible thing we're doing. State Office of Aging got some money to actually reduce some of their wait lists. And Department of Homeland Security and Emergency Services got some money to actually make things a little bit easier for people who are elderly. The Master Plan for Aging, though, was meant to be a menu for everybody to look at options of things. I'm hoping you guys have ideas of things you want to fund.

[Assembly Member Amy Paulin]: J. Was one legislative idea I'm going to pick up. Thank you so much.

[Speaker 0]: J. Thank you. J. Hi. I'm back for my last three minutes. Back to Miff. So at one time last year, I don't know whether it was the governor's office or your office, but somebody proposed that we would just shut down accepting new families into MIF. And that was considered, But I don't think anybody thought it was a great idea. I believe the hospitals were concerned that they would actually have to pay through torts, again, which would increase medical malpractice insurance. And they were concerned about that, even though they seemed to not believe they were obligated to pay for the costs of MIF. So here we are again, another year, more noise like this. Are you proposing that again for this year?

[Dr. James McDonald]: So there isn't any other proposals for the Medical Indemnity Fund other than the one that we put forward. We did meet last year. It was our people, met with many people in the legislature. We came across a lot of ideas. But my approach last year was, let's tell you all about the Medical Indemnity Fund, and then you come up with ideas that we can help work on, right? But there is no other proposal other than what we proposed. Now if something comes forward from the legislature that we can collaborate on, we'd be very interested in seeing if we can make that work.

[Speaker 0]: Okay. So I don't think there's something coming forward from the legislature, although I'm one who would actually think ending MIF would be okay as long as we go back to a system that's better addressing the concerns of the children and their families. So I actually asked the courts what this would mean. And they said, well, if you end it, then obviously you go right back to the tort system. But if you even reduce it, we feel that those children also have the right then to go back to court and have relitigation. Because their needs at age 13 or 15 could be very different than when they were one years old and there was litigation. And if the state's not meeting its legal and ethical obligations through a MIF, then we have to bring it back to court and get different monies awarded to them. So I'm just curious whether the state has thought about the impact of that reality because that's what the court's led me to believe would have to be the storyline.

[Dr. James McDonald]: Yeah. And so I I can't I'm not just gonna accept that at face value that that's the plan going forward. The proposal we put forward is what we have. It's projected to be a $50,000,000 savings. I see a couple ways of approaching this. We have $75,000,000 committed to the medical indemnity fund this year on top of the 52,000,000 order to maintain solvency. We're open to different ideas, but what we're trying to do is find a way to maintain solvency in the future for the fund.

[Amir Bassiri]: And I would just add to what the commissioner said to state unequivocally without a change to the reimbursement, it will not be solvent ever.

[Speaker 0]: J. It's your understanding that the original payments for MIF were through a tax on the hospital system, correct?

[Amir Bassiri]: J. I am aware of that, yes.

[Speaker 7]: J. Yes.

[Speaker 0]: J. If the costs for MIF have gone up over time for obvious reasons, both the number of children going in every year

[Assembly Member Gary Pretlow]: I'll stop at one second.

[Speaker 0]: The number of children not coming out every year, and the increased costs, by definition, there should be increased payments through the hospital system.

[Amir Bassiri]: In theory, there should. I think HR1 impacts that. Happy to talk about that offline.

[Speaker 0]: Okay, thank you.

[Assembly Member Gary Pretlow]: That was the longest one second I

[Speaker 56]: have seen.

[Assembly Member Gary Pretlow]: It must be your timekeeper

[Dr. James McDonald]: saying that. Absolutely.

[Speaker 0]: Wait. I believe we were very generous in giving your health care several extended three minutes.

[Assembly Member Gary Pretlow]: J. Absolutely. We've been joined by Assembly members Kelles and Reyes. And the next questioner is Assemblywoman Reyes.

[Speaker 0]: Not working. Mhmm. Oh, it's working.

[Assembly Member Karines Reyes]: Good afternoon. My question is actually on the zero to three's evidence based healthy steps program. Are you familiar with it?

[Dr. James McDonald]: Keep going, and I'll see if it rings a bell.

[Assembly Member Karines Reyes]: Alright. So I'll give you a little a little background. It's it provides it's usually embedded into primary pediatric care. It provides services to a 133 pediatric primary care settings. It in a 133 pediatric primary care settings in New York, reaching about a 170,000 children and families. It's a kind of a supportive wraparound program that happens within the primary care setting largely due to multiyear state investments from OMH. Medicaid funding is needed to sustain the model to ensure babies, young children, and their families have access to supports and services they need for years to come. My question is, what is your plan to support pediatric primary care in rural, urban, and suburban settings in New York State, given the changing Medicaid priorities of the federal on the federal level?

[Amir Bassiri]: Yeah, I would say You

[Assembly Member Karines Reyes]: seem to be familiar with

[Amir Bassiri]: large interest of ours and focus of ours is specifically on pediatric primary care generally. It's not necessarily it's been underrepresented, underfunded. There's no distinct reimbursement for it and identification of those clinics. And so we are addressing that through a comprehensive maternal health strategy. The Commissioner mentioned some of it. We are doing things on the Medicaid side with incentive payments, quality improvement measurement. But we are still looking at like a medical home like model and seeing what else can be done to support pediatric practices.

[Dr. James McDonald]: Okay. Can I just add that we have Rural Health Transformation Program funding that's going to try to help rural practices in primary care get patients out of medical home, which will improve their reimbursement in addition to that?

[Assembly Member Karines Reyes]: I mean, I'm particularly advocating for this program. I'm carrying a budget letter for it, but the program has shown an average Medicaid return on investment of a 163%, meaning that for every $1 invested, states have the state saves about $2 and $60.63 cents in Medicaid costs. It has been proven to be highly effective. I just want to make sure that it's top of mind in your strategy to support families and the primary and the pediatric population.

[Amir Bassiri]: A 100% those numbers don't ring a bell, but I know how effective the program is. And we usually support what OMH brings to us to be funded through Medicaid.

[Helen Schaub]: Thank you.

[Assembly Member Gary Pretlow]: Assemblywoman Kelles.

[Speaker 7]: J. So

[Speaker 59]: I heard when I was listening to the conversation that there was no exodus from PPL and the CDPAP program. And I'm just curious how you came up with this because I'm hearing very different numbers of how many people have not been able to transition. And specifically, also interested if you are tracking how many people have concurrently shifted over to institutional settings, because that would give us a sense of how many people were unable to navigate that system.

[Amir Bassiri]: J. Yeah, I mean, think this is a pretty loaded question, to be honest.

[Assembly Member Jodi Giglio]: J. That's my

[Amir Bassiri]: job. There's no exodus because those people are still Medicaid eligible and are still in the Medicaid program. So if they've lost eligibility, I encourage you to have them call me.

[Speaker 7]: Okay.

[Speaker 59]: Shifting gears, we'll have a further conversation. How is the state preparing to meet the basic needs of nutrition food for particularly rural communities, given the federal cuts that we're seeing?

[Dr. James McDonald]: Yeah, so there's a very large investment in the Hunger Prevention Nutrition Assistance Program this year. It's up to $72,500,000 so it's a very substantial increase. Nourish New York got a $5,000,000 investment, up to $55,000,000. We did see some increase on the federal side with WIC funds, so that helps as well. Mean, one of things you saw well

[Speaker 59]: Small group.

[Dr. James McDonald]: Anything from this federal government that's increased, I'm just gonna celebrate it because they've been harsh. Right?

[Speaker 50]: Sure.

[Dr. James McDonald]: But I think it's one of those things where really what you see is really an investment in food banks, and the 2,700 contractors they have through that. So, you know, the governor stepped in last year when we had to when SNAP got cut and offered $65,000,000. Hopefully, that doesn't have to happen again. But there's also $10,000,000 in capital funding for regional food banks. It's it's in the plates program, which is kind of an interesting acronym, but it's capital funding for food Are

[Speaker 59]: we expanding the groups that we are gonna be working with, nonprofits, for profits, private entities?

[Dr. James McDonald]: Is that in the plan? Yeah. So we contract with 10 regional food banks. Yep. Having said that, they're the ones who contract after that. I know they have, like, I think 2,700 subcontractors at this point. There's a lot of people who they work with.

[Speaker 59]: So then one other question and a little bit of time. How will the $1,500,000,000 for hospitals and nursing homes be allocated between the two sectors and among facilities within each sector for long term care?

[Dr. James McDonald]: Yeah, so we didn't come to this year's budget with a methodology for that. What we wanted to do was collaborate with the legislature because we understand you have constituents and want to meet the needs. Because, obviously, hospitals have needs, federally qualified health centers have needs, nursing homes have needs. A lot of health care has needs, so we want to see what's best. But this is part of just the collaborative approach we're trying to have this year.

[Speaker 7]: Thank you.

[Amir Bassiri]: You're welcome.

[Speaker 0]: You thought it would never happen, but we have completed our list. So we want to thank you all for your participation today. And I think you have several theses to send to us afterwards. Yes. Do. So thank you very much. And I know some people will wanna talk to them as they're leaving, but please let them leave the room. Maybe they even wanna use a men or lay men's or ladies room. And while they are leaving, and I think their organizations are going with them, then we are going to call up our next panel. And, sorry. Okay. We have the Healthcare Association of New York State, also known as HANES, and the Greater New York Hospital Association, She and Oh,

[Speaker 10]: talk outside please.

[Speaker 51]: We're going

[Speaker 0]: to ask everyone, yes, to take their conversations outside. Thank you. As you can see from the number of people in this room and the length of the agenda, We have a long day ahead of us, but we're now moving into the model where everyone testifying only gets three minutes and everyone asking questions only gets three minutes. You're being a chair or a ranker gives you no special status anymore. So we'll just let the room get settled back in. Let our two guests, right, get their glasses of water, test whether they can press their, sorry, their microphone to go from red to green. Always sometimes more of a challenge depending on how which which microphone is your luck of your draw. Okay. And shall we go in the order that you're listed? B. Grouse and then Elizabeth Winn? Okay. Great. So the clock's at three minutes. And people, if you're coming into your seats, just try to be a little quiet as you come in. Thank you. Good afternoon.

[Bea Grause]: Good afternoon Chairs Krueger, Pretlow, Rivera, Paulin, and the esteemed members of this joint committee. My name is Bea Grouse. I am president of the Health Care Association of New York State. In recent years, I have testified to this committee about the chronic challenges facing our state's health care system, our aging population, workforce shortage, disparities in access, and unaffordability for consumers, businesses, providers, and government. Now adding to those chronic challenges, we now have a new and a very acute problem, HR1. The federal reconciliation bill passed last July. As you'll see in my testimony, Haines expects that in this fiscal year alone, HR one's financial impact on New York's hospitals will be $1,000,000,000. By 2033 and beyond, New York's annual impact will grow to an astonishing $8,000,000,000 every year. A recurring impact that's not remotely sustainable when half of our hospitals already operate in the red. To borrow a healthcare term as a former healthcare provider, this new landscape is what we're calling an acute on chronic situation where a person who has a chronic illness is made worse by an unrelated acute illness. Using this metaphor, we are now calling on each of you to help mitigate the worsening financial health care impact that hospitals, other providers, and the state of New York will face. And your action this year is essential and will make every difference. We appreciate that the governor's budget proposal acknowledges the magnitude of HR one and makes a strategic commitment to supporting New York's hospitals and nursing homes. We believe this commitment provides a solid foundation that we are urging you, the legislature, to build upon. In the interest of time, I will focus my comments on our key recommendations. First, Haney supports the executive budget's preservation of most of last year's promised investments for hospitals and nursing homes funded by the MCO tax as well as their continuation into 2027. We also strongly support the governor's proposed multi year targeted healthcare investment for hospitals and nursing homes. This will absolutely go a long way in helping hospitals and healthcare systems weather HR one's impacts in the next coming years. We urge the legislature to build on this investment by directing the 1,200,000,000.0 in the newly available MCO tax revenue for this purpose across the years to come. We also support the executive budget's commitment to $1,000,000,000 in new capital funding for the Safety Net Transformation Program. And we also once again urged the legislature to reject the executive's misguided proposal to cut $520,000,000 from the VAP VAP program. Haney encourages the legislature to include the provisions of the 340B Okay. All right. Yes. Absolutely. Well, thank you very much.

[Speaker 0]: And microphone is not working. So sorry.

[Bea Grause]: That's all right.

[Speaker 0]: Your full testimony is online for 20,000,000 New Yorkers to read, but you don't possibly get enough time now. No

[Bea Grause]: problem. Happy

[Speaker 0]: to Thank answer you. Hi.

[Elizabeth Wynn]: Hi. Good afternoon, chairs and members. Elizabeth Winn, executive vice president at the Greater New York, Hospital Association. This budget comes at a time where the New York health community is facing a devastating cut from the federal level from HR one, really the largest cuts in American history. The damage to New York includes 1,500,000 New Yorkers losing their health coverage And as Bea laid out, an $8,000,000,000 impact for New York's hospitals. And I would just point out we are uniquely impacted not only because of the estimated increases in uncompensated care, but also the direct funding cuts that will accrue to our hospitals, especially our safety net hospitals. The executive budget really lays a strong foundation to help mitigate these cuts and their impacts. We strongly support the continuous implementation of the MCO tax and the investments that were laid out in the executive budget, as well as the new $750,000,000 appropriation for hospital and nursing home rate investments, as well as the new safety net transformation initiative investments from both capital perspective as well as critically needed operating funds. The good news since the executive budget came out is the new $1,200,000,000 in additional MCO tax revenues that are expected to accrue over the next nine months. We would like to see those reinvested back into the healthcare community and used to extend the life of the investments that have already been implemented. Two areas of concern I wanted to highlight. First, the safety net VAPAP cuts. The $500,000,000 cut is really devastating for those hospitals that rely on that funding. And it's really funding that's used to meet payroll, ensure benefits continue, and keep the lights on at many of our organizations. I also want to highlight the changes concerning the IDR changes. While there's many different facets to this proposal, I want to highlight our concern about moving to the in network median rate that was laid out in the executive budget. We see that that will only tilt insurance and provider negotiations back towards the insurers. These are already contentious in many cases, and we think that that's really unnecessary. And then lastly, we do support the adoption of the 340B Nondiscrimination Act. 340B safety net providers are under multiple threats at the federal level seeking to essentially strip 340B benefits from our hospitals. And so we urge you to adopt this this year. Thank you.

[Senator Sean Ryan]: Probably won't be able to completely answer, but is there any way to possibly estimate or quantify how much the 340B impact would be to hospitals?

[Bea Grause]: I'll start. Don't

[Speaker 7]: think

[Bea Grause]: we have the quantification around that because it's almost like death by a thousand bites. But I will tell you that the 340B program allows qualified entities to purchase, mean to receive discounted prices on outpatient drugs. And those savings as not for profit hospitals and FQHCs, those savings go back into programs for patients. So the smaller that the 340B program gets, the savings go back to pharmacy. There's no taxpayer involvement in the 340B program. So really, consumers lose the smaller that the 340B program becomes, which is why we support the bill.

[Elizabeth Wynn]: JEANNE Yeah. I would just add, if I could, that we do see that the 340B savings for many of our organizations really are a large part of the patient care margin that they have right now. So we're very concerned about any continued deterioration in that program. And lastly, would just add there is no state cost to enacting the 340B legislation.

[Senator Sean Ryan]: Yeah, we definitely have heard from as I said earlier regarding the transformation grant allocations and possibly dispersing that, but, you know, it it impacts rural health care. I mean, we and they're in dire need and it's you know, that loss of revenue stream would be really, really impactful. And you said death by 1,000 cuts,

[Bea Grause]: I but it's think

[Speaker 10]: we're close.

[Bea Grause]: J. Yeah, Senator, I think one of the themes that I have been hearing all morning are the challenges that we all are facing, certainly providers are facing, rural providers are facing, by relentless expense growth from many sources and then not enough reimbursement or revenue to cover that. And that is what is causing many hospitals, urban and rural, challenges around maintaining the level of services, retaining their health care workers, etcetera.

[Speaker 7]: It's part

[Bea Grause]: of a bigger problem.

[Senator Sean Ryan]: J. Think we've even gone beyond services. We're having a problem even recruiting doctors when there's more going out the back door coming in the front door, not just the lack of I mean, has to work longer hours, pay doctors, health care, and now you have to be driving further.

[Eric Linzer]: It's worrisome,

[Senator Joseph A. Griffo]: to say the least.

[Assembly Member Gary Pretlow]: J. Thank you, Senator. Assemblywoman Paulin.

[Assembly Member Amy Paulin]: J. Thank you. A couple of questions. First on the IDR. You know, what is there a middle ground?

[Elizabeth Wynn]: So we think the current approach is actually balanced, which looks at a multitude of factors, including the acuity of the case, what are some of the rates that the providers usually receive, or the providers charged, the complexity of the case, etcetera? And so we do think that the current system is balanced.

[Assembly Member Amy Paulin]: Understood. And I wondered if in the recommendations that you had, if there were any you wanted to highlight with the time that I have allowed.

[Senator Tom O’Mara]: J. Norber.

[Bea Grause]: J. Thank you, Senator Paulin. I appreciate that. I was starting on 340B. And I think that really was that and workforce, the importance of workforce, which we have talked about, and some of our payer priorities that we support in the governor's budget. We would actually like to build on both of those. So thank you. I appreciate that.

[Assembly Member Amy Paulin]: J. And related to the workforce ROBINSON: issues, scope issues are always part of what we hear. Is there any particular area there's a lot of scope bills out there that would benefit the hospital community.

[Bea Grause]: I think that we have our proposal around it's not in the governor's budget, but on CRNAs and allowing them to practice at the top of their license. I believe we also have another one on psychiatric nurse practitioners as well.

[Assembly Member Amy Paulin]: Same for you? J. Yep. Yep. J. Thank you so much.

[Speaker 0]: Senator Rivera.

[Speaker 10]: Thank you, Madam Chair. Thank you both for being here today. I just wanted to get the sense, since you represent so many health care providers around the state, that are going to see the impacts firsthand of what's happening in HR1. If you wanted to provide us with any like, what are your suggestions for how best to address the fact that so many folks are going to be falling off the rolls kind of by design because of federal changes in all of their requirements as far as eligibility. Anything that you can add to the conversation that we've already had about things that the state should be doing to make sure that we can have people continue coverage. J.

[Bea Grause]: Well, we certainly support the administration's efforts to try to preserve coverage for New Yorkers as much as possible. I will tell you, a federal level, a big effort that we're trying to do is preserve or decrease the impact of HR1 by trying to push back the effective dates of some of the provisions in HR1. If you look at page four in my testimony, a survey that Greater New York and Haines did, and I'll show it to you here, shows the impact over the course of the next five or six years of HR1. So we are trying to bend that slope or flatten that slope, so to speak, by pushing that back, which in turn would help providers keep their doors open and preserve access to care. And again, I think support the state's effort to ensure that there is coverage available to New Yorkers.

[Elizabeth Wynn]: J. If I could just add, I think it's obviously in our collective best interest to try and maintain insurance coverage for as many New Yorkers as possible. One of the things that there are many proposals floating around, and we'd be happy to talk to you about some of them. But addressing some of the affordability issues for individuals between 200250% of the FPL that are expected to lose coverage if the state returns to the basic health plan, I think they're creating a pot of funding that could be used to help kind of shore up coverage for that population would be important as well.

[Speaker 10]: Thank you. Thank you, Madam Chair.

[Speaker 0]: Thank you.

[Assembly Member Gary Pretlow]: Assemblymember Jenifer Rajkumar: Thank

[Assembly Member Josh Jensen]: you very much, Mr. Chairman. And, B, I just want to thank you. This is your last budget hearing for a while. I just want to thank you for your years of coming and answering our questions. Following up on Senator Ryan's 340B questions, I remember when the state originally decided to intercept that money, there was some concern about continued access to the types of services that hospitals were utilizing. Could you provide an update about whether all hospitals within the state are still able to provide those free services for underserved communities.

[Bea Grause]: J. Sure. That's a I can't answer definitively whether all are, but they are all trying to. And the 340B program as it currently exists today is absolutely, I think, as Elizabeth mentioned, a lifeline for hospitals to allow them to maintain the resources that they need to provide programs that help, for example, patients with special needs and need particular treatment and keep those wraparound programs for them available. So that is always top of mind for hospitals across the state to use whatever savings the 340B program provides to them to keep them open, which is why this anti discrimination bill is so important to make sure that that erosion of the program does not continue.

[Assembly Member Josh Jensen]: J. I know there were two hospital systems that are especially close to my concern that had exponentially higher impact when that event happened.

[Speaker 7]: Yep.

[Assembly Member Josh Jensen]: Has there been any his heinous conversations with the department, have they been has the department been receptive to working with health systems that are facing a disproportionate amount of loss from state action and a lack of these services being able to possibly be provided?

[Bea Grause]: J. Don't actually know the answer to that particular We question. We certainly certainly can can get get back back to to you you on on that. That. The department has been very receptive to our concerns around loss of access to care due to reduced reimbursement or other challenges, which is why I think the administration has advanced the Safety Net Transformation Program and is hoping that that will help. Essentially, programs are really designed to preserve access by lowering how much it costs to reduce health care. And the administration has been very open in trying to be creative around doing that. 340B is kind of a part of that conversation.

[Assembly Member Josh Jensen]: J. And very quickly, is the state doing enough to help hospitals with throughput issues?

[Bea Grause]: To do what was

[Assembly Member Josh Jensen]: Help with throughput issues with being able to clear beds, especially in emergency departments.

[Bea Grause]: I think that that is an ongoing challenge, as you heard Amir talk about. Think in some areas, such as Rochester, it's more acute. Yes.

[Speaker 6]: Thank you.

[Assembly Member Gary Pretlow]: Zellerman Wepprin.

[Assembly Member David Weprin]: Thank you, Mr. Chair. Nice to see you both here testifying.

[Assembly Member Gary Pretlow]: Let me know what

[Assembly Member David Weprin]: I know you've stated, miss Grauss, in particular stated, many many times that you appreciate the acknowledgement of the increasing care barriers that prior authorization and utilization review practices can impose on patients and providers and that you support the executive budget proposals to reform health plans related increases. You're probably familiar with my legislation, 3789. Can you speak to the importance of this legislation and what it will do to help patients receive care and providers to deliver care?

[Bea Grause]: And you referred to it as 3489, the pay and resolve?

[Assembly Member David Weprin]: 3789.

[Bea Grause]: 3789, the pay and resolve issue.

[Assembly Member David Weprin]: J. The what, I'm sorry? J. C.

[Bea Grause]: Pay and resolve?

[Dr. James McDonald]: J.

[Assembly Member David Weprin]: Yes. J.

[Bea Grause]: Yes. Okay. So I just wanted to make sure I was speaking to the same legislation. Yes, that would be a game changer. Our members, again, denials really just add to patient frustration and cost to patients. We think we estimate that it's about a $3,000,000,000 impact. And I think having payers pay the claim and then resolve any disputes therein would improve cash flow and would help patients get the care that they need. So we think it would absolutely be a game changer.

[Assembly Member David Weprin]: J. Thank you.

[Elizabeth Wynn]: J. Yeah. And if I could just add, I mean, this is really a critical priority for our members. One in four commercial claims are denied. And that's according to DFS data, right? It's not even our own data. It's DFS data. And every single denial puts up a barrier to patients accessing care. So strongly support the bill.

[Assembly Member David Weprin]: Well, hopefully we'll be able to do something about that in the near future.

[Bea Grause]: Again, in the larger scheme of things of trying to take bureaucracy out of an already very complicated system, we think this will go a very long way in helping support the work that hospitals do and helping to support the care that patients need.

[Senator John C. Liu]: Thank you.

[Assembly Member David Weprin]: Thank you, Mr. Chair.

[Speaker 0]: Thank you. Senator Webb.

[Senator Lea Webb]: Thank you both, for being here. I just have a a question. So I I'm aware that thirty two b j, their health fund, they did a written testimony and, with respect to flu shot administration and costs, associated with it. More specifically, they have data that demonstrates that flu shot administration averages around 23 in a doctor's office, but that same, service code averages around a $183 in a hospital outpatient department. And so with that type of a gap in cost and just given, you know, a lot of the conversations we've been having about affordability and access to to health care, can you kind of speak to that discrepancy and just kind of is that a kind of routine cost difference with regards to this particular service from what you all provide from your standpoint?

[Elizabeth Wynn]: So I can't comment on the specifics of their study, but I would just highlight a couple of things. Number one, one of the reasons that commercial rates are higher in New York is because of the chronic underfunding for both Medicaid as well as Medicare patients. And so hospitals are using higher commercial rates to the extent that they have access to them to offset the losses from Medicaid and Medicare. And I think that's a key difference. The second thing is hospitals are subject to a myriad of additional regulatory barriers that really are unique costs to hospitals. And those do get spread over all services.

[Bea Grause]: Again, I Elizabeth said it well. I think there are a lot of underlying reasons. We'd be happy to sit down with you and talk that through with you because the underpayments is really a big driver for the difference in prices. You're reflecting the difference in prices and also the operational challenges and the operational structure and the regulatory differences between a freestanding clinic and a hospital outpatient department is very different and those add costs.

[Senator Lea Webb]: J. There a recap that would be considered more reasonable from your standpoint?

[Bea Grause]: I don't know what you mean by a recap.

[Senator Lea Webb]: Like, just like recap level. Is there like are you looking at other considerations to try to lower costs essentially?

[Bea Grause]: Well, I think you're talking about, talking in your instance, you're talking about price. So we are very supportive about lowering costs, particularly lowering how much it costs to produce healthcare and there are many reasons for that.

[Senator Lea Webb]: We can continue offline. Thank you.

[Speaker 0]: Okay. Sure. You. Assembly.

[Assembly Member Gary Pretlow]: Assembly means Polisano.

[Assembly Member Phil Palmesano]: Yes. Thank you both for being here and sharing your expertise. My question is for Bea, if I could. And some of the questions that came came about, so I'm kind of evolving my question here. Certainly, I represent a very rural district in Upstate New York. I mean, part of bigger systems, operating systems, as we see. The Safety Net Program is a critical program. One of the things and concerns I continue to hear, what can be done to ensure and are you hearing from the membership you represent to ensure that these funds are equitably spent so many Upstate rural hospitals can benefit from this system, this program? Is there things that can be addressed to address that to help ensure that some of our rural hospitals can benefit from the Safety Net Program? Sure.

[Bea Grause]: I actually would like to see the administration be more forthcoming and open about what they have seen as successes for the Safety Net Transformation Program and what they would like to see in the future. What are the criteria, for example, that they are using to evaluate what's a good what programs or what partnerships are working well and which ones are not. That feedback and that evaluation would in turn inform applicants as to what the administration is looking for. So I would like to see more openness in that regard, which I think would guide applicants in the future.

[Assembly Member Phil Palmesano]: That's great. And on that same context,

[Speaker 10]: would it be helpful?

[Assembly Member Phil Palmesano]: Because I know the department was reviewing stakeholder feedback on some of the regulations and things of that nature. Are you getting any feedback or do you feel like your feedback's being heard or are they giving back feedback to you so you can adjust accordingly? Do you see action on that front?

[Bea Grause]: I think talking to some of our members, I think they have, in general, been pleased with their work with the administration, that it has been very supportive. You know, as you know, rural health care systems are struggling mightily over the many things that we've been talking about this morning. You've been listening to around rising expenses, challenges with recruiting and retaining physicians and nurses, and maintaining services to an aging population and their communities. So all facing all of those challenges, the Safety Net Transformation grants have been a lifeline to help them to kind of innovate and rethink that. So they're critically important, and I think they are, in general, positive about that. But I think more guidance, cliff notes perhaps, if you want to think of it that way, that would help applicants really understand what has been tried, what is working, so that they don't have to reinvent the wheel, so to speak.

[Assembly Member Phil Palmesano]: Thank you. I was going ask you a healthcare workforce question, but I don't think I have the time, so maybe we can talk offline. Thank Okay, you very sure.

[Assembly Member Gary Pretlow]: Assemblymember Gray.

[Assembly Member Scott Gray]: Thank you very much. Good afternoon. Appreciate you both being here today. So, B, this would be

[Amir Bassiri]: a question for you.

[Assembly Member Scott Gray]: I think you said during your testimony 50%

[Amir Bassiri]: of the

[Assembly Member Scott Gray]: hospitals are dependent upon some sort of funding. So distressed hospital funding, VAPAP funding, or some sort

[Amir Bassiri]: of Well,

[Speaker 10]: there's just

[Bea Grause]: they have zero margin or a minimum margin.

[Assembly Member Scott Gray]: J. Many so let's boil that down. So how many facilities do you have in your network?

[Bea Grause]: J. We have in the state of New York, we have little over 200 healthcare

[Assembly Member Scott Gray]: systems. So 100 of those facilities are looking for some sort of supplemental revenue to sustain themselves. Is that correct?

[Bea Grause]: Or they are they are at a margin at a zero margin. So they're either operating in the red currently and using reserves. Either they're using reserves. Right?

[Assembly Member Scott Gray]: Right. Zero margin or less. So do we know the average time it takes to disperse some of those funds to these facilities? So I've had three different facilities that I've worked with. They have taken them to the brink of a disaster. One was in default of a loan, right, of a payment. Another one was just about out of business. One declared bankruptcy today. What is the time frame that it's taken to get these funds dispersed? And what do you see as as an improvement for this process so it works more fluidly,

[Senator Tom O’Mara]: I guess?

[Bea Grause]: I think the department really should answer those questions, but I do not think that there is an average time. I am not aware of an average time for disbursement. I think that as a hospital becomes distressed, it is a very unique circumstance. And Elizabeth, you can certainly chime in here. So I think that it really depends on the unique circumstances of the facility. And I certainly know that the administration takes it on a case by case basis. But I do think that the department, I think, would be in a better position to answer some of those questions.

[Assembly Member Scott Gray]: J. Do your members, so let me just follow-up. Do your members, all the members of your association, do they feel that the process is working adequately?

[Bea Grause]: I think our members are extremely grateful for the, for the support.

[Dr. James McDonald]: Of course.

[Bea Grause]: J. I think that we certainly recognize that the state does, in this budget, is providing more than $3,000,000,000 in support of funding for hospitals. I think that's an indication in and of itself. So yes, I do think that it's essential, but it's challenging.

[Assembly Member Scott Gray]: J. There's no question it's essential. Is it working properly, though?

[Bea Grause]: J. I don't know how to answer that question. I mean, think it is working. It is a hospital in distress and challenging circumstances.

[Senator Sean Ryan]: Hi.

[Assembly Member Karines Reyes]: Good afternoon. So in the executive budget, there was a the executive proposed 4,200,000, for best practices for health care providers to retain permanent staff. So I have a question around that, and I don't know if you have the answer. But what percentage of your member's workforce is temporary versus FTEs? And what would you say are some of those best practices that would reduce the reliance on temporary staff?

[Bea Grause]: I'll do a quick one. So I think there is it varies by region. Can tell you from speaking to hospital leaders across the state, every hospital leader would love to not be able to rely on temporary staff. They would love to have a complete employed staff. But it does vary.

[Elizabeth Wynn]: J. Yeah. And I would just say, I think we've seen pretty significant improvements in being able to employ staff, especially since the end of the pandemic. So the last three years, we've seen a real trajectory towards additional employment. There are definitely pockets of issues that are concerning.

[Assembly Member Karines Reyes]: Well, I know oftentimes it's cited that there is a a workforce shortage, particularly in nursing, but it's been my experience that you often you often see nurses take on temporary nursing roles within the same area where they live. And I think there is an incentive for some of the hospitals to hire temporary staff rather than full time staff for a litany of reasons, but just wondering what efforts are being made to actually have FTEs as part of the workforce rather than

[Bea Grause]: J.

[Speaker 7]: Reliance I on think

[Bea Grause]: many hospitals are trying for magnet status. So they're trying to make sure that there's a shared governance model in their hospital that recognizes the profession of nursing. And, you know, certainly wages and benefits are a big factor as well in hospitals. And again, that's part of the essential nature of making sure that they are providing a competitive wage so that nurses will come to their hospital. The other factor, is that there is a, you know, I'm a nurse at the end of my career, but there are generational issues with younger nurses who really prefer to be temporary. So I think hospitals are experiencing that.

[Assembly Member Karines Reyes]: I mean, I think I think there are ways that can

[Helen Schaub]: that can

[Assembly Member Karines Reyes]: be incentivized.

[Assembly Member David Weprin]: But I

[Bea Grause]: just ways.

[Assembly Member Karines Reyes]: I mean, if this $4,200,000 would stand in the final budget, for this initiative to incentivize the retention of permanent staff and the reliance and to decrease the reliance on temporary staff. I would just hope that, your members are taking this seriously and and really doing the work to make sure they retain full

[Speaker 7]: time.

[Bea Grause]: You can't have health care without nurses. So yes.

[Dr. James McDonald]: Well,

[Assembly Member Karines Reyes]: full time versus temporary, you know, and I think that's the gray area.

[Speaker 0]: D. Thank you. Hi, I'm just

[Assembly Member Gary Pretlow]: going to

[Speaker 0]: slide in with three. So you were here when we were talking about the ghost networks problem for doctors before. And I think the assumption is that it's the insurance companies. But the hospitals themselves control just a huge number of the medical practices, certainly in New York City, and I think in a decent amount of New York State. So is there something else we should be demanding of you to make sure that your doctors aren't being listed as available to take on new patients in networks, even on your own websites, when they're really not? Just curious, how are you approaching this?

[Elizabeth Wynn]: J. So I think just for I mean, it's not only hospital employment. I mean, there's many other networks, private equity companies that have come in to create large multi specialty practices as well. So I don't think it's all on the backs of certainly not all hospital employment that you're probably referring to in terms of a trend. I think in terms of whether there's any discrepancies in networks, I'm not aware of that being on hospital websites as much as trying to from the insurance perspective, really consumers or really the insurance websites having multiple different types of plans and other things that may

[Bea Grause]: be adding to the confusion. I'd have to look into it. But I think from a consumer perspective, you know, if you're shopping for a physician, you would expect the data to be accurate and up to date. J.

[Speaker 0]: Do you know? Do the hospitals do their own auditing of doctors listed on their websites?

[Bea Grause]: J. I'm not aware of that, but I will ask that question.

[Speaker 7]: J. Okay.

[Speaker 0]: And you'll check also?

[Elizabeth Wynn]: Yeah, absolutely. Okay.

[Speaker 0]: Thank you very much. Sure. Assembly.

[Assembly Member Gary Pretlow]: Assembly member Norber. The second time. Okay. Assembly woman Forrest.

[Speaker 1]: That's it.

[Speaker 0]: Okay. No?

[Speaker 51]: No? Is she there? Okay.

[Speaker 0]: Yes. She's trying.

[Speaker 7]: Oh, there you go.

[Assembly Member Phara Souffrant Forrest]: Alright. Hi. Hi. My question is for vice president Nguyen. Following my former colleague from the assembly members from the assembly line of questioning, the CEOs of Montefiore, Mount Sinai, and New York Presbyterian increased their total compensation by over 54% from 2020 to 2023. For example, the CEO of Montefiore makes $16,700,000 while a nurse makes a $100,000, I just did the calculation, saving people's lives, providing direct patient care. Why then did nurses have to go for a month on strike with presby nurses still striking for hospital executives to agree to a modest salary increase and health benefits for their nurses.

[Elizabeth Wynn]: I would just say that we're very thankful that the two hospitals, Mount Sinai and Montefiore, have reached agreements with their nurses. I think it's really in the best interests of New Yorkers that these agreements were reached. I know the negotiations continue at New York Presbyterian, and we hope that those are concluded in due course.

[Assembly Member Phara Souffrant Forrest]: I still don't get to the root of the question. Is with executives making such high pay and I'm glad to see 11,099 in the room representing that with a CEO making $16,000,000 and the nurses weren't all asking for a lot, but just equitable pay so that they can provide the care that they need to give to the patients. Because ultimately getting beat up on the staff, beat up at the job, having healthcare, and then also taking home something that will guarantee you something, a little dignified life, like $16,700,000 would dignify some would afford somebody, why do they have to go on a strike? And even right now, we still have nurses on strike. Clearly, they have money to pay for the executives, lawsuits against the nurses for safe staffing. And remember, I'm a nurse too. For and then bus in out of state nurses and create AI facilities, all of that. But still, nurses have to be out of work for a month.

[Elizabeth Wynn]: Yeah. I'm glad that they've been able to reach a conclusion at

[Assembly Member Phara Souffrant Forrest]: PRESIDENT B. Still out.

[Elizabeth Wynn]: I'm sorry. J. I'm hopeful that they will reach a fair conclusion very shortly. Just on CEO salaries, I would just note these are very complex organizations that they are leading. There's a national market for the talent. And it's really with their boards and their that decide their compensation.

[Assembly Member Phara Souffrant Forrest]: If I can just say one When thing, I go to nursing school, I take care of complex organs as well. And so when the nurse comes in and the patient is I'm at the bedside, they're expecting a nurse who's very competent and well paid. So a CEO saying they're doing complex system, I never said that. I'm just saying, why can't a nurse be paid though for the complex stuff that they're Thank

[Speaker 0]: you, assemblywoman. Thank you.

[Assembly Member Phara Souffrant Forrest]: Thank you. I

[Speaker 0]: think oh, no. Kelles.

[Assembly Member Gary Pretlow]: Assemblywoman Kelles.

[Speaker 63]: All right.

[Speaker 59]: Just a few questions. What, in your opinion, do you believe is the reason the executive is proposing a system that gives large insurance companies more leverage over independent doctors? So this is with respect to IDR, especially those who staff emergency rooms and care for Medicaid patients. And can you describe on the ground what it will look like if this is actually put in place?

[Elizabeth Wynn]: So I want to tease out the issues. I think there's actually multiple proposals that the executive put forward. One is to remove Medicaid from the IDR system. So that's the first. And we are concerned that that could have an impact on hospitals being able to recruit doctors, especially for emergency room services where many of them are contracted. So that is one. The second is shifting for those claims that are part of the IDR process, shifting the factors that the entity that does the review can look at. And that's where you're moving from a system today where they're looking at a variety of factors, including what does the hospital usually get what did the hospital charge, what does the insurance company usually pay as well as a number of other factors to this 50% median in network rate. And one question is, what is the impact on out of network claims? But I think the larger context is, what is the impact that that's going to have on rate negotiations overall? If I'm an insurance company and I know that if I go out of network with somebody, that I'm only going to have to pay the median and network rate for that service, why would I negotiate something higher? I'm not concerned if they go out of network. And that's the underlying fundamental concern

[Speaker 50]: for us.

[Speaker 59]: And there's one other question. The executive has argued that hospital VAP VAP program is discretionary and less effective than more structured or rate based approaches. So that's the argument on the executive side. I wanted to just give a few seconds for you guys to give your side of that and what its importance is and how you measure success from those funds.

[Elizabeth Wynn]: So I think the VAPAP program has really been the critical lifeline and the glue that has allowed many hospitals, both urban and rural, to keep their doors open over the last almost decade that that program has existed. And we are very concerned about the $500,000,000 cut to that initiative in this year's executive budget proposal. That can really that that is the tool that the executive has, to make funding decisions for hospitals to be able to keep their doors open.

[Speaker 0]: We're going to thank you both very much for your testimony today and excuse you. And we're going to call up the next panel, which is 1199, Helen Souff, 32BJ, Misha Sharp, New York State Nurses Association, Leon Bell. That's panel b. Thank you. As

[Bea Grause]: I as it was mentioned earlier, I am retiring, but I did just wanna thank each and every one of you for the work that you do here in Albany and back in your community. So thank you very much.

[Speaker 50]: Thank you very much.

[Senator John C. Liu]: Thank you.

[Bea Grause]: Thank you.

[Speaker 0]: Good afternoon. Okay. I told everyone this would be a long day, just keeping you up to date. Thank you all for being with us today. And why don't we start with Helen Souff and then go across to Misha Sharp and then Leon Bell. Good afternoon.

[Helen Schaub]: Good afternoon. Thank you so much for having us here. And thank you for the opportunity to testify on behalf of our 300,000 members in New York State, some of whom are here with us in the hearing room. I won't repeat what many other people have said about the devastating impacts of HR1. Just to say we're really calling this code red for New York health care. It's the context in which this whole budget is unfolding, not just this year, but for a number of years to come. We do believe the governor, in her proposal, took the challenges seriously and put real resources on the table. We appreciate that. We think we're a piece of the way there to deal with the at least initial stabilization from the impacts of HR1. But we certainly ask the legislature to get us all the way there. One is to make sure that the additional dollars which the federal government has allowed to be collected under the MCO tax are kept in healthcare. As well as if we don't need the $2,000,000,000 that were set aside for supporting the central plan to keep that in healthcare. VAP VAP has to be restored. I'll say this week we're in the middle of two crises if not more with hospitals not making payroll, filing bankruptcy, etcetera. We need that VAP VAP money. We want as much of the dollars being invested as possible into permanent rate increases. Not just kind of one off year to year investments which make it very difficult to do things like settle contracts, etcetera. We've got to address the low nursing home rates, particularly upstate because those facilities are not able to retain their staff, invest in their staff in the way that they need to and fully restore nursing home capital. Finally, we think this is actually the year to set ourselves up for the crisis to come. Mean, I think there is tax revenue. There's other opportunities to invest this year. But the problems are going to get much, much worse as the cuts kick in. We have a couple of proposals. One is a savings proposal, the Home Care Savings and Reinvestment Act. Taking $3,000,000,000 in savings that isn't necessary being spent on insurance company admin and profit. Helping to reinvest that in our home care system and stabilize it. If we enact it this year, we're going to have those savings when we really need them. There's also an opportunity to tax the out of state profit transfers of major national insurance companies. It's over $1,000,000,000 in transferred out of state this year. As well as thinking about instituting an across the board MCO tax that would replace the one that was disallowed under HR1. That could give us some resources to invest particularly in maintaining coverage for those folks who might otherwise lose it. So I think, you know, we've got to stabilize. We're half, you know, three quarters of the way there to do that this year. But we also need to take steps this year to have the resources we're going to need in the much leaner years ahead.

[Speaker 64]: All right. Good afternoon. Thank you for the opportunity to testify. My name is Misha Sharp, the Assistant Director for Health Policy at thirty two BJ Health Fund. I'm here today to urge the legislature to prioritize health care affordability in New York's budget this year by including a fair pricing policy that caps the price of routine services at a reasonable rate. You can read more about the policy and its impact in my written testimony, but today I want to focus on why health care cost relief is necessary in the current moment we are facing and impossible to achieve without lowering the underlying price of care. Buying health insurance for your family in New York State now costs over $27,000 the second highest of any premiums in the country. We have the highest premiums for single coverage in the country. Our data and that of others consistently points to one overwhelming driver for those costs in New York, large, high priced hospitals. Federal cuts to coverage and subsidies will only expose more patients to these high underlying prices. Our members experience this on a daily basis. We had a member with a knee injury who went in to the doctor's office for an MRI, but it was coded as a hospital outpatient department. And that cost was $1,300 instead of $600 like it would have been in the doctor's office. Another had a sleep study done at home and when they got the bill, that $300 test had a 4,000 hospital facility fee attached, though they never stepped foot into a hospital. And one went to the same doctor for years for allergy shots that cost a $100, but when a large hospital system bought that office, the price went up to $7,000. These kinds of wasteful price increases rooted in consolidation and revenue ambition push New Yorkers away from seeking the care that they need. This is what a fair pricing policy would solve. Some would have us believe that not even a sliver of hospital revenue can be spared in service of patient affordability. But we're not talking about revenue from safety net public or rural hospitals who are exempt from the fair pricing act. We're talking about revenue from large consolidated health systems, five of whom have amassed over 30,000,000,000 in total net assets in less than a decade, a 100 increase. It is not acceptable that New Yorkers are forced to delay care due to cost or that nurses have to strike for safety on the job while large health systems use their resources to buy Super Bowl ads and pay their executives over $10,000,000 a year. The strong coalition behind the Fair Pricing Act, including labor partners, community organizations, and civil rights advocates shows the need for tangible and immediate action to lower healthcare costs. Thank you for your time.

[Speaker 6]: Good afternoon. Thank you for inviting us. My name is Leon Bell. I'm with the Policy Director of the New York State Nurses Association. Want to echo some of the comments that were made by my colleagues, brothers and sisters in the labor movement in terms of addressing the affordability crisis and, you know, supporting a lot of the proposals that are in the budget that do, you know, provide support for maintaining vital health services and, you know, keeping our hospitals and other healthcare facilities open for care. I would like to add three points though that I think need to be emphasized that are not really addressed or effectively addressed in the budget. One is we think that it is imperative that the state come up with its own resources to ensure that no people lose coverage going forward as a result of the cuts from HR1. And what that means and there are various proposals floating around that we talked about. But what that means is that we need to be looking at increasing revenues, taxing the ultra wealthy and the most profitable corporations to keep our vital services open. And we also need to be looking at using some of the reserves. Those are very ample reserves depending on how you count them, 30,000,000,000. We're not proposing that they should all be spent in one year, but they should be looked at as another source to prevent this disaster that's facing up to 1,500,000 New Yorkers who are going to lose their coverage in the next few years. Secondly, I think it's important to address abusive business practices and the budget does address a lot of abusive business practices, but in other industries and we need to be looking at the healthcare industry as well. There's already been some discussion today about excessive CEO, pay packages and, other executive pay packages. You know, the, one strike that's still ongoing right now, we have a CEO who was making $26,000,000 a year, which is almost the median salary for a household in New York annual salary. We should be looking at setting price caps and universal reimbursement limits to penalize excessive charges and pricing and redistributing funding from profitable or abusive systems to safety net providers. And an example I would ask you to consider looking at is in the Transport and Education and Economic Development Budget Parts and O and P. There are proposals to penalize utilities and energy providers by looking at their salary rates and also subjecting them to an affordability index. Finally, just want to make ten seconds just to say that we need to stop adding to the crisis, the staffing crisis in healthcare by making work more difficult for nurses and other staff. If I could just finish my sentence. You know, we're looking constantly to add to their workloads through these various proposals that also endanger patient safety and I think we need to stop doing that and start looking at ways to increase recruitment and retention in the workforce, which is the key

[Speaker 0]: to Thank addressing you. The sorry I have to cut you off there. Thank you.

[Speaker 6]: Thank you for giving me the extra Absolutely. 15

[Speaker 0]: Senator Rivera, our health chair.

[Speaker 10]: J. So I wanted to make sure that you got that last thought in calmly. I do have another question to ask a little later for the other folks. But if you could get that last thought in related to the last point that you were making before we cut

[Speaker 6]: we're seeing constantly attempts and this comes up repeatedly in legislation. In the budget, there were comments made today about flexibilities, etcetera. One example, just looking at this year's budget proposal, is the medication aids in nursing homes, right? On its face, it seems to make sense. The nurses can multiply their ability to dispense medications by having these untrained, unlicensed aids.

[Assembly Member Phil Palmesano]: But if

[Speaker 6]: you look at the actual legislation and this is a pattern that repeats itself The already difficult to recruit nurse in that nursing home is now going to be supervising possibly an unlimited or uncapped number of aides. That nurse is going to be totally responsible for going through a long checklist to make sure that the patient is safely getting the medications. All of the liability which is going to flow back to that nurse. So the nurse has to, you know, verify and affirm that the person is qualified and that the person is properly trained. In their opinion, the person is able to administer the given medication.

[Speaker 10]: It's just this long list. Since I already have so you only have a minute forty, but I wanted to make sure you got some of that stuff other thing, talk about the Home Care Savings and Reinvestment Act. I've heard of this piece of legislation. Could you tell us a little bit more about it, and more specifically, why you believe it should be prioritized this year, and how much we potentially save from it.

[Helen Schaub]: J. Sure. So this was a bill that was introduced several years ago. J. Think it's by somebody. Perhaps it was Senator Rivera and Assembly Member Paulin. And it would basically recognize that ten years ago there was an experiment to move all of home care under managed care, all of Medicaid personal care under managed care. The idea then was that it was going to save the state money and that it was going to move everybody into more integrated care programs where you could capture the Medicare savings. I think twelve years on it's very clear that experiment has failed. The size of the program tripled. It went up 300% during that period of time. So it cost the state a lot of money. It did not save the state money. And 80% of people are still in this Medicaid only product, where basically the state is paying the managed care company a per capitated rate. And that plan is paying for one service, which is home care. It's essentially pass through funding. It is not an insurance managing care and managing a bunch of different services. We think that if you eliminate the role of those largely for profit insurance companies, have the state pay for the care directly, and then have the state pay for care management directly, it saves about $3,000,000,000 a year.

[Speaker 10]: J. 3,000,000,000 a year, and it's 2332A to my colleagues. 2332AS, 3232A.

[Bea Grause]: Thank you

[Speaker 10]: so much. J.

[Speaker 0]: Thank you.

[Assembly Member Gary Pretlow]: Is somebody woman Gonzalez Rojas?

[Assembly Member Jessica González-Rojas]: Always fighting with the mic. Thank you both all for being here. And Leon, we stand with your nurses. So many of us have joined them in the cold as they continue to fight for dignified wages and working conditions. And we are with you. So thank you and we hope for a resolution at PRESB. Helen, I did want to follow-up on the Home Care Savings and Reinvestment Act. I did see some amendments to the managed care program in the budget in the executive proposal. But can you share more what was proposed and what's lacking in terms to address the issue you just mentioned?

[Helen Schaub]: Again, we think that there isn't really any tinkering around the edges here. You know, the legislature has invested billions of dollars to raise wages for home care workers, to follow the state law which requires those annual raises. And much of that money has not made it to the providers who are then responsible for paying those increased wages. And it's because under the waiver, the state has to delegate a bunch of authority to these managed care companies to set prices, to decide who they're contracting with. And there's very little transparency to be able to come through. You can't tinker around the edges because it's really fundamentally a structural problem with handing the authority for this program to these unaccountable companies. And we need to take them out in order to be able to set up an accountable and transparent system. And frankly to have the resources we need to support an aging population which is going to continue to need care. We can't afford to let that much money get sucked out of the system to get sent to Elevance and UnitedHealthcare and all of the other companies that are making money from this program.

[Assembly Member Jessica González-Rojas]: And Meeks, can you share more about where the opposition is to the proposal that you talked about? I mean, it seems fair to understand the cost of services that you're getting in the

[Speaker 64]: Absolutely. Absolutely. I think the opposition is into, cutting revenue from hospital systems in New York State and any potential concerns with downstream impacts.

[Assembly Member Jessica González-Rojas]: Impact the billions, millions of dollars they get in their salaries perhaps?

[Speaker 64]: That's correct. Yeah. We estimate about 1,100,000,000.0 in savings for New York, but that means it does come from hospital revenue. Based on our analyses, that seems like something that is withstandable and reasonable.

[Eric Linzer]: Think that's

[Speaker 0]: all I have to add.

[Helen Schaub]: Pose, can I share?

[Speaker 65]: Sure, sure. Absolutely.

[Helen Schaub]: So I think we would say a couple of things. One is we ought to talk about floors and not just ceilings because, again, we've seen the crisis with underfunding on the Medicaid side. It is you can't talk about what's happening with health care pricing and in the health care market without that piece of it since it covers 7,000,000 New Yorkers, number one. And number two, I think we would say we represent union workers in hospital clinics. We understand there's complexity to how this plays out. But there's reasons why hospitals, clinics are more expensive than doctors' practices. They see everybody. They have translators. They have social workers. They have very complex patient bases in a way that your average doctor's practice doesn't do, right? And can discriminate and not take Medicaid and not see complex folks. So there's a reason why

[Speaker 0]: Sorry, Helen,

[Speaker 50]: have to cut

[Speaker 0]: you off. Got it.

[Assembly Member Jessica González-Rojas]: Thank you.

[Helen Schaub]: It's my bill. Even though you agree

[Speaker 7]: with me.

[Speaker 0]: Even though I don't agree with you on my bill, that's okay. It's the clock that controls us. Thank you. Okay,

[Assembly Member Nikki Lucas]: Senate.

[Speaker 0]: Anyone? Oh, you're good? Okay. Oh, hello, Senator Gonzalez. I didn't see you come in. Please. Oh.

[Speaker 7]: Hi, it's so good to see

[Speaker 23]: you all today. I'm Senator Gonzalez. I represent Queens, Brooklyn, and Manhattan, and I also chair the Internet and Technology Committee. The intersection of health care and AI makes a lot of sense for a member like me, since I represent hospitals like Bellevue and NYU Langone and Hospital Row. We recently did an op ed actually with NICENA to talk about how some of the wealthiest hospital networks in the entire state are investing millions of dollars into artificial intelligence. In this year, we have a $1,500,000 proposal in the executive budget to put money into AI and health care. And what I'm trying to understand in the context of, of course, the challenges a lot of unions are facing in negotiating with these wealthy hospital networks for things like safe staffing, what your members believe about AI and health care. Because what I'm noticing is these hospitals are trying to move towards automation and outsourcing a lot of patient care. So again, we'd love

[Speaker 66]: to hear from all of

[Speaker 23]: you what your members think should happen at the state level.

[Speaker 6]: Sure. From NISA's perspective, I mean, is a problem that sort of appears across a range of sort of settings. First

[Speaker 7]: of

[Speaker 6]: all, there's the concern that there's no regulation. And we don't know how accurate these systems are. There's this gold rush mentality where dozens and dozens of companies are putting billions of dollars into creating these tools. And no one really knows how they work, how accurate they are, what kind of biases. There's also the issue in terms of overriding the professional opinion and autonomy of nurses and other health care workers in terms of you have to follow the program and that then steps on their professional judgment. And then finally, there's the workforce effects, right? One area that we're very concerned about is and this is combined with there were some comments supporting, for example, know, interstate compact for nursing is using out of state providers in low wage states to provide using AI and telehealth to provide health care across state lines for New York residents, displacing New York workers and replacing them with low cost staff from other states. So there's a whole range of issues. And I think that that's something that really needs to be looked at to make sure that we are not just

[Speaker 7]: sort

[Speaker 6]: of opening the door to these investors to just take money out of the system.

[Helen Schaub]: I mean, can say super briefly, you know, think our members would say sometimes there are functions that they might consider beneficial to help spend more time with patients, not doing notes, etcetera. So there's roles that AI can play. However, it has to be regulated, it has to be overseen, there has to be a strong labor voice in looking at the impacts and what needs to happen.

[Speaker 23]: J. Thank you. Looking forward to working to bring that labor voice into the process. J.

[Senator John C. Liu]: Thank

[Assembly Member Gary Pretlow]: you. Assemblywoman Kelles.

[Speaker 59]: Great. A whole bunch of questions. So I'll ask just a handful, try and get to a few. One of the things that I wanted to hear more about is the 10% increase in outpatient Medicaid rates. And I'd love to hear you describe a bit of what this has meant to practice for hospitals and clinics since it was enacted. And are there specific outpatient services like mental health, substance use that they've really been able to support more than previously, more, you know, support for nursing care?

[Helen Schaub]: I would say we have been underwater on Medicaid rates for a very, very long time, especially on primary care and especially on behavioral health. So the 10% is valuable. It's about trying to get above water, which we are not yet. Our Medicaid rates are still only 70%, 75% of the actual cost of care. So providers lose money seeing Medicaid patients. And any investment that we make is really about trying to help them break even.

[Speaker 59]: So it really is just scraping the surface.

[Helen Schaub]: J. It's important and it's important especially to invest on the primary care and behavioral health side because they were the worst but we're not above water yet And on those it disincentivizes investing in

[Elizabeth Wynn]: So that

[Speaker 59]: when Medicaid reimbursements are below cost, which they currently are, where do hospitals actually absorb that loss or make the cuts? Is the staffing is the first thing to go? Service lines, capital investments? What have you seen that the first actions they take?

[Assembly Member David Weprin]: J. It's all of the above, really.

[Speaker 6]: I mean, they'll unprofitable service lines. And what's an unprofitable service line? Maternity, pediatrics, you know, psych. Primary care. And you can see the numbers, primary care. You know, they'll look to, you know, increase their prices on the private market side, right, which is then the issue that we're facing with employer sponsored insurance, which is why I think one of the things that I was going to tack on to what Helen was commenting on earlier is that we need to be looking at uniform price setting across the health care industry in New York, not just setting price caps, but also setting sustainable reimbursement rates that will keep the safety nets functioning, will make health care more affordable for private employers, etcetera, etcetera, etcetera. And I don't know if you guys want to chime in.

[Speaker 64]: I do feel like there's an important point to make here on Medicaid rates, which do need to be higher. The floor needs But to be this correlation between Medicaid to commercial rates is flawed. Often the hospitals that serve the most Medicaid patients have the lowest commercial rates and vice versa. So hospital to hospital, that assertion doesn't really hold up.

[Speaker 59]: Thank you. That's really important. I wanted to make sure you guys had time to put that on the record.

[Speaker 7]: Thank you.

[Speaker 0]: Thank you. Senator Webb.

[Senator Lea Webb]: Thank you all for being here. I know we've been talking a lot about you know, most certainly workforce recruitment and retention. I know in the the budget, the governor proposes a 1.7 targeted inflationary increase. And I was wondering if you all could just kind of elaborate on where you stand. I think I know where you stand on that. Most of us would agree in large part that we need to increase that just given all the things that are happening. And so whomever can speak to that and then I'll go to my next question.

[Helen Schaub]: Sure. And that's really for human services workers. It also covers workers that we represent who provide care for people with developmental disabilities. You know, I know the advocacy community would really like to see at least a 2.7% COLA this year. It's been a little under 2%. And these are very low wage jobs. They are jobs that are very difficult to fill because they're often quite challenging but crucially important. So we would certainly support a higher COLA for those human services workers.

[Speaker 6]: J. Would echo that. It doesn't directly affect a lot of our nursing workforce, but it's ridiculous that, you know, these agencies are trying to get by on such low wages.

[Senator Lea Webb]: And then in that same vein with the, changes that h r one, puts into effect essentially, some of it this year and then subsequently up until 2027 and beyond. I know we talked about this a little bit. Well, certainly, it was reflected in some of your comments. But could you expand upon what are some additional considerations we should be looking at as a state to try to address some of these very important programs that most certainly your members play a major pivotal role in improving access to care. So I was wondering if anyone wanted to elaborate on kind of what are some things that you are seeing. I know our commissioner earlier alluded to, there was a question around people losing coverage and the commissioner had a differing approach on that. But I was wondering if you could expound upon that, you some of the things that you all are working on through your vantage point on that issue.

[Helen Schaub]: J. Can maybe start. So I would say one thing, it's important to recognize, people losing coverage has multiple impacts. Obviously for those folks who are then going to struggle to access care also means there's a spike in uncompensated care because they're going to still seek emergency services, other services that people don't choose necessarily to seek. And that means the providers are not going to get reimbursed because they're seeing a higher level of folks without insurance. We've made tremendous progress in the state in reducing the number of people without insurance. And HR1 really threatens to reverse that progress. And that's why we need to step up, intervene as much as possible to protect New Yorkers from these kinds of impacts. The last thing I'd say is part of the impact is these new work requirements that are going to go into effect on January 1. We have some ability to help people meet those. It's not that they're not working. It's that it's difficult to prove that you're working. And we ought to be helping people meet the J. Requirements Thank

[Speaker 67]: you all three for being here today and for taking time for your day to answer all our questions. But my comment question is more directed to Ms. Sharp. I really connected with everything you said in your opening comments. I represent parts of Long Island, and many of my constituents are coming to me and saying, look, I'm going to the hospital. I need to go to the hospital. I need to get this checked out. But I know that if I go to another country, a country of origin, the rate will be 10%. The cost will be way lower than they were supposed to be. What is your recommendation? I see that you've done a lot of research, probably you and your organization, that what could we do to help cut costs in hospitals? Or what would you recommend us as legislators do?

[Speaker 34]: J. Yeah, I think there's

[Speaker 64]: a lot of evidence in the American health care system that we don't use more health care than other countries. We're not sicker than other countries. We're not heavier than other countries, so there might be a little bit of evidence about that. Real difference is the prices of the care underlying the cost. And so especially on the commercial side, those prices have been allowed to rise over 100% in the past fifteen years. And so if we want to think about healthcare affordability and healthcare costs, there really is no other choice but to look at the underlying price of care.

[Assembly Member Gary Pretlow]: Have you

[Speaker 67]: spoken to specific hospitals and working with them in some way to get this done? Or is there some type of cooperation on their part?

[Speaker 64]: We have. That's a great question. As a health fund, we've been working to contract directly with hospitals. So relying less on the carrier and the insurer and some of the practices that have been raised today. When we do that, we've found that we've been able to direct contract for about 180 for 5% of Medicare instead of close to 400% of Medicare. So that is also, I think, a good solution on the self funded side.

[Speaker 67]: Thank you very much for answering my question.

[Helen Schaub]: J. I would just say, you know, we disagree on some things. But I think we concur that if we can take some of the complexity, the administration, the profit on the payer side out, that also makes a difference in controlling costs. Thank

[Speaker 7]: you.

[Assembly Member Gary Pretlow]: All right, Assemblywoman Forrest.

[Assembly Member Phara Souffrant Forrest]: Hi, everyone. Thank you so much, Helen, Meeks, and Leon for being here. So there were some questions earlier, and I don't know if you caught it, but, like, asking Medicaid director about, you know, people being dropped off of their insurance and even asking miss Winn about the idea that a CEO can make $16,700,000 and you have over 15,000 nurses on strike trying to ask for a decent rate so they could pay the rent. So my thing is that I like to this is a a comment, but then I'm gonna follow-up with a question. When people talk about nursing staff, they often think about RN title. Right? But they don't understand that under the RN title, there's LPN, licensed practitioner nurse practical nurse. The hey, the LPN. There's the LPNs. You have the CNAs. You have the PCTs. And when all of these titles don't get it together, then that backs up on some of the other titles, some of the other unions that are not here, DC thirty seven, with some of their cleaning staff, their support staff, clinical staff, care managers, everyone, behavioral staff, everyone gets backed up. And so when the nurses step out, it's because they're representing a larger systemic problem that is allowing a CEO to sit there in his hot holy chair, dollars 16,700,000.0, and not really addressing the patient, not addressing the staff, and not addressing the quality of care because no one should walk into the hospital and witness the nurse being beat up, much less the nurse witness witnessing herself being beat up. Can you talk more a bit about when we say revenue, we're not talking about revenue to continue to bolster $16,700,000 in salary. We're talking about an overall system that is crumbling, crumbling under this capitalism, but yet not prioritizing the patient and the person who's providing direct care to them.

[Speaker 1]: I'll jump in first.

[Speaker 10]: Yeah, so

[Denise Olivo]: thank you for letting know.

[Helen Schaub]: A lot to take on.

[Speaker 7]: Yeah, go ahead.

[Speaker 6]: NISNA is a strong supporter and advocate of single payer health systems.

[Assembly Member Phara Souffrant Forrest]: Yes,

[Speaker 6]: And New York Health Act. And we think that that's something that the state of New York should be starting to move to aggressively because I think we've reached the end of the road with the Affordable Care Act. It improved things. It added people. But we need to move on. And I think the only solution going forward is the single payer health system. And I'll let you guys also chime in.

[Helen Schaub]: J. You know, I think a lot of the problems that we've talked about today, you can trace back to the different ways in which our system allows profit to take precedence over care for people. And we have to have systemic solutions and we ought to do as many of those as we can do, whether it's on the home care side, whether it's through single payer, etcetera. Thank you.

[Senator Sean Ryan]: Here we

[Speaker 0]: go. I believe we are completed for this panel. So thank you all very much, and for all your members for sending you here and being here with you also.

[Amir Bassiri]: Thank you.

[Speaker 0]: Thank you. All right. And now as they slide out, we're going to be calling up Panel C, which is Primary Care Development Corporation, Healthcare for All New York, New York Health Plan Association, Medicaid Matters New York, and Alzheimer's Association for New York.

[Speaker 7]: Okay.

[Speaker 0]: If everybody wants to take their conversations outside so that we can continue with the next panel. Thank you. Okay. Great. We're Thank you. Okay. Let's see. Yes, my colleagues. Get back in your seats. Thank you. So Primary Care Development Corporation. Hello? Should we start with you, and then we'll just go down the list as it exists on paper. Hi. Yes.

[Senator Sean Ryan]: There we go.

[Amir Mansour]: Chair Krueger, Chair Parettlo, and members of the joint legislative budget committees, thank you for the opportunity to testify today. My name is Amir Mansour. I am the Director of Policy at the Primary Care Development Corporation, or PCDC. PCDC is a New York based nonprofit and community development financial institution whose mission is to strengthen communities and advance health equity by investing in and supporting primary care. We urge the legislature and the governor to center primary care in this year's health budget. A strong preventative health system that centers primary care is the most effective way to improve health outcomes, reduce disparities and control costs, especially as New Yorkers face growing threats to coverage and access. Primary care is a proven investment. It is the only part of the health system shown to lengthen lives, reduce disparities and lower overall costs. Yet despite accounting for over a third of all health care visits, some estimates say more, primary care receives just five to 7% of health care spending nationally. Estimates suggest that this number may be closer to 4% in New York State. More than 4,800,000 New Yorkers live in areas with a shortage of primary care providers and these workforce shortages are projected to worsen. That is why PCDC strongly supports the inclusion and passage of the Primary Care Investment Act in the FY '27 budget. This legislation would measure current spending, require transparency and ensure that New York moves towards investing at least 12.5% of its over healthcare spending in primary care. As threats to coverage, access and affordability grow and healthcare costs continue to rise, the time is now to advance policies that meaningfully invest in primary care. For more than thirty years, with the help of New York State, PCDC has delivered real results. We have worked in every assembly district and nearly every senate district supporting over 3,600 projects and providing more than $80,000,000 in affordable financing in just the last five years. We are grateful for the legislature's support of PCDC's work and its past investments in primary care access, education and financing. To continue critical research and public education work, we respectfully request the renewal of the Assembly's $450,000 appropriation for PCDC in the FY '27 budget. We also ask that the legislature invest $20,000,000 to expand the Community Healthcare Revolving Capital Fund which is held by DASNY. Projects financed by these funds will expand access to primary care and behavioral health in communities that need it most. In closing, investing in primary care means investing in healthier people. Thank you for your time.

[Speaker 0]: Thank you. Mia Wagner, Health Care for All New York.

[Speaker 34]: Thank you for the opportunity to testify. My name is Mia Wagner, and I'm director of health policy at the Community Service Society of New York. I'm here on behalf of the Health Care for All New York Campaign. ICFANNIE is a coalition of 170 organizations dedicated to achieving quality, affordable health coverage for all. In our written testimony, recommends initiatives to right size and reorient health care spending, such as establishing an office of health care affordability, enacting site neutral policy through the Fair Pricing Act, and investing in primary care. While I would rather spend this time walking you through these exciting proposals to improve our health system, it's critical to address how federal cuts have jeopardized the health insurance coverage of over 1,500,000 New Yorkers. In the executive budget, the governor allocated $3,000,000,000 in new state funded Medicaid spending to secure coverage for New Yorkers affected by federal cuts. Importantly, the budget was developed under the assumption that the federal government would reject the state's request to terminate its thirteen thirty two waiver and return to the basic health program or BHP. Hick Fanny supports this allocation. However, the legislature should also have a plan in place in case the state's request is granted. In this scenario, New York could use its BHP trust fund to retain essential plan coverage for 609,000 lawful immigrants at no additional cost to the state. While returning to the BHP would allow the state to access this trust fund, it would also change the eligibility rules for the essential plan as has been discussed today and would make 444,000 citizens and lawful immigrants newly ineligible midyear. Hick Fanny recommends a set of proposals to address these funding and eligibility changes, all modeled in a new Community Service Society of New York report. First, the legislature should consider establishing a six month state funded essential plan bridge program to ensure New Yorkers to become ineligible mid year remain covered until open enrollment begins. Depending on whether consumers are charged a premium, CSS projects that the six month bridge program would cost between 222 and $960,000,000 at the BHP baseline of a 125% of the Medicare Medicaid rate. Second, the state should continue in its history of providing coverage to immigrants with DACA and other residual pre call statuses. Providing state funded essential plan coverage for the small group would cost an estimated 29 to $50,000,000 a year. Third, the loss of federal funding for lawfully present immigrants would make qualified health plans even more expensive for over 30,000 New Yorkers. Legislature should consider establishing a state funded premium assistance program to make QHPs equally affordable for lawful immigrants as they are for their citizen counterparts. This program will cost an estimated $244,000,000 a year. In short, the federal government if the federal government accepts New York's request to return to the BHP and the proposed $3,000,000,000 does not need to be spent on state funded Medicaid, the state should have a plan in place to use these funds to retain coverage for as many New Yorkers as possible. Thank you for your consideration.

[Speaker 0]: Thank you. Next is Eric Lindzer, New York Health Plan Association.

[Eric Linzer]: Good afternoon, I'm Eric Lindzer with the Health Plan Association. Thank you for the opportunity to testify today. I'd like to highlight several items from our written testimony. First, we're picking up on a lot of the discussion today about concerns with HR one and the impact to the essential plan. Our testimony discusses the need for the state to allocate a portion of additional revenue generated from the MCO tax to continue covering as many individuals as possible within the EP, particularly if CMS rejects the state's application to move back to a thirteen thirty one. Second, our support for fully funding the Medicaid quality incentive program and codifying this program into statute. This program supports a broad range of initiatives between health plans, their providers, and community organizations to address racial and ethnic disparities in care, and improve health outcomes for underserved populations across the state. Next, our support for the changes to the state's no surprises act, both to exclude Medicaid from the IDR process, as well as revising the benchmark for payment disputes. Removing Medicaid from, you know, IDR would eliminate a loophole that high priced specialists have been exploiting to charge higher rates than what Medicaid would normally reimburse. And redefining the benchmark would be an important step to make healthcare more affordable for employers and consumers. Next, we are opposed to the restrictions in TED part HH subpart D that would restrict utilization from being conducted more than no more than once per year for a course of treatment for chronic conditions. This, you know, our concern with this is that it would eliminate the ability for plans to identify instances of duplicative or conflicting requested medications or therapies that could result in unsafe or unnecessary care, and wouldn't capture shifts in treatment or changes in an individual's condition when services no longer provide clinical value. And then finally, HMH part M section 11 discusses changes to the health plan hospital cooling off statute. You know, we have in our written testimony offered, you know, some suggestions for further revisions to that, specifically maintaining the provision that if both parties choose to waive, if mutually agreed to waive the cooling off period, they should be permitted to do that. With that, I appreciate the opportunity to testify and look forward to your questions.

[Laura Castle]: Thank you. Good afternoon. Thank you for the excuse me. Thank you for the opportunity to address you today. I'm Laura Castle. I'm the coordinator of Medicaid Matters New York. We are the statewide coalition representing the interests of people who have Medicaid for their health insurance coverage. Our coalition members are people who themselves have Medicaid coverage and their family members, community based organizations, community based providers, legal services agencies, policy and advocacy organizations, statewide associations, and more. The gist of our testimony is once again to highlight the importance of making decisions on the Medicaid budget focused on keeping eligible people covered, allowing them to stay healthy and well by having access to needed services and promoting independent living in people's own homes. The federal government is forcing our hands and the decisions made in the drafting of this year's budget will determine the impact federal actions will ultimately have on New Yorkers. Administrative activities and enactment of this year's budget will need to go hand in hand when it comes to how the state will mitigate the impacts. Steps must include implementing new federal requirements that are essentially paperwork barriers, including six month renewals rather than annual and Medicaid work reporting requirements in ways that will keep as many eligible people covered as possible. We know that the health department is working right now towards that goal. An affordable coverage option for the people who will lose essential plan coverage if that plan goes through as approved as if that plan is approved by the federal government. A state only public coverage for people who lose coverage due to the implementation of some of these federal requirements. Increased funding for consumer assistance as we know that the demand for help with individual cases will significantly increase. And funding for staff at the health department and easing of hiring processes so that they can have more staff capacity to implement and implement HR one and engage in essential oversight functions. There are opportunities within what's available in the budget and legislation which we list in our testimony which many of you sponsor to help New York meet this moment. Budget decisions must be made to increase funding for primary care and preventive care, including dental and community based mental health care, ensuring access to home care, along with keeping eligible people covered. All of these actions would reduce anticipated uncompensated care costs, which has been the subject of a lot of the testimony today. And I would be remiss if I did not include the I was going to include the words of a New Yorker who shared the importance of Medicaid to her and her family. You can read that later.

[Speaker 0]: Thank you very much. And then finally, Bill Alzheimer's Association.

[Speaker 55]: Good afternoon. My name is Bill Gustafson and I am the New York State Director of Government Relations for the Alzheimer's Association New York State Coalition. Thank you for the opportunity to speak at today's hearing. It was unfortunate to see the executive budget propose rolling back Medicaid coverage of precision biomarker testing. This shortsighted move will only cost the state significantly more on the back end. Alzheimer's disease already accounts for $6,800,000,000 in Medicaid costs, So reducing the easiest form of diagnosis from the state's toolkit to save $50,000,000 is by our estimation penny wise and pound foolish. Biomarker testing could democratize the diagnosis of Alzheimer's disease, but by rolling back Medicaid coverage, the executive budget harms the very people the state claims it wants to help. Therefore, the coalition respectfully requests that the legislature stand with the New Yorkers living with Alzheimer's and those yet to be diagnosed, oppose this harmful proposal and continue its long held tradition of tearing down barriers to access and reject it from the final budget. The Alzheimer's Community Assistance Program, or LCAP, was designed to provide evidence based education and support services to individuals living with dementia and their caregivers and to postpone or prevent costly nursing home placements. This approach works. The increasing prevalence of Alzheimer's disease necessitates additional resources to meet the growing demand and yet there has been no increase in NailsCap funding in ten years. Investing in this program not only improves the quality of life for those affected, but also has the potential to reduce long term health care costs by delaying the need for more intensive care services. Therefore, the coalition respectfully requests that the legislature include an additional 3,000,000 in funding for ALSCAP in the final budget to help the state meet its caregiver demands. The Centers for Excellence for Alzheimer's Disease or C. A. D. S. Were established to serve as diagnostic hubs but are currently bogged down with waiting lists that in some circumstances are more than one year which oftentimes force patients to go out of state for diagnosis. We cannot be the nation's leader in healthcare if we cannot get individuals screened in an appropriate amount of time. New and future treatments offer the ability to address the disease earlier and potentially save the state money by keeping individuals at home longer. Therefore, the coalition respectfully requests that the legislature include an additional 3,000,000 in funding for the CEDS in the final budget to help reduce the wait time and ensure New Yorkers have an early and accurate diagnosis. Alzheimer's disease is terminal and expensive. The disease's impact on the state's budget is immense. However, the legislature can reject unnecessary barriers to diagnosis, invest in programs that are popular with individuals living with the disease and their caregivers, and save the state money. Thank you for your time and consideration and I'm happy to answer any questions.

[Speaker 0]: Thank you. Senators? Yes. Sorry, Senator Gallivan.

[Senator Patrick Gallivan]: Mr. Gustafson, I just have one follow-up. You talked about the provision in the budget that the governor proposed to eliminate the biomarker testing for those enrolled in Medicaid. Do you have any estimate at all if this is removed, what a long term cost would be, whether it's extended over one year, five years, ten years?

[Speaker 55]: I wish I did. It's obviously a fairly new law. We know the current cost of the disease on the Medicaid system. Our facts and figures report comes out every year, and this past year, it was estimated at 6,800,000,000.0. The year before that, it was a 5.5. So we are scaling up and up and up in total costs. So the disease we are trying to pivot, obviously, we need to have strong long term care processes and placements and beds in place. However, the disease needs to be shifted to the forefront. We need to be finding people who have this disease already that might not even be displaying outward symptoms yet. And part of that, not just today, but one, two, ten years in the future, will be biomarker testing. So it is I wish I could calculate it for you, but the the long term cost of this disease, as the state already knows, are immense. So if we can do anything to try to move that forward to get people care earlier because there are treatments now on the market that do address the underlying the disease, There will be more in the future. So, we just need to keep up with the science.

[Senator Patrick Gallivan]: Okay. Thank you and thanks to everybody for your testimony.

[Assembly Member Gary Pretlow]: Benjamin Jensen.

[Assembly Member Josh Jensen]: Thank you, Mr. Chairman. It's Mr. Lunsford. What do plans currently spend the quality incentive pool dollars on currently? And what programs could negatively be impacted by cutting these funds?

[Eric Linzer]: Yeah. So, I mean, we certainly appreciate that the governor you know, had set aside $50,000,000 in this year's budget. We appreciate that the legislature has always been, you know, very active in restoring these dollars. The QI program, you know, provides funding or supports a number of different programs across the state. It's preventative screenings, it's in home wellness visits, vaccination efforts, maternal wellness. You know, some of the examples, you know, include, for example, providing home testing kits for patients to complete screenings at home for, you know, for colon cancer. It's diabetes management tools and education for individuals who are high risk, noncompliant. So it varies from region to region, it varies, you know, depending upon the providers you're working with, but really what it does is encourages plans, providers, community organizations to identify what are the needs in the community, meet the community where they are, and make the investments to address the individualized and unique needs of that community. With

[Assembly Member Josh Jensen]: the plans, you know, whether it's present fiscal year decision making or in out years as they're determining premium rates and coverage models, what does the impact of this funding fluctuating from year to year through budget negotiations? What kind of impact does that have on the work plans are doing?

[Eric Linzer]: J. Yeah, it makes it really difficult, not just for plans to plan out where they're going to invest those dollars, but it's also a challenge for those in the community, the providers that our members work with, the community organizations that they work with to make those long term commitments. If those dollars are in flux year to year, why would an organization want to make a two, three, four year commitment on something if the dollars aren't going to come in or the dollars aren't going to be there? So it creates those types of longer term challenges.

[Assembly Member Josh Jensen]: If this funding was statutorily required, would the plans be able to know, you know, kind of what what their pool money is gonna be moving forward and potentially bring down costs on the back end for consumers?

[Eric Linzer]: Well, you would know what the what the pool of dollars are. Keep in mind, plans don't receive these dollars unless they meet quality metrics. So the dollars would be there. Those doll you know, but if if, you know, plans and provider and community partners don't meet certain metrics, the dollars don't come in. That said, you know, some plan you know, those who perform at a higher level will receive more of the dollars. But it forces you to invest in quality.

[Speaker 0]: Thank you. Senator Thank

[Senator Lea Webb]: you all again for being here. My question specifically to to Laura, just thinking about a lot of the changes that are set to take place with Medicaid in terms of we talked about job requirements and just other things. I I wanna ask more specifically with regards to the executive proposal to repeal Medicaid continuous eligibility for children. And so I know this is something we've worked on quite a bit in the senate, and we're happy to, see that. And I know it was asked of the commissioner earlier. I was wondering if you could just kinda expound upon what are some concerns that you have with regards to this provision but also other changes that are set to take effect with respect to Medicaid? If you could elaborate on that.

[Laura Castle]: Sure. Thank you, Senator. It's really unfortunate that the state has to repeal the zero to six continuous eligibility as you said that was a big win for us. We became I think the eighth or ninth state to do that and CMS is breathing down the necks of the states that have enacted multi year eligibility to unwind those provisions. They've sent documentation you know letters urging states to repeal those provisions. Luckily we know that most of the kids in New York have coverage of some kind and we think that they will continue to retain coverage. It's just unfortunate that that paperwork barrier is going to be thrown at them again every year. And with respect to some of the other federal changes, we know that the health department is already working very hard to make sure that the people who will be not only having to document that they work but also doc people who will have to document that they are part of one of the exemptions from the requirement. So even if you don't have to show that you're working, you may have to show that you're exempt but because you have a disability or because you are one of the other exempt in one of the other exempt groups so there's a tremendous amount of work that needs to be done to make sure that this is done in a way that the fewer the least amount of people will lose coverage because we know that they're not going to lose coverage because they're eligible from you know, they're not eligible anymore. They're going to lose coverage because of the paperwork involved.

[Senator Lea Webb]: Thank you.

[Assembly Member Gary Pretlow]: Assemblywoman STEPHEN Paulin.

[Speaker 7]: J.

[Assembly Member Amy Paulin]: So we I have two questions for two different people. First for Mia. Your grace period of six months for I guess exactly what population are we talking about? And is it enough? Because if our waiver isn't accepted or thirteen thirty one isn't accepted, what then?

[Speaker 34]: Thank you for your question. This proposal is in response to if the waiver were accepted. So July 1, we know, is the earliest date that folks between two hundred percent and two fifty percent of poverty that have been eligible for the essential plan but would lose eligibility would be kicked off of that coverage. And so what we're proposing is just trying to get them to the open enrollment period. Now we're going to have more problems when we get to that point. And we're going to have to help folks in the marketplace to make sure they can actually afford the coverage that they may have an option for. But in the short term, we're just trying to think about if that proposal is accepted, how can we make sure that folks don't all fall off right on July 1?

[Assembly Member Amy Paulin]: So just take them through the I mean, did say that they would have an enrollment process that was easy, right? And it's up to them to open it up perhaps earlier or work with them. But I get the one of the solutions could be the grace period, thank you. Eric, what were you talking about with the cooling off period? I somehow missed that in the budget. And so did my staff. So I don't know what you're talking about.

[Eric Linzer]: J. On the cooling off period, there's a provision in the governor's budget that today, if you've got a health plan and a hospital and a contract dispute before or it gets to the end of the, you know, the contract, you know, normally there has to be, you know, right now the budget proposes going from, I believe it's you know, two months to, you know, up to four months. We, you know, we haven't taken a position on that. What the cooling off period does take away is if the two parties mutually agree to waive that cooling off period because you may get to a point where they say, look, know, provider may choose to no longer participate in the plan network or there might be other contracting, you know, other contracting issues. If they mutually agree, then you send notice and let the members or patients know. What the governor's budget is proposing is eliminating that provision and having to provide notice to the state that you mutually agree before determining whether or not you can waive the cooling off period. J.

[Assembly Member Amy Paulin]: I see. And is there a reason that you think you're proposing that?

[Eric Linzer]: J. Still, We expect to have further conversations with the administration.

[Assembly Member Amy Paulin]: Keep us all informed. Thank you.

[Speaker 0]: JEAN Thank you. Good. How are you? Welcome. Join us. Since

[Assembly Member David Weprin]: Mr. Lindsford is

[Speaker 22]: on the hot seat, just a follow-up question for you. I noticed that the New York Health Plan Association is pursuing changes to IDR. My understanding is that the IDR and the nonprofit Fair Health Standards really were born out of litigation between the attorney general and many of the major health insurers. What's the rationale? I mean, since it was resolved by settlement, what's the rationale behind pursuing these changes?

[Eric Linzer]: Yeah, there's two issues, Senator. One related to Medicaid, which the Medicaid director, I think, you know, talked to an extent. I think the big issue there is that the IDR process doesn't distinguish by between commercial insurance and Medicaid coverage. So you've got big differences there, what we're seeing is certain high cost, you know, providers that choose to stay out of network have identified the IDR process as a loophole for them to be able to, you know, to generate commercial like reimbursement rates when that's really not the role for Medicaid. The, you know, I think the issue on, you know, making changes to the, you know, the benchmark rate here is that, you know, the current state guidance recommends that the arbitrator consider the eightieth percentile. So it's, you know, basically an amount higher than what 80% of physicians in the network would be charging. So, you know, this is, you know, and as a result, that has an inflationary impact on it. So a 2019 DFS report had indicated that arbitration is about 8% higher than the eightieth percentile. Those costs translate into higher premiums. So under, you know, premiums reflect the underlying cost of care. If you've got providers that are choosing to stay out of network and recognize that they can get higher rates through the state's IDR process, what's the net you know, then you either have to pay them higher to get in network or you're going to continue to pay these high out of network costs. The governor's proposal is a measured, thoughtful approach that brings that gives more guidance to arbiters, including saying that you can consider the fiftieth percentile, but it does cap the rate at the eightieth percentile. So we think that this ultimately is going to benefit consumers and employers in the form of lower costs for, you know, through the IDR process.

[Speaker 22]: Thank you for your answer.

[Speaker 7]: Next

[Speaker 0]: we have Assemblywoman silages. What a battle.

[Speaker 49]: Since we'll continue with Mr. Lindzer, the quality incentive program. The prior panel is making this interpretation that this is like a handout. When we know that these dollars are earned by providers that demonstrate high quality care that delivers outcomes for patients. So during the conversation, it was mentioned that some of the money is retained by health plans, which I think is false. Do you think that is a true statement? And why you do think quality incentive program is so important? J.

[Eric Linzer]: Well, dollars flow through the plans. But ultimately, I think as I've mentioned earlier, you know, the plans only receive the incentive funding if they meet if they meet quality metrics that's that the Medicaid department outlined. So you've got to make the you have to make those investments either through working with providers in the community or community organizations or or both. So these are these are upfront investments that the plans are making. And also making commitments to their partners in the delivery system and the community so that if you do hit these metrics, are you, you know, you receive these dollars for essentially meeting the expectations that Medicaid wishes you wants you to make.

[Speaker 49]: And the outcomes are more so, you know, good patient care, you know, lower outcomes of, you know

[Eric Linzer]: Yeah, it's nationally recognized, you know, clinical benchmarks. It may be, you know, things related to, you know, immunizations, patient satisfaction scores, you know, diabetes related screenings, know, cancer screenings. So these are all things where we want to be making those investments, but it has to be a recognition that how you, you know, identifying what the needs are in the community is going to vary across the state and even in certain areas. It's, you know, the investments, you know, there are different investments in Queens than there are in The Bronx because, you know, those populations and the needs of individuals in those communities are going to differ.

[Speaker 49]: And we know that the funding has transitioned initially with general fund, then the MCO tax, and now we don't know. Do you have that are you concerned about the

[Eric Linzer]: Well, I mean, we're certainly hopeful that with the additional MCO tax revenue that's come in, that a portion of that could be allocated to increase, you know, to increase the funding for the QI program. But at the same time, codifying this in the bill into statute, 2,044 S6266 would go a long way to providing certainty to not just plans, but also, you know, our partners in the delivery system and community organizations.

[Speaker 49]: I definitely would want to see that codification. Thank you. J. You.

[Speaker 0]: Senator Rivera?

[Speaker 10]: J. Okay. Got a couple of quick ones. Ms. Cassell, you were cut off right at the end when you were about to share with us the experience of a Medicaid patient. If you could finish your thought there.

[Laura Castle]: J. Thank you, Senator. J. Yeah. J. I'll also take a moment to say this is a priority for Medicaid matters, which is to make sure that the voices of people who themselves have Medicaid for their insurance coverage incorporating their voices into the work that we do. So and we do that by asking them.

[Helen Schaub]: So

[Laura Castle]: I wanted to share the words of Nancy in New York City who said, my mother cannot work and was diagnosed with kidney failure when I was a kid. She's a two time kidney transplant recipient. Medicaid has kept her alive. Dialysis, two transplants, and all the medication and support in between have kept my mother with us all these years.

[Speaker 10]: Thank you so much for sharing that. And Mr. Mansour, very thankful that you talked about the Prior Care and Primary Care Development Act. I wanted to give you the rest of the time here. It's just, again, it's my bill. Shameless plug. However, it is an essential one. So if you could tell us a little bit from your perspective, why is this so essential to be able to take some of the funding gear and direct it towards primary care? And I'll give you the rest of the time.

[Amir Mansour]: Thank you, Senator Rivera. I just want to share a few statistics. 15% of New York residents reported not having a usual source of health care or a health care provider. 111 primary care providers per 100,000 residents in New York, but only eighty six in rural counties. Four in ten New Yorkers live with at least one chronic condition. Sixty six percent of New Yorkers delay medical care due to high costs. What we do know is that just one additional primary care provider per 10,000 people can reduce hospital visits by five point five percent, emergency room visits by eleven percent, and surgeries by seven percent. We know that primary care will result in healthier outcomes and reduced costs for the state. We think it's more important now than ever considering the impacts of federal R. One legislation, to invest in primary care and see these outcomes, both in terms of a healthy New York and reduce costs and really a benefit for the balanced budget of New York State.

[Speaker 10]: And I'll just finish by saying thank you for sharing all those statistics with us. Ultimately, this is something that I believe is not an expenditure, but an investment. As you said, it is something that investing in the front end means that there's a lot of cost in the back end that we would be able to, you know, avoid. So thank you for pushing it and I'm hoping that we can get it moved this year. Thank you, Madam Chair.

[Speaker 51]: Thank you.

[Speaker 0]: And I think we have Assemblywoman Jo Ann Simon.

[Speaker 17]: Thank you. Ms. Cassell, shameless plug in my department here. One of the things I noticed you mentioned is carving out Medicaid managed care from behavioral health, which is my bill. But more importantly, the Medicaid director indicated that there were there was some progress, right? That they had seen progress through that program. I'm not sure what he's looking at. Do you have you seen progress in that program? What do you think he's referring to? Or maybe you want to challenge that comment.

[Laura Castle]: I am not sure what he's referring to. There have been, you know, many advances in the area of behavioral health across different state agencies including the Department of Health. There have been advances for instance in services that are provided through health homes, services that are provided both through a variety of different providers. But I'm not sure I'm familiar with what he was referring to.

[Speaker 17]: Well, was particularly about the Medicaid managed care providers and what they have contributed to that. And so I couldn't quite understand what that was. So I guess you don't either know.

[Laura Castle]: Well, I think there probably are many managed care organizations that really do try to serve people in the right ways but the structure, I don't have to tell you because you're the sponsor of the bill, the structure is such that it we've created a a middle entity that absorbs administrative cost in order to implement you know, to administer a benefit and we do think that overall despite the fact that there are plans that really do try and they do, you know, probably some of them really do a very good job that eliminating the the structure and and having that benefit be administered in a different way would benefit people.

[Speaker 17]: Okay, thank you. I appreciate your testimony.

[Speaker 0]: Thank you. Thank you. Senators? Okay, then I just have a couple questions. So you all to some degree are in the prioritizing access to primary care and lower cost care for people. You heard the discussion probably before about concerns around the ghost network issue, and I suppose that's a uniquely more problematic issue for Eric than the other four of you. But is there not a correlation between these ghost networks and people not being able to get primary care or early evaluation care or lower cost care? Because they can't find doctors, and therefore when they finally do get doctors, they're sicker. So do you see this as a problem for the perspective of the work you're doing and do you have specific recommendations of what more we can be doing?

[Eric Linzer]: I mean, I'll, you know, I'll start. I think there's a, I think from the behavioral health standpoint, I think there's some important context here that, you know, two things. One, I mean there's already, you know, we recognize, I think everybody recognizes that there's substantial shortage of behavioral health providers, not just in New York, but nationally, which I think, you know, certainly creates, you know, challenges. You know, plans have certainly taken steps following the AG's report and even before then you know, to, you know, verify the accuracy of their directories on an ongoing basis, secret shopper surveys, etcetera. One of the things that we had, you know, that had been part of the Attorney General's report, something that we had picked up on and tried to work with various state agencies was development of a centralized directory for community, for behavioral health and sub providers that would improve some of the accuracy, you know, accuracy of these ories, but also ensure that patients knew where services could, you know, were available. So, you know, that I think is a recommendation that, you know, deserves, you know, more thought and consideration that I think would address some of the concerns that you, Senator, have raised today.

[Laura Castle]: Please. Sure, thank you. I can't say that we have done a tremendous amount of work in this area but over the years the advocacy community has done work similar to what Eric just mentioned, things like secret shopper programs and promoting promoting different ways to bring light the fact that there that there are networks that don't have the the services available to them because they lack the right practitioners.

[Assembly Member David Weprin]: Yes.

[Laura Castle]: And I think that some of this does go back to oversight on behalf of the state agencies, making sure that the networks are adequate. It's it's not only about, you know, making sure that there are director sorry, I took the time.

[Speaker 0]: Sorry, my time is up. If any of you wanna follow-up with me afterwards, please do. Thank you. Assembly, you came in just in time.

[Assembly Member Gary Pretlow]: Assemblywoman Forrest.

[Assembly Member Phara Souffrant Forrest]: Yeah. Okay. So thank you for everyone on the panel. I do have a question for mister Gustafson regarding Alzheimer's and treatment. One of the I don't know if it's intended or unintended consequences of HR one is that a lot, not HR one, but the one big beautiful bill, is that a lot of research was cut. One of my constituents came came to me and and spoke to me about early onset, Alzheimer's, and his treatment was coming in from Virginia. And this is particularly close and personal to me because he also knew that my father had Alzheimer's till the very end. So can you walk us through on some of the other options? What could somebody whose trial is ending in Virginia, what are the options for them in New York beyond just the two medications that we know of? But what can one do to continue treatment, or what do you suggest as far as advocacy for patients with Alzheimer's? And it's not just an old person disease. It's actually young.

[Speaker 55]: Thank you for that, and apologies for your your family's connection to the disease. One of the I will start by saying, you know, regarding the one beautiful big bill, whatever we'll call it.

[Assembly Member Phara Souffrant Forrest]: Happily bill.

[Speaker 55]: We we have a robust advocacy approach in Washington and have been pushing back to make sure that any existing NIH research that was allocated is still allocated and we're still pushing for increasing funding there. In terms of the thing with the treatments, we are in this place today because of the immense research that has taken place for fifteen plus years now. Unfortunately, there's only a few treatments presently that are on the market, and those treatments are really only you can only be eligible for those at the earliest stage of your, cognitive decline, whether you were diagnosed with mild cognitive impairment or early stage Alzheimer's. If you, for instance, have to wait a year to get a PET scan, you may have progressed too far in your disease to even be eligible for these drugs. Now we are at a very early stage of this for this disease. These are breakthrough drugs that have never existed in the Alzheimer's community. So we're hopeful that there will be more in the pipeline, and there are. We have to be patient. That doesn't that's not helpful to someone today because everything else is just a symptomatic drug that Aricept my grandfather, oh, here. Here's some Aricept. Go home and, you know, that's it. So it it really we we have to be patient and allow the science to get there. But I do think within the next several years, are going to have multiple available treatments, means brings me back to the biomarker issue. We're going to need to get people tested as soon as possible. We all know about getting screened for breast cancer, colon cancer, prostate cancer. There should be some form of public awareness campaign, in my estimation, to get people screened.

[Speaker 0]: Okay. No. I already answered the question. Hi. I was just double checking. I had already asked someone else's question, so they didn't need to ask it. I wanna thank all five of you for being with us today and for all the work you do every day for New Yorkers. Appreciate your being here with us. And we're gonna excuse you, and we're going to ask panel d

[Senator Patrick Gallivan]: Yes,

[Speaker 0]: to take a look and see if you're on panel d and then head on down. Bill Hammond, Empire Center for Public Policy, Leading Age New York, Sabrina Barrett, New York State Association of County Health Officials, Heidi Bond, New York Health Foundation, David Sandman, and Community Health Associate, Healthcare Association of New York State, Chicanes, Rose Duen. Okay. Okay. Good afternoon, everyone. And we'll go down the order you're on the piece of paper. It makes life easier. So that starts with Bill Hammond.

[Speaker 7]: Afternoon.

[Speaker 0]: Afternoon. Press the button.

[Speaker 51]: There we go. Okay. Good. So we've heard an awful lot of detail about the health care and Medicaid budget today. I want to sort of pull back and look at the big picture. New York spends an awful lot of money on Medicaid. We are, you know, for as long as I've been paying attention, we're the highest per capita Medicaid spending state. In just the past, if this budget takes effect as written, in five years we will have added 75% state share of Medicaid. That's about four or five times the rate of inflation. And that's $21,000,000,000 per year in additional Medicaid spending each year. If you include federal aid, that's $33,000,000,000 a year. And I guess my question is what have we purchased with that $33,000,000,000 a year? It's not coverage because enrollment in Medicaid has gone down. And it's hard to see what we've bought in terms of quality because our average quality ratings for hospitals are still in the basement. I guess I would also point out that it's at this point there's not any backfilling for federal cuts that needs to happen, at least not on a large scale. In fact, within Medicaid proper, federal aid is going up this year, not down. It's going I don't know, I think it's 3,000,000,000 or $4,000,000,000 The one area where we are taking a hit is the essential plan. But we don't know how much of a hit because the executive budget has not provided us with that information. They've said, you know, one scenario is they get approval to go back to a basic health plan. The other scenario is, as far as I can tell from the financial plan, the essential plan shuts down in July, which I don't think anyone in this room believes is actually going to happen. But that, if it does shut down in July, that's 1,200,000 people who have to find different coverage. Another area where we need more transparency is that consumer directed personal assistance program, CDPAP, and we're now told that it saved over a billion dollars a year to consolidate it under a single statewide contractor. But we don't have any of the necessary context to I mean, guys have been trying to pry it out of the health department when they were here. What happened to all the people who switched to regular home care? What happened to people who fell through the cracks? We don't have that information. We also we don't even know how much CDPAP costs from year to year except when they dribble out that information occasionally. Another point I would like to make is that we're this budget oh, sorry.

[Speaker 0]: We'll have to read the rest. Thank you very much, Bill. Next, we have Sabrina Barrett.

[Sabrina Barrett]: Thank you for the opportunity to testify. Imagine waking up to learn that the nursing home your mother depends upon is closing and there are no nearby alternatives. That's the reality many New York families now face as our long term care system rapidly deteriorates. Our nursing homes are in a crisis, a closure crisis, and we are losing the good ones. The nonprofit nursing homes that invest in staffing, quality, and their mission to compassionately serve New York's families. Although nonprofit and public nursing homes make up only 33% of the nursing homes in New York, they account for 75% of all nursing homes recognized for top quality under the state's most recent NHQI results. Yet, that list was created, seven of those high quality homes have already closed or been sold. The rate of closures is accelerating. We've lost more than 4,000 beds since 2014, but about 1,200 of those since 2024 alone. That's 25% of our closures in just two years. The primary driver is inadequate Medicaid reimbursement rates, which are still based on 2007 costs, leaving providers underwater by an average of $150 per resident per day. Thousand more beds sit offline because we can't find people to staff them or pay the competitive rates they deserve. And nearly 70,000 beds are operating in financial distress. That's more than two out of three statewide. And this crisis extends beyond nursing homes. Adult care facilities continue to close, and half of the adult day health care programs have yet to reopen after COVID. Most New Yorkers don't realize how deeply this affects them. Hospitals depend on nursing homes to discharge patients. When they can't, ERs back up and people wait for care in hallways. Families travel farther to find a nursing home bed or shoulder impossible caregiving burdens at home. In our executive budget, Governor Hochul proposes $1,500,000,000 in new funding for hospitals and nursing homes, the only new funding stream for nursing homes. We are asking for half of this allocation to begin to stabilize the sector. Importantly, we aren't asking for half of all the funding that hospitals might receive. There is more than 4,000,000,000 additional dollars proposed for hospitals. We are just asking for half of this one allocation. We also support restoration of the 10% capital cut and request reinstatement of the remaining 5%, the only funds available for nonprofits to make essential repairs and service loans. Let me close with this. We are at a crossroads. One path leads to more closures, more distressed hospitals, and families pushed past their limits. The other leads to sustainable, compassionate, long term care system that protects older adults and strengthens communities. With targeted investment, including directing half of the new funds to nursing homes, we can choose the better path. Thank you.

[Speaker 0]: David Sandman. Oh, me. Not David Sandman. Heidi Bond, New York Association of County Health Officials.

[Speaker 37]: Thank you. Good afternoon and thank you for opportunity to testify today on behalf of the local health departments. My name is Heidi Bond and I'm the president of the New York State Association of County Health Officials and the public health director in Otsego County. Local health departments are the front line of public health. We protect residents from disease, prevent injury, ensure safe housing, and deliver essential services to children and families in every community. At a time when federal public health programming is increasingly unstable due to staffing losses, stock work orders, and reduced reliable access to data, state leadership has never been more important. Local health departments are already feeling the downstream impacts and the sustained state investment is critical to maintaining a core public health capacity. There are many public health priorities to discuss and I ask that you please refer to our written testimony to see the full list. But today, I want to bring two priority requests to your attention. First, we ask that you restore funding for the Healthy Neighborhoods program. This is an evidence based program that provides no cost in home services to improve housing safety, prevent injuries, reduce asthma triggers, and help older adults remain safe in their homes. This program supports 17 counties in New York City, and the funding allocated by the state to support the program is unique and non duplicative from other revenue sources we have available. Healthy neighborhood staff provide practical tools like smoke detectors and carbon monoxide detectors, radon kits, baby gates, cabinet locks, and lead hazard supplies that prevent emergencies before they happen. We have several real life examples of these successes of this program that we can provide. One example comes from Cayuga County where smoke detectors were installed in family homes, which enabled the local fire department to assist in two house fires where everyone escaped safely and without injury. Eliminating this program would harm vulnerable residents and dismantle a trained public health workforce that is already stretched thin. Second, we ask that you strengthen and stabilize the early intervention program. Early intervention serves infants and toddlers with special health needs. We support extending the covered lives assessment, which is scheduled to sunset at the end of this year. However, we would ask for some modifications as counties are still not receiving the full assessment amount needed to sustain program coordination. We are asking for two fixes. First, that the state meets the intended $50.50 cost share of the covered lives assessment. And second, that the state establish a regular disbursement schedule so that counties can plan responsibly and maintain services for families. These are not new programs or expansions. They are practical prevention focused investments that stabilize systems already in place and protect New Yorkers where it matters most, at home and in early childhood. Thank you for the opportunity to speak today, and I will answer any questions you may have. Thank you.

[Speaker 0]: Thank you. Next is David Sandman, New York Health Foundation.

[Dr. David Sandman]: Thank you. I'm Doctor. David Sandman, president and CEO of the New York Health Foundation. We are a private, independent foundation dedicated to improving the health of all New Yorkers. Everybody in this room knows that New York spends a vast amount on health care, more than $300,000,000,000 a year to be exact. That's the highest in the nation on a per capita basis, and we don't not get our money's worth. Our health outcomes are average at best. The solution is not necessarily to spend more money. The solution is to spend our precious health dollars in smarter and better ways that return more value, And that means investing a greater share into primary and preventive care. Ben Franklin famously told us that an ounce of prevention is worth a pound of cure, but that's not what we do. We pay well for expensive technology intensive care, and we pay poorly for basic health care that keeps people healthy. Primary care is where prevention happens, where problems get caught early, and where chronic diseases are managed. But we underinvest. We have baseline measurements for New York, and they clearly show we only spend between 3% to 5% on primary care out of all our health spending. And that's a paltry amount that means that people can't see a doctor when they need one. We have primary care and workforce shortages in every part of the state. And when people can't get primary care, they end up in emergency rooms. An ER visit costs $1,200. A primary care visit costs $300. Those avoidable ER visits and hospitalizations cost the state billions every year. New York ought to join the national movement to rebalance its health spending. More than 20 states have already done so. New York is halfway there. Last year, the Senate passed the Primary Care Investment Act. It will require insurers to gradually increase their primary care spending to 12.5% and do so incrementally, just 1% a year, so as not to be too disruptive. And the positive results are piling up. Oregon found that every dollar invested in primary care saved $13 elsewhere. Massachusetts is showing better quality of care and lower spending. Rhode Island grew its primary care workforce. Primary care is one of the few win wins in health care. Better access, better outcomes, lower costs. We can't afford to underinvest in the very part of the system that delivers the best return for our dollars. If we want a healthier New York, we should put our money where the evidence is, and that's primary care. Thank you.

[Speaker 0]: Thank you. And then our next and last speaker, Rose Community Healthcare Association of New York State.

[Speaker 33]: Good afternoon. I'm Rose Duhan, President and CEO of the Community Healthcare Association of New York State, representing New York's Community Health Centers or FQHCs, federally qualified health centers that provide care for two and a half million New Yorkers. Health centers are essential safety net providers of comprehensive primary care, dental care, and behavioral health services in medically underserved areas. To ensure access to primary care in every community, I'm asking the legislature to secure the following in this year's budget. Dollars 300,000,000 investment specific to community health centers to ensure access to care in the face of devastating federal actions. Protect the 340B program from erosion to keep safety net dollars in vulnerable communities instead of being diverted to bolster pharmaceutical industry profits. Ensure full telehealth reimbursement parity for health centers regardless of patient or provider location. Health centers are struggling financially. Like every other provider in the health care sector that we have heard from today, they are facing stiff competition for workforce, steep increases in labor and supply costs, and insufficient Medicaid reimbursement. Unlike every other provider type, health center Medicaid rates are based on costs from 1999 and 2000, woefully outdated and inadequate. And I appreciate the nursing homes, but I'll take

[Speaker 59]: that and raise you seven years.

[Speaker 33]: Last year, the state budget included up to $40,000,000 to support community health centers. Ten months into the fiscal year, community health centers have not seen a cent of that money. And the division of budget's financial plan indicates that funding will not be coming to community health centers at all. With no warning and no explanation of why the funding was cut. Due to changes in Medicaid resulting from HR1, we estimate that the number of uninsured patients seeking care at health centers will triple, increasing to more than one third of all health center patients being uninsured. Health centers are disproportionately impacted by Medicaid coverage losses because of the high proportion of Medicaid patients they care for. Health centers will continue to provide care to their current patients who lose coverage plus many newly uninsured patients. These coverage losses will result in health centers losing an estimated $300,000,000 in revenue and that's why we have that ask. That loss of revenue will mean job losses in communities with limited economic drivers, an estimated 1,700 full time jobs lost in your districts and less access to care for patients. Without this critical revenue, community health centers will be forced to cut hours, close locations and eliminate essential services like prenatal care, labor and delivery, dental services, and school based health centers. Patients across New York State count on community health centers for the care they need and deserve. Can they count on you?

[Speaker 0]: Thank you. Senators? Senator Rivera.

[Speaker 10]: Hello. Good afternoon. Thank you for being with us. Will Mr. Samant, thank you for again reminding us of the Primary Care Development Act and how important it is to actually switch some of our spending there, making it smarter and a longer term investment. Ms. Tuhan, I wanted to actually give you an opportunity to talk about I'm sure that you've been here the whole day, so you've obviously heard the administration speak about particularly some of the talking about the MCO tax. Thankfully, we will have a little bit longer to be able to collect it. However, we've already collected a chunk of it, and it has not actually well, has it moved from members of your organization? Tell us what the situation is on the ground, please.

[Speaker 33]: Right. We haven't seen any funding from the MCO tax. We did hear the Medicaid director say that no funding has gone out. It's not

[Senator Joseph A. Griffo]: J.

[Speaker 10]: Said to his credit, he said not much.

[Speaker 33]: J. Not much. And it's not unusual to see delays. Think, as was talked about before, oftentimes there will be later a much you know, there'll be a rate adjustment that then will be retroactive to a previous period. However

[Speaker 10]: Yes.

[Speaker 33]: That is dependent on funding allocated in that previous budget. And when this year's budget came out, we saw that the funding that was allocated to us for the current fiscal year for FY '26 in the financial plan was zero. So that means that funding that was projected to be paid to us will now not be paid to us not later, just never.

[Speaker 10]: J. I want to make sure that I understand this, and I want to dig deep into this, particularly which is why I almost lost I flipped out over here when the commissioner was talking about, yeah, moved some money. Was like, we're talking about $40,000,000 What are you talking These organizations haven't actually received the money. When you spoke to the when you spoke I figure that you've spoken to the administration about this. What is their response, considering that we, again, last year, we debated a budget, we fought about it, we came up with how the allocation was going to be spread out, and we determined that everybody was going to get what they were going to get, and part of it was to have QHCs, which you don't have to underline how essential they are to such needy parts all across the state. What was the response of the administration about that money?

[Speaker 33]: They were not able to give us a reason about why we saw that in the financial plan, so we really don't have an answer about why that change was made.

[Speaker 10]: I want to linger, if I can, just to rant for a second, because I'm sure that somebody from the administration is either in the room or paying attention. Are you frigging kidding me? I'm just asking the universe. What do you mean, administration, because we're talking about, you know. We allocated $40,000,000 $20,000,000 and $20,000,000 right, dollars 20,000,000 in federal share. And yes, as was stated earlier, we did have to wait for it to be able to collect it. But at this point, it is I don't know, let me see, February 2026. And you have not been given it is not a it is not a good enough response when you had no response. And it is I'm beside myself, Madam Chair. I just don't know. How do you say that? Not going to get money that we decided that was going to be allocated to them. I'm sorry, I ran out of time.

[Speaker 7]: Thank

[Speaker 0]: you. Thank you. Assembly?

[Assembly Member Amy Paulin]: Yes, Assembly Member Forrest.

[Assembly Member Phara Souffrant Forrest]: Thank you so much, everyone here. I wanna as a nurse, I will say, who's worked in federally qualified health centers, I I see the importance of your testimony, mister Sandman, especially about, like, prevention is the first step. Any doctor, any person who's ever went to anything medical would tell you prevention is a step first step. I do have a question for, miss Bond. You talked about early intervention, and you talked about the lack of state support. What is the state covering now? You talk about the fifty fifty, but what is the state covering currently for municipalities with early interventions?

[Speaker 37]: Right now, it's a 40,000,000 covered lives $40,000,000 assessment. 20,000,000 was to go to counties, 20,000,000 to the state. The counties are only receiving 15,000,000.

[Assembly Member Phara Souffrant Forrest]: 15,000,000. Okay. So that means that the doctor or whoever can call

[Speaker 66]: for a

[Assembly Member Phara Souffrant Forrest]: referral, but it's just not being picked up, or is it it's incomplete? What does that actually look like?

[Speaker 37]: It's, putting more funding, responsibility on the locality. Mhmm. Okay. We're not getting the reimbursement that is owed to us, where before we could bill insure or receive insurance funding. Now we're not re receiving the insurance funding, and we're also not receiving the full amount of the covered lives.

[Assembly Member Phara Souffrant Forrest]: Mhmm. And I, you mentioned the idea of people, being able to come to the public health office and pick up things like a fire fire alarm, whatever, but also pack and plays. They can pick up things that literally save babies' lives. So this funding is very important. I also wanted to ask a question from, Rose. You talk about, FQHCs and literally $40,000,000 not showing up. But, and I have a FQHCs that serve my neighborhood. They're explaining to me that they know that the population will come regardless of what happens with the essential plan, regardless of any cut. They're coming, and they're going to increase. However, operation costs, the reimbursement is from 1999. What can you talk a little bit more about what that means when an FQHC close like Brown's, BMC or, BMS or Caribbean Caribbean house. Like, what does that mean when FQHC shut down?

[Speaker 33]: Yeah. Absolutely. And I think we've heard a little bit about that when there's no access to that preventive care. People are showing up in the emergency room because they don't have any other place to go. So something that might be treated easily in a doctor's office is gonna go to an ER. It's gonna be much poorer quality of care. It's not gonna be as good quality of care. It's gonna be much more expensive. There's just gonna be no place that people that that folks have to go to to get that care and to to work with the, to go to their trusted community health centers. We see this as a

[Assembly Member Jessica González-Rojas]: Thank you.

[Assembly Member Phara Souffrant Forrest]: Sorry. Thanks, Rose.

[Speaker 0]: Thank you. Our next up is Senator Gallivan.

[Senator Patrick Gallivan]: Thank you, Madam Chair. Good afternoon to the panel. Thank you all for your testimony. Mr. Hammond, question is directed to you. Last year I had asked you kind of an open question about what recommendations you had to for Medicaid and Medicaid spending. And it was kind of like it's kind of like a wish list, right? How to make it accountable, how to have an appropriate spend. So I'll try to I hope you had a whole year to think about it. I'll try to narrow it and I'll put it in different terms. So we're highest per capita in the nation. What would you recommend for New York to at least equal the average in the nation? So we're middle of the pack in per capita spending, and at the same time, your testimony was that you were not happy with the results that we're getting, get satisfactory results.

[Speaker 51]: J. Mean, I would not like going to the average on a per capita basis would be a 70% cut. And so I'm not going to sit here and say that that's a reasonable thing to suggest.

[Senator Patrick Gallivan]: What about reasonable recommendations? J. Did have

[Speaker 51]: a period early in the administration when they put a kind of inflation cap on Medicaid spending. And Medicaid spending slowed down. We've now basically taken that cap off and it's growing 10, 12% a year. So just slowing down the growth would go a long way over time to bring us more in line with national averages. Terms of Medicaid is such a huge sprawling program. It really probably should be considered 12 programs or 20 programs because it does so many different little things. And each one needs its own solution. But one common thread through all of them is just tighter management.

[Speaker 7]: You

[Speaker 51]: know, closer attention being paid to what the rules are for becoming eligible, what the rules are for becoming a provider, what the rules are for being compensated, and then sort of sitting on all of that to make sure it doesn't get out of control.

[Senator Patrick Gallivan]: J. Thank you.

[Assembly Member Josh Jensen]: Thank you, Mr. Chairman. Following up on that, Mr. Hammond, with looking at tightening up everything you just said, is there a state that has similar demographic data, health care concerns that is doing it sufficiently that New York should look for as to as a model?

[Speaker 51]: I mean, when I first got this job, I remember thinking, well, New York's spending must be driven by its demographics. We have high poverty or high disease or whatever. And then I looked at it and actually, no. Our poverty rate is only slightly above average. Our disease rates are pretty normal because we're a large state, and that's what happens. So we we don't have a particular challenge. I guess the one challenge we have is sort of a high cost of living. Okay. But but I guess the other the other challenge is is a political one. It's just a a reluctance to take on some of you know, the the hospital industry is one of the most influential forces there is in Albany. And so it's just very hard to say no to them or to demand better from them. J.

[Assembly Member Josh Jensen]: Okay. Thank you, Mr. Hammond. Ms. Barrett, you brought up in your testimony about LeadingAge asking for half of the $1,500,000,000 investment. Why does LeadingAge think that the nursing home should have half that funding?

[Sabrina Barrett]: J. So nursing homes rely on Medicaid heavily. We have about 73% of the folks we serve rely on Medicaid as the payer. And so there's really no other space, other place to make up those costs, whereas Medicaid is funding only about 75% of the actual cost of care. So our nursing home members are having to find another way to make up that 25%. And it's simply unsustainable at this point. The other thing that's happened is the case mix freeze has cost the system to lose about $100,000,000 per year. So by the 2026, that's 300,000,000 additional dollars that's been taken out of the nursing home system. And we believe that the only way to stop the closures is to get our reimbursement rates closer to the actual cost of care.

[Assembly Member Josh Jensen]: If that were to happen, would facilities that had to take beds offline, would they be able to bring those beds back online? Would they be able to hire the staff they need to be able to function to the top of their licensure?

[Sabrina Barrett]: That's certainly our hope. Our members are mission driven and we want to staff as good as possible. That's the reason why 75% of our members are the ones that are in the top quality as far as nursing homes go across the state. And part of the reason we are taking beds offline is because we can't afford to pay the competitive rates needed in order to staff those beds. So absolutely, a funding increase would go directly to providing better care for the residents that we serve in the form of hiring more staff.

[Senator Tom O’Mara]: J. Thank you. Senator Rhodes.

[Speaker 22]: J. You. Thank you, Ranker. Ms. Bond, I appreciate the fact that you're here. And I certainly appreciate your testimony. And thank you to all the panelists for their testimony. As a former county legislator in Nassau County, I know that every dollar that Nassau County collects in property tax revenue goes to cover the cost of Medicaid. And I know that Nassau County is not alone in that. Do you happen to know, out of the 62 counties, how many are in the same position as Nassau County that every dollar they collect in property tax revenue actually goes to cover the cost of Medicaid, not police, not parks, not any of the other services they provide?

[Speaker 37]: I don't, but I can bet that it's probably most counties that that is the the most costly thing that they have to pay for.

[Speaker 22]: J. Thank you very much. And I'm not shocked by that at all. It's outrageous. And we talk about unsustainability, and that word's been thrown around a lot. That's part of what makes it unsustainable, part of what makes the property tax burden unsustainable. Mr. Hammond, there are several things that you happen to mention, both in your written testimony and in some of your published articles. And I guess the crux of my question is going to be, what is the state of New York, and particularly the health department, doing to curtail some of the apparent fraud that is taking place within the Medicaid system. The reason that I reached that conclusion is that in your report, you referenced the fact that Census Bureau data shows that 5,500,000 New Yorkers have incomes low enough to meet the standard eligibility limits for Medicaid or the Essential Plan, yet enrollment in the program is 8,500,000. So roughly 3,000,000 people more than would be eligible financially are participating in the program. And also, you referenced that the state controller's audit found that the Department of Health may have improperly paid $2,600,000,000 in Medicaid managed care premiums to people that don't live in the state of New York. To me, that suggests a level of fraud that may actually compete with Minnesota. Is the state doing anything to curtail that?

[Speaker 51]: I mean, the state has an inspector general for Medicaid. It has a Medicaid fraud control unit. It has the controller's office. It has, you know, there's there's probably staff within the health department who are assigned to finding fraud. But I I mean, I think even the Medicaid director said we can always do more. I I've taken a kind of preliminary look at at the Medicaid fraud control unit, which it's a joint operation between the health department and the attorney general's office. And statistically, the number of investigations launched by them over the past five years per billion dollars of spending is the third lowest in the country.

[Speaker 22]: Well, with a $16,000,000,000 increase in spending over the last four years on Medicaid, we better figure it out.

[Assembly Member Gary Pretlow]: J. Is somebody woman Paulin?

[Assembly Member Amy Paulin]: Yes, hi. Actually, this is just for clarification. This year, the counties will be saving $9,200,000,000 in what would have been costs for them because of the cap. And I don't know when my colleague took office since I've been here a very long time. I remember when Senator Gallivan and I first introduced the cap bill, which was later put into effect. And therefore, the counties do not see an increase and, in fact, a decrease if their taxes go up every year. Thank you.

[Speaker 0]: Sorry. No answer required. Senator O'Mara.

[Senator Tom O’Mara]: Thank you. Just to follow-up Mr. Hammond and Senator Rhoads' questions there about what more we could be doing to root out the fraud and waste in the system. We're here all day. We've heard from hospitals and nursing homes that are going broke, they're not getting a high enough reimbursement rate. We've heard from nurses and other healthcare workers that they're not getting paid enough to get people to do the jobs. So, you know, it's a complex issue, I get it, but what more should the controller be doing? Or us as a legislature, what more should they be doing to be looking at this fraud? Since you just said, I think we're the third lowest in recovery of fraud. Is that the way I heard that?

[Speaker 51]: J. J. Investigations per billion. So we should be doing more investigations. I think that statistic indicates that if we you know, we should be investigating things more closely. The controller actually had a really good report, I think maybe two years ago, where the health department was requiring people in the home care business to use electronic visit verification. But then it wasn't actually basing claims on whether there was electronic visit verification. So the providers who didn't cooperate with the program and didn't implement this technology to verify that visits were taking place were getting reimbursed the same as the providers who did the right thing and adopted the technology. And the amount of money that he said, it was in the billions, was being spent on unverified visits. Now that, like that's one example of something that the state could be doing just to make sure that the home care we have an enormously large home care program, an enormously large home care workforce. We're spending something north of $11,000,000,000 a year just on consumer directed home care. We should be making sure that that care is actually being delivered as promised. And electronic visit verification is a way of doing that.

[Speaker 7]: J.

[Senator Tom O’Mara]: Thank you.

[Speaker 0]: J. One more. Thank you. Probably both for us, Doctor. Sedman and Bill Hammond, because you're both talking about how much money we're spending, but not getting what we ought to for that money. Also, while I'm here listening to all of you on different days, on different topics, I'm also reading other emails. And one of them that comes in is the updates from DASNY on people getting approval for bonds. And always the very largest are for private hospitals taking bonds out with private equity to build bigger and more expensive hospitals. And they're very often in my district in Manhattan. And so as I'm hearing the hospitals here today saying, you know, we can't afford anything that we need to be doing, and I'm hearing both of you from different perspectives saying, there's an awful lot of money going into these places, There's nobody who has to approve them. I mean, yes, DASNY has to get an approval, but basically they're going, okay, can you pay the bonds back? And apparently everybody thinks they can pay the bonds back because the ones I read today, Department of Health approved them. The bond market's giving them very high ratings on those bonds. So nobody thinks they actually have a problem paying these bonds back. Therefore, it raises a question about how much poverty they're in, because that's also what they've been telling us today. And yet, even though we know that the ongoing costs for everything that goes on in those hospitals is being driven by our health care policy and insurance policy and people having to pay higher and higher fees for their insurance. Nobody is actually processing whether it's a good idea to give them another billion over here or another billion and a half over here. That just seems to happen. So very quickly, should we have a different process that you have to get through before you get to get approval for all this money?

[Dr. David Sandman]: Well, if we want to change the system, we have to change the financial incentives. You know, I know dozens and dozens and dozens of health leaders, and I ask them, how much of what you do is about meeting community health need? How much is about chasing a margin? And they said, on the best days, 15% of what I do is about meeting community health needs. They all want things like cardiac cath labs because you make a lot of money on that. We don't need a cardiac cath lab on every street corner. In fact, consolidating that volume will improve quality. If we paid better for not tech intensive things, but for basic health care and primary care, you will change the system. Follow the money is always true.

[Speaker 0]: Bill, do you have a

[Speaker 51]: Just that in addition to the money that's loaned through the dormitory authorities, there's also just massive amounts of grants, just straight up payments made from the state to the hospitals to build stuff. And that's a relatively modern phenomenon.

[Speaker 0]: Thank you everyone. I think I was the last questioner on this panel. So I want to thank you all for your ongoing work and for being here with us today. Thank you. And next I'm going to call up, sorry, Panel E, the Medical Society of New York, the Associated Medical Schools of New York, the American Academy of Pediatrics, and two medical indemnity fund children parents.

[Speaker 56]: Let's take your break.

[Speaker 0]: Okay. So why don't we just go in the order that is listed on the agenda, starting with David Jakubowicz. I apologize.

[Dr. David Jakubowicz]: That's okay. Good afternoon. I am Doctor. David Jakubowicz, Director of Otolaryngology and Allergy at Essent Medical in The Bronx, Assistant Professor at Albert Einstein College of Medicine, and President of the Medical Society of the State of New York, representing more than 20,000 physicians, residents, and medical students across our state. Thank you so much for the opportunity to testify. There are positive elements in this budget. We appreciate the continuation of telehealth parity and the initial step towards limiting prior authorization for chronic diseases to an annual process. These are very meaningful reforms. However, the budget also imposes significant new financial burdens on physicians while allowing further reductions in insurer payments. At a time when community based practices are already disappearing, these proposals will accelerate consolidation, reduce services, and lengthen wait times for your constituents. New York is already one of the most difficult states in which to practice medicine, largely due to extraordinary liability costs. In 2024, medical liability payouts in New York exceeded those of Florida and California combined, despite our state only having one third of population. Policies that further increase financial pressure will only drive physicians to consider practicing elsewhere, worsening our accessibility crisis. We strongly urge you to reject the proposed $40,000,000 assessment on the 16,000 physicians who receive excess liability coverage, which would require them to absorb half of that cost. This four to five figure annual charge per physician dismantles a decades old compromise designed to partially offset New York's uniquely high liability burden. We also urge you to preserve access to high quality on call specialty care in emergency departments by maintaining New York's independent dispute resolution process. Eliminating the ability to appeal Medicaid managed care disputes to IDR would once again tilt the systems in favor of insurers at the expense of our patients and my physicians. Congress has recently scrutinized insurer practices nationwide. We asked the legislator to do the same and reject this proposal. Additionally, we ask you to reject proposals allowing physician's assistance to practice without defined physician supervision after eight thousand hours. In 2024, we worked collaboratively to expand PA responsibilities in a thoughtful, patient centered manner. We firmly believe that physician led team based care, with PAs providing a vital and respected role, provides the safest and highest quality care. Finally, please preserve the vetting role for county medical societies in recommending physicians for working compensation participation. The challenges within workers' compensation is not the application process. Thank you for your time.

[Speaker 0]: J. Thank you. We all have your full testimony.

[Dr. James McDonald]: Thank you.

[Speaker 0]: You just can't get through it. Okay. Next we have Jonathan Tayen, President and CEO of Medical Associated Medical Schools of New York.

[Assembly Member Matt Slater]: Great. Thank you so much. Thank you, chairs. Thank you, members, for the opportunity to testify this afternoon. Really wanted to focus on two workforce issues that have not yet been raised today. But before I do that, I wanted to note that this is the twenty fifth year that AMSNY has been partnering with the state to support opportunities for students from all backgrounds to pursue careers in medicine and science. And in fact, we were really pleased to see that the governor in the executive budget has proposed, $3,600,000 to continue the ams and y scholars in medicine and science programs. Those programs now, 17 programs around the state serving, 1,200 students. And again, these are students primarily from lower income backgrounds, students who are first in their families to go to college, and they are pursuing careers in medicine thanks to this work. Unfortunately, we're facing some headwinds to those efforts. The OBBA has established new caps on federal student borrowing, and in particular for the health professions, there's a lifetime cap now of $200,000 which does not cover the cost of the median cost of attending medical school or dental school, for that matter. And so this is a real concern, that we are going to disproportionately be pushing students from lower income backgrounds either out of medicine altogether or driving them to the private insurance market, which can be predatory. So state intervention here would be very much welcome. I would note that we also have the ams and y scholarship in medicine, which has been a legislative initiative since 2018, funded at $1,250,000 in last year's budget, and we hope to see the same this year. This really is important for our students to be able to actually afford medical education. Second issue I just wanted to briefly note is the effects of federal actions last year on our scientific workforce. We don't often think about scientists in the context of health care delivery. They're upstream of that, but without our scientists, we just don't get new treatments and cures. And we saw quite a lot of disruption to federal research funding last year. That has had a real impact, particularly on our early career scientists. We have proposed a large scale state investment through a new Empire Biomedical Research Institute that would fund biomedical research at the state level. You know, a lot of this is couched in economic development terms because investing in research is good economic development, but there are very clear implications for the health of New Yorkers. Thank you.

[Speaker 0]: Thank you very much. Next we have, sorry, American Academy of Pediatrics, Jeff Kaczorowski.

[Assembly Member David Weprin]: That was good.

[Speaker 0]: Thank you. It was luck.

[Speaker 56]: For ease, you can say Doctor. Jeff is fine. Senator Krueger, Assembly Member Pretlow, and enduring members of the legislature. I'm Jeff Kaczorowski. I'm the New York State Chair of the American Academy of Pediatrics. The American Academy of Pediatrics, or AAP, is first and foremost dedicated to the health of all children. And it does this work based on the best available science. Our national organization, and I am a board member for that, puts out three fifty different scientific statements, policy statements, clinical reports, all referencing with rigor the best evidence for what to do for kids and families. And it is in that spirit and with these recommendations that I come. Children's health and children's healthcare are in crisis. Look at the headlines of the paper. There are threats to their immunizations, to their access to care, to their nutrition, to their brain development. Pediatrics child healthcare is the one system of care for all children and families before kids enter school. We see kids on average 20 times before they turn three years old. Who are those kids? In New York, thirty percent of our population is 21. Thirty percent. Children are the poorest and most diverse segment of our population. Almost half are on Medicaid. And children are about, in New York, are about one out of fifteen children in The United States. That's incredible. We have recommendations about vaccinations, access to care, and improving early childhood. On the vaccination front, we urge the legislature to pass legislation that supports the AAP recommendations for vaccination. Those were issued January 2026, and you can find them in the attached testimony. In terms of access to care, there are a few important things. One is with HR one and zero to six continuous coverage being lost, we need automated, easy renewal for families to get care. We also need community health workers and support for community based organizations to be able to help them. We need Medicaid managed care to pay what Medicaid fee for service does for child health preventive care. There are many Medicare managed care companies that are not paying what we need, what fee for service is paying. And the last thing I'll say, and I'll let you read about early childhood, is that or I won't.

[Speaker 0]: We can read about it then.

[Speaker 56]: Yes.

[Speaker 0]: Thank you, Doctor. Appreciate it. Okay, next up we have two parents of children in the Medical Indemnity Fund, Cameron Brown and Denise Olivio.

[Speaker 40]: Good afternoon. My daughter

[Speaker 0]: Is your mic on?

[Speaker 40]: Yes. Think so. Sorry. Good afternoon. My daughter, Amelia Brown, was enrolled in the MIF in 2015. The initial MIF reimbursement rate structure did not work. We could not access critical care for our daughter. A 2016 unanimous vote put in place the current reimbursement rate structure, which restored access. The current budget seeks to revert back to a framework that would again eliminate access to care. There are, however, several viable alternatives to improve long term care, financial stability of the MIF without dismantling the reimbursement structure that enables enrollees to obtain critical services. First, primary insurance acquisition. According to the most recent MIF Actuary Report, approximately fifty percent of MIF enrollees lack any form of primary insurance, significantly increasing the cost borne directly by the fund. The actuarial data clearly demonstrates the cost disparity between insured and uninsured participants. Since inception, if you look at paid benefits to those without insurance, it's 441,000,000 versus those with insurance is 90,000,000. It's a significant delta. Second, and this is critical, funding transparency and adequacy. Since its inception, the funding mechanism of the myth has been unclear. Public health law 2,800 and seven(one) provides for the hospital quality contribution tax. However, it has never been clear whether that tax was intended to fund the MIF either in whole or in part. Moreover, since its inception of the MIF, it remains unclear whether the tax has been consistently collected from the hospitals. What is clear is that the hospitals have saved up to 1,000,000,000 to $1,500,000,000 The hospitals that have benefited the most financially from the MIF should be required to pay their fair share to ensure the MIF remains adequately funded and can maintain its current reimbursement framework. There should be full transparency regarding both the savings realized by the hospitals and the funding of the MIF. There are other things I would recommend, but it's in my testimony.

[Speaker 0]: J. Well, thank you. And I also want well, I want to thank you for all the work you've been doing on this for years, for many of us who try to understand what's going on. And then our next testifier, Denise Olivo, I only met today. And she and her husband recently lost their child after having them in MIF. So I particularly appreciate her bringing her perspective to us today. Thank you.

[Denise Olivo]: Thank you, senator Krueger and and senator Rivera, senator Mayer for allowing me to speak here today. So thank you very much. My name is well, good afternoon. My name is Denise Olivo. I am a a parent of a child who was in the New York Medical Indemnity Fund, and I'm also a licensed master's social worker. In addition to my personal experience, I am here as an administrator of the Medical Indemnity Fund Parent Support Group, and I'm representing approximately one twenty five families currently enrolled in the fund who share experiences and concerns informed the testimony I'm presenting today. I have brought a picture a photo of my son with me today. I am not presenting it for sympathy, but as a reminder that the decisions made in this budget hearing affect real children and real families. Families like mine were required to enter the medical indemnity fund as part of our legal settlement, surrendering significant portions of our financial recovery in exchange for the state's promise to fund medically necessary care for life. The issue before us is not whether the fund should exist. The issue is whether the state is honoring the obligation it assumed when the families were required to enter it. According to the most recent actuary analysis of the medical indemnity fund, the 2024 Pinnacle Actuary Report published in March 2025 and reflecting data through 12/31/2024, The fund carries substantial long term liabilities for current participants. In 2025, the legislature appropriated approximately 211,000,000, nearly four times prior annual funding levels to keep the fund operational and prevent closure. This makes clear that the question before this body is not whether the fund costs money, but whether those dollars are being spent in the way that actual preserve preserves access to care. Okay.

[Assembly Member Gary Pretlow]: Don't

[Denise Olivo]: understand. What remains missing is transparency. Instead of taking away from MIF families, the state should mandate hospitals to contribute the 1.6% quality care tax as enacted with the with the exception of the myth. Families and lawmakers still do not have clear routine reporting that shows how the medical indemnity fund dollars are allocated, how much is paid to providers, how much is consumed by administration, and how many and how decisions are made when services are denied, delayed, or interrupted. At the same time, families are experiencing real harm. In my own case, the fund stopped paying for nurses who have been providing medical necessity care for my son for seven years. Care, the fund had long oh, that's three minutes.

[Tracy Allen]: Yes.

[Speaker 0]: You. And I know that there are quite a few questions. So thank you very much. All right. So those are the five panelists. And we're now going to open it up to senators. And I believe Senator Rivera, you like to go first? J.

[Speaker 10]: Yeah. Two things. First, I don't know if there was anything not reading word for word, but if there's anything in the last part of your testimony, Ms. Olivo, that you wanted to share on the record before I ask my question.

[Bea Grause]: Yes,

[Denise Olivo]: actually. Shifting financial and operational risk onto families. The myth is created in a way that all the responsibilities onto the families. And families, we've already we're already dealing with a lot with our children. And granted, are wide different proportions of what those needs are. We should have been protected as a protected class because the families in the myth have already gone through litigation. And for us to continue having denials, delays, or paperwork to meet deadlines that don't exist with the current, like, with the current insurance companies. It's more of abuse in a system that we've already felt we've already entered

[Speaker 65]: hurt from.

[Speaker 10]: So this is a question. Thank you for that. This is both a question for you and Mr. Braun. Thank you both for being here and sharing your experiences and your families. I don't know if you had the opportunity to listen to the conversations earlier, particularly with the administration, where some of my colleagues, including myself, asked them directly about their actions, whether it was the addition of funding at the same time cutting the rates, which kind of seems kind of counterintuitive to me. But more importantly, that the commissioner claimed that there had been meetings and conversations that they've had. And then my question was to them, have you actually acted on those concerns that have been expressed by family members such as yourselves, and very likely yourselves, literally. So if you can share with us in the little bit of time that you have left whether you felt that the administration has engaged with you in any real way or not, what your concerns are, and whether you've seen any actual movement towards addressing those concerns in a real way.

[Denise Olivo]: Other than the Department of Health actually giving us an automated reply saying they received our email, no. And I do speak there is an online support group of families. And this is not just singular to me, right? This is systematic.

[Speaker 10]: J. Got you. I want to make sure Mr. Braun, did you want to add anything? J.

[Speaker 40]: I think overall what I've noticed is a and it's been, I would say, the last six months a general trying to control costs more aggressively. And that's basically through denials, Okay? So we're seeing more of that. I'm hearing a lot of families that are having difficulty, especially with respect to nursing and getting nursing maintained. That's an issue.

[Speaker 10]: J. And unfortunately, you're probably going to have to follow-up with the next person. But thank you for being here and thank you for your testimony.

[Assembly Member Gary Pretlow]: J. Woman Paulin.

[Assembly Member Amy Paulin]: J. First doctor, you didn't say where you live.

[Senator Dan Stec]: J. What?

[Assembly Member Amy Paulin]: J. You said where you work. You said he's my constituent and Shelly's.

[Dr. David Jakubowicz]: And I work at The Bronx, so yes. J.

[Assembly Member Amy Paulin]: KELLY: Anyway, thank you for being here. J. Thank you. For your comments on respecting the wishes or the direction of the American Academy of Pediatrics, and I would add, probably has MISNI's support as well, We do have bills that support that goal that I know are moving in the Senate. And I'm hoping the same will be in the Assembly toward that goal. So probably appreciate some memos of support. But we agree. To the MIF parents, do you believe you would have been better off going through litigation rather than dealing with the MIF if that had been an option at the time? J.

[Speaker 40]: Absolutely. Absolutely. J. I mean, really

[Speaker 10]: Closer to the microphone, please. You

[Speaker 40]: really see it now, right? Like, when there's a funding issue, immediately they gravitate towards, let's reduce reimbursement costs, which just eliminates access to care. Right? And it's just a constant fight. And it's exhausting. You're caring for kids. Is

[Assembly Member Amy Paulin]: there any discussion among the parents to the senator's comment earlier of potentially going back to court if the state changes the reimbursement to private duty nursing?

[Speaker 40]: J. I for sure think that would have to be a very viable option to seek recourse.

[Denise Olivo]: J. I agree. I think, I mean, someone best described it as the myth being New York State's dirty little secret. It's not good while it while to while you're in it. And if you close it, you cannot close it without having a recourse for families currently in it because there will be I mean, I'm angry. We're angry that we were in it. And if you stop it and you end it, that's fine. But there needs to be a recourse.

[Assembly Member Amy Paulin]: No. Understood. Alright. Thank you very much.

[Speaker 0]: Ms. Thank you. Senator Shelley Maher.

[Speaker 65]: Ms. Thank you very much. And I just want to first thank you, Doctor. Kazrowski, for talking about kids and not talking about institutions, talking about actual people that you care for. And I'm sure for all of you, it's something that is not talked about enough around here, in my opinion. So to that end, thank you. And so to both the MIF parents, and thank you to Senator Kruger for ensuring that Denise would have a chance after the loss of their son to come here so quickly. In addition to so as you know, the governor proposed to reduce the Medicaid reimbursement for in the MIF program in the coming year. And I'm hopeful that that that will be rejected by both houses of the legislature. But what's the impact of a reduction for you, Mr. Brown, in Medicaid reimbursement in terms of the ability for you to access providers?

[Speaker 40]: J. I mean, if we revert back to the original reimbursement framework, you literally cannot access providers. It is the zero percentile. The language in the budget would be an incredible setback.

[Speaker 65]: Because doctors because they're not willing to accept this lower reimbursement rate.

[Speaker 40]: Correct. You can't find PT, OT, speech, nursing, you name it. You end up paying out of pocket effectively.

[Speaker 65]: J. Yes, you have to pay out of pocket.

[Speaker 40]: Have to pay out of pocket.

[Speaker 7]: And then

[Speaker 40]: it just is not tenable because a lot of these kids the sickest kids in the myth, they need twenty four hour nursing.

[Speaker 65]: J. Yes, I'm aware

[Senator Jake Ashby]: of J.

[Speaker 40]: So it's just it's not viable. It's not a viable solution.

[Speaker 65]: I know you wanted to say something, but let me just ask my other question because I have limited time. You know, we've had a bill to require an ombudsman. And that came in part because of the frustration that the MIF parents have had with dealing with the Department of Health on their requests for approval of things. And I've heard from Ms. Oliver over the years requests for simple modifications of a home, other things where frankly the health department has not been an ally and has been an obstacle to your efforts to get, payments approved. Has that been I know, Denise, you can speak to that. Was that your experience? And how important would it be to have someone who was there to make sure you could cut through the red tape?

[Denise Olivo]: If I could cut through the red tape, sign me up. I mean, there's the ombudsman, there's there's nowhere families could go to grieve their their issues or to even try to find assistance other than our Facebook group, and we we talk to each other. Right? Yes. So that is definitely something that's needed. And, also, as far as lowering the price And what people need to understand, the New York Medical Indemnity Fund is not an insurance. There's no network.

[Speaker 65]: Understood. Thank you very much.

[Speaker 7]: Thank you.

[Assembly Member Gary Pretlow]: Thank you. Assemblyman Jensen.

[Assembly Member Josh Jensen]: Yes. Thank you, mister chairman, For the Medical Society and I don't mean to not say your last name, but I don't know how to say your last name.

[Dr. David Jakubowicz]: David's fine. J.

[Assembly Member Josh Jensen]: So you mentioned the excess liability insurance program in your testimony. What do you think will be the patient care impact if the proposal that the governor included in her budget to cut this program isn't halted by the legislature?

[Dr. David Jakubowicz]: The impact will be the fact that a lot of higher cost specialties, I mean, for example, we have general surgeons up in Skahari probably paying $34,000 a year. The ones in Nassau are paying $160,000 a year. Same covered lives, vastly different costs, vastly different jury pools. People will leave or people will decide to go bare. There will be less coverage. And these are going to be difficult decisions that doctors are going to have to make. Either leave the state, cut the excess, there'll be less coverage at Forrest with that, and potentially put their houses on risk and stuff. We don't have good homestead laws. So there are difficult decisions that's going to be faced by the physicians, the 16,000 physicians that I am the president of the organization, that they're going to have to make. And it's not an easy decision. We've relied on the coverage from this excess in order to provide some layer of protection for the physicians who practice. And I hate to see what would happen should they end up having to cover the 4 and 5 figure costs in order to maintain this.

[Assembly Member Josh Jensen]: Thank you. To Doctor. Jeff from American Academy, same reason why I'm not saying your last name. I've had pediatricians in my district and from across the state come to me and say that because of the Medicaid reimbursement rates, if they take over 25% of their payer mix as Medicaid payers, they risk not being able to serve any children in the communities where they work. Is that an accurate assessment of the ratio that they need to have? J.

[Speaker 56]: Yes. Know, kids are the poorest and most diverse segment of our population, so 50% of kids are on Medicaid. What's happening now is practices are closing or people are trying to make the difficult decision of whether they're going to continue to accept Medicaid, because most practices have a significant percentage of kids, 50% or more, by virtue of the, you know, the population of kids. So one of the things that would really help is the AAP nationally did a study, and it showed that a number of the insurers in New York are paying in their Medicaid fee for service Medicaid managed care rates less than what the state pays Medicaid fee for service. They're paying less. So we need parity. Just like we had mental health parity, we need parity in payment for pediatrics with Medicaid managed care. That would help a lot.

[Assembly Member Josh Jensen]: J. And I just, I know other members have said it, but I just want to say the two MIF parents, you very much for sharing an intensely personal story about your children.

[Speaker 0]: J. Thank you. Let's see. Senators thank you. Senator Rhoads.

[Speaker 22]: Thank you, Madam Chair. I want to thank all the panelists for their testimony today. But Doctor. Jakubowicz, did I get it right?

[Speaker 7]: J. No.

[Assembly Member David Weprin]: J. Close

[Speaker 7]: enough. Not even close.

[Speaker 22]: All right, I tried.

[Assembly Member Scott Gray]: J. J.

[Dr. David Jakubowicz]: J. I tried.

[Speaker 22]: J. Least I tried. J. J. Sort of

[Dr. David Jakubowicz]: my dual role as a member of

[Speaker 22]: the health committee and also as the ranker on labor, I wanted to dive into the governor's workers' compensation proposal with respect to the coding of physicians, which I know is in your written statement, and just ask you to comment on that.

[Chris Vitale]: It seems as

[Speaker 22]: though this governor has a this administration has a unique ability of identifying a problem, misidentifying the cause, and then creating a solution that makes it infinitely worse. And that seems to be the case with this particular proposal. It seems as though the we all want access for injured workers to have access to timely medical treatment. There is a lack of physicians who are willing to participate in the workers' compensation system. The governor's proposed solution is taking the coding ability away from local medical societies and instead allowing any doctor to be able to treat under the workers' compensation system, which actually may wind up exacerbating the problem. The root cause of having a lack of physicians who, in my understanding, who participate is that the system itself is so cumbersome that it makes it difficult for physicians, one, to navigate the system, and they simply don't want to participate and, two, difficult to get paid because the workers' compensation board refuses to hold carriers responsible for the failure to make timely payments and drags the process out. Would you suggest any other solution to that problem other than what the administration has recommended.

[Dr. David Jakubowicz]: MR. Senator Rhoads, I want to thank you for most of my testimony. I appreciate it. But yes, as far as the additional things is, we don't believe the issue as far as the application process. We believe that there is inadequate reimbursement, as you said, and also just not timely payments. So, it can stretch for months or years. So, the different insurers, there should be timely payments. There should be potentially penalties as far as with the whole thing. We need also doctors that specifically want to take these patients because there are different rules involved as far as the cares of these patients that's maybe not in the general population as far as the physician community. Plus, they also have to be fairly savvy. There's a whole different population. Not only are dealing with the patient, you're dealing with the insurers, you're dealing with the lawyers, you're dealing with the workers' comp board. So, we in the medical society believe that the counties do a good job in the vetting process. We think there needs to be a little bit more feet to the fire as far as on the payer side as well and some transparency.

[Assembly Member Gary Pretlow]: Thank Thank you. Assemblywoman Gonzalez Roxas.

[Assembly Member Jessica González-Rojas]: Thank you. First off, to our parents, thank you for sharing your story. And it really helps elucidate the challenges in the Medical Indemnity Fund. And I think we're all committed to addressing this. My question, though, is for, I'll say, Doctor. Jeff. Yes, please. I was the lead sponsor on a bill that was included in the budget last year, two years ago, that allowed for children in Medicaid and SCHIP to be able to be continually enrolled from zero from birth to six.

[Speaker 10]: Thank you so much.

[Assembly Member Jessica González-Rojas]: We know that reduces the churn that happens due to barriers and paperwork. This budget repeals that essentially due to HR one. Do you believe that there's something we could do at the state level with state dollars or with state resources to continue that program? And what other recommendations would you have to ensure that we keep our children insured?

[Speaker 56]: I think the loss of continuous coverage means that kids are really at risk to lose access to care. You know, the state estimated when it put together zero to six continuous coverage that if it hadn't done that, about 60,060 kids per year would lose coverage in that age range. Mhmm. Kids are not the driver of cost for Medicaid. Kids are a great deal. They represent you know, 50% of kids are on Medicaid or so, and they cost less than 10% of the overall Medicaid budget. So this was great, right? What we could do now is we need to make it really easy for families to reenroll. We need to automate reenrollment and connect it to other services that they get so that it can be sort of one click. We also need funding for community health centers, facilitated enrollers, community based organizations to be able to help families. With HR one, it wasn't targeted at kids, but as parents lose their eligibility, they often mistakenly think, my child has lost their eligibility too, and so it's another risk. These things would really help. Thank you for asking. Yeah. And thank you for your work to sponsor that. It was it was we were leading the nation. You know? We have more kid we have one out of fifteen kids in the nation, and we had zero to six continuous coverage. It was huge.

[Assembly Member Jessica González-Rojas]: J. Yeah. Yeah, I was very proud to get that over the finish line. Now it's heartbreaking to see it

[Senator Sean Ryan]: J. As if he said.

[Assembly Member Jessica González-Rojas]: J. You. Thank you.

[Speaker 0]: Senator Wright.

[Senator Sean Ryan]: Thank you, everybody, for your testimony. To Denise.

[Laura Castle]: Yes.

[Senator Sean Ryan]: Olivo, I want

[Speaker 51]: to Thank pass

[Speaker 7]: you.

[Senator Sean Ryan]: You mentioned in your testimony that there are administrative rules present within the myth which shift financial and operational risk onto families. Could you give us just specific examples of that?

[Denise Olivo]: Absolutely. So for example, when they when the MIF changes rules, they tend to change they're always changing the goalpost. Right? They're changing where and the family's not knowing. So for my example, my my son has twenty four hour care nurse nursing private duty nursing, and private therapist comes to the home and whatnot. And I also have private insurance, through my husband's employ employer. So with the nursing, my our private insurance does not cover private duty nursing. Actually, most private insurers don't. It's very rare. And the myth has been, covering this for for a while, and then they're asking me for a denial letter, which now the the my private insurance is not giving a denial, then for the insure for the vendor to get to register, to get a prior authorization, it takes six months, and the MIF is asking for these paperwork to come in within ninety days, which leads them out of the window. And it doesn't it makes absolutely no sense. No sense. So it's, that's just one example. There's plenty other examples where and and when these policy changes are happening, they're not informing the families. They're posting it. And then it's only when the representative from the MIF says, hey. This, you're you're getting denied. We don't even get denial letters. I have yet to see the denial letter of not my my son's nurse not getting covered, but I I the but my nurses aren't getting paid. And that's I was dealing with that while my son was in the hospital, and I'm still dealing with it. So it's it's awful, awful.

[Senator Sean Ryan]: J. I don't want to put that on you because it's obviously I can tell, but it's pretty frustrating. And would you mind terribly if I had I guess my question was going be about how we solve this or how can we rectify this. I only have thirty seconds left, my question is would you mind terribly if I had somebody on my staff reach out for some ideas how we can probably fix some of this?

[Denise Olivo]: I would be I would welcome a brainstorm session.

[Assembly Member Gary Pretlow]: Okay. Thank you. Assemblywoman Simon.

[Speaker 17]: Thank you. And thank you all for your testimony, particularly the parents. I have a couple of myth related questions. One is it's very clear, think, from your testimony, Mr. Braun, that you think that there are people who are under mif that could be excluded because they don't have as acute needs. But they may be lifelong needs and they may be relatively sporadic,

[Assembly Member Phara Souffrant Forrest]: but

[Speaker 17]: there's a need for them to be covered. I'm curious about your what your thinking was about that. So that's number one. And then for both of you, it seems to me that there's very little, if any, engagement with recipients in advance of a policy change that seems to not be grounded in kind of reality testing. And it seems to me that there are a bunch of assumptions underlying the changes. And so if you could comment on that, I'd appreciate it.

[Speaker 40]: J. So just with respect to the first question, yes. Think the

[Speaker 7]: needs to

[Speaker 13]: about J.

[Speaker 50]: Could you

[Assembly Member Karines Reyes]: turn your mic?

[Speaker 40]: Sorry. Just with respect to the first question, I think the MIF needs to think about enrollment criteria modification, meaning there are 30% of participants who don't really use the MIF. Don't use it at all, you mean? J. J. Correct. Virtually, like, under 25,000. Okay? That's the way the actuary report defines it. And that's for a long duration. Okay? My guess is that those individuals have they're not medically fragile. Okay? So their disabilities are more maybe Erb's palsy. So they're enrolled in the MIF, but they present actually a long term liability, meaning as they get older, the MIF might have to pick up different types of coverage for those individuals, like long term care coverage effectively.

[Speaker 17]: I see.

[Speaker 40]: So then that will take away from the medically fragile kids in the MIF who have a very significant neurological injury and really need it. Because the

[Speaker 0]: MIF

[Speaker 40]: operates as a global insurance effectively.

[Speaker 17]: J. Okay. And what about the engagement? It seems to me there seems to be none, but I don't want to assume. J.

[Denise Olivo]: Let me be clear. We do have case managers from the, the MIF. So you can call your case manager, but they don't they give you the rules and policy as they come up, but they're not really helping. They're just saying, basically, the MIF won't do that or you can't do that. So it so in that sense, I don't wanna take I mean, that that's that. As far as other parent other children being enrolled or not enrolled depending on their severity, I don't think that's really fair. Because all these children enrolled were

[Speaker 17]: Thank you. I appreciate your testimony. Thank you very much.

[Speaker 0]: J. Thank you. Thank you all very much. Mr. Braun, you've been helping my office and advising us for many years now. And the one thing you keep bringing up that we just can never get an answer from the state on, and I don't understand, is your recommendation that for people in MIF who don't have private insurance, but if the state paid for their private insurance, it would cost us, the state, far less money than having MIF pay 100 Do percent of you actually understand why the state doesn't understand that?

[Speaker 40]: J. No, I don't. I mean, in the actuarial report, when you look at paid benefits since inception of those without insurance, it's $441,000,000 versus with insurance, it's $90,000,000 So 50% of the enrollees do not have insurance. And then the MIF is effectively the primary insurance. I think there is a way to fund that. If you look at the number of enrollees in the MIF, 50%, that's 500 individuals. If you look at the balance that the MIF has, it has about $100,000,000 It doesn't really earn a lot of interest. It could buy T bills and basically fund the insurance purchase for those 500 individuals. I think it would probably cost around $5,000,000 And then they could realize the cost savings. And then we wouldn't be in this dialogue of always reducing reimbursement rates to make them financially viable. And again, I think the other thing I would touch on that I think is really critical is the funding source vis a vis the tax. We're always going to cut reimbursement rates, cut reimbursement rates, cut reimbursement rates. That can't be the answer because that just destroys the myth entirely. And there are a

[Assembly Member David Weprin]: lot of

[Speaker 40]: negatives from that beyond the fact that the kids can't get the care that they need.

[Speaker 0]: J. You. And for the Pediatric Society, so I'm biased because I have a brother-in-law and a niece who are both uber pediatricians. Pennsylvania, not New York. They're in total panic that we're gonna be destroying vaccinations for children throughout this country even though it didn't go rule wise as bad as it could have. But they're convinced people are going to just stop doing this. They're not going to actually listen to their doctors because they're being told different things by the federal government. How worried are you on behalf of our children here?

[Speaker 56]: I really am worried. I mean, what has happened is these things that were standards of science are now parents are hearing mixed messages and are confused, right? And so, Assembly Member Paulin, your legislation thank you. You know, if we could have legislation that supports the AAP recommended vaccine schedule, that would really help, because people would look to that. It could be put up in pediatricians' offices, and people would look at that and say, that's what we need to do. I'm sorry?

[Speaker 0]: I know, it's

[Speaker 67]: a

[Speaker 56]: little So, yes.

[Speaker 22]: Someone whippering? Oh, sorry.

[Speaker 0]: I didn't allowed you to a long eye. Sorry. It was my fault.

[Assembly Member Gary Pretlow]: That's cool.

[Assembly Member David Weprin]: Thank you, Mr. Chairman. I have a question for Doctor. Jakubovic from 16,000 physicians that are currently enrolled in the excess medical malpractice insurance program. Is that correct?

[Dr. David Jakubowicz]: That is correct.

[Assembly Member David Weprin]: And how would the governor's proposal about having them pay 50% of the cost of their policies affect the ability of physicians to receive affordable medical malpractice coverage?

[Dr. David Jakubowicz]: It would help them it would hurt them quite a bit. A lot of our physicians would either, as I said, elect to leave the state, elect to not get the excess and leaving them bare and potentially leaving even for, you know, routine care, potentially their house or their livelihood for whatever they did for just some civil matter. It really will make them make some very difficult decisions because some of them are going to be paying high 4 figures, some of them are going to be paying 5 figures in order to cover this. And again, we, as I pointed out, New York pays more in medical liability payouts than California and Florida put together, with a third the population. We live in a very tort heavy liability state, and it's going to make difficult decisions. I hear more and more physicians doing locum tenens, leaving the state, and it's only going to exacerbate accessibility issues for your constituents.

[Assembly Member David Weprin]: Okay. Do you see any dialogue with the Governor and her people on this issue?

[Dr. David Jakubowicz]: We, well, our lobbyists and us do have dialogue with the governor. There's a number of issues that we're working on at this point with the governor. Of course, with the help of the assembly and the senate, the legislature are quite there's three people or three entities in the room, and we're looking for your support, but we are reaching out to the governor's office as well.

[Assembly Member David Weprin]: Thank you.

[Dr. David Jakubowicz]: Thank you.

[Eric Linzer]: You. Do

[Speaker 0]: you have any other?

[Assembly Member Gary Pretlow]: No, I'm good.

[Speaker 0]: Okay. Thank

[Speaker 22]: you all very much

[Speaker 0]: for us today. We appreciate you. Thank you. All right. We are moving to panel F, the Council on Autism Service Providers and the Alliance of TBI NHTD Waiver Providers. Good. Still afternoon. Feels like evening, but still afternoon. All right. So, Marielle Fernandez from the Council of Autism Service Providers first.

[Speaker 63]: Good afternoon Chairperson, Senate, Assembly members, thank you for the opportunity to testify. My name is Mariel Fernandez. I'm Vice President of Government Affairs for Council of Autism Service Providers. CASP is a national nonprofit trade association representing autism service providers committed to delivering evidence based medically necessary care, including applied behavior analysis, or ABA. Our members serve individuals with autism nationwide, including thousands of children here in New York State. We are deeply concerned about the governor's proposed budget, specifically the planned $13,700,000 reduction to the Medicaid ABA benefit, and the second 12 and a half percent rate cut scheduled for 04/01/2026. While we appreciate the legislature's past efforts to prevent a devastating 50% rate cut to one on one ABA services, which would have made the New York rates the lowest in the entire country, the second 12.5% rate cut will still have significant consequences. A recent joint survey by CASP and the New York State Association for Behavior Analysis found that seventy four percent of Medicaid enrolled ABA providers may be forced to leave the network if the cut takes effect, significantly reducing access to medically necessary care for children across the state. New York Medicaid ABA rates are already amongst the lowest in the nation. And if this cut moves forward, one to one ABA will be significantly below the national average despite New York having one of the highest costs of living. This is also fiscal issue. Without effective early intervention, individuals with autism may incur lifetime costs exceeding $3,000,000 In contrast, early and intensive ABA has been shown to save an average of $2,800,000 per person over a lifetime with more than $200,000 per child in educational costs alone. Cutting access now will increase long term costs related to emergency care, psychiatric hospitalizations, and restrictive educational placements. We are also concerned about the proposal to establish a Center of Excellence designation as a new eligibility requirement for Medicaid ABA. We support improving diagnostic quality and expanding access as New York already faces long diagnostic wait times often lasting months or longer. Requiring diagnosis or prescriptions exclusively from a designated center of excellence, which do not currently exist, risks further delays in equities and potential compliance issues and it does not address utilization management, medical necessity, or quality oversight concerns already identified by the Department of Health. Our written testimony outlines specific questions to ensure the CV designation expands and does not restrict access. We respectfully ask you to reject the 12 and a half percent Medicaid rate reduction scheduled for April 1 and seek additional details and stakeholder input before advancing any Center of Excellence designation. Thank you for your time, your leadership, and your commitment to New York's children and families.

[Speaker 0]: Thank you. And next, the Alliance of TBI and HTD Waiver Providers, Tracy Allen, who will explain what those letters all mean.

[Tracy Allen]: I will. Thank you. You. Good afternoon. My name is Tracy Allen and I'm the Executive Director of the Alliance for TBI and NHTD Waiver Providers. The Alliance of TBI and NHTD Waiver Providers is a statewide organization consisting of traumatic brain injury and nursing home transition and diversion waiver providers and non waiver provider organizations committed to advancing our mission, which is to strengthen, unite, and advocate on behalf of the TBI and NHTD waiver providers to ensure the quality, cost effectiveness, and continuity of the TBI and NHTD waiver programs. Our mission ensures ongoing access to essential services for individuals participating in these programs, enabling them to maintain independence within their homes and communities. Today I'm speaking on behalf of the Alliance, the providers who serve the people in the program, and more than 11,000 New Yorkers with disabilities and older adults across the state. The nursing home transition and diversion waiver is a lifeline. It allows people who are eligible for nursing home care to remain safely in their own homes and their communities rather than nursing home placements. This program is not only the right thing to do, it's also cost effective. For nearly twenty years, the NHTD waiver has saved Medicaid millions of dollars while preserving dignity, independence, and choice. Given recent growth in the NHTD program, however, last year, the administration capped enrollment going forward. Today, we urge the legislature to act on two critical priorities. First, we ask you to permanently carve the NHTD waiver out of Medicaid managed care. The current exemption expires in January 2027. The state has already recognized the importance of this protection for the nearly identical TBI waiver. There's no evidence that managed care plans are equipped to meet the complex needs of the NHTD population and no comprehensive planning has been done to ensure continuity of care. Allowing this exemption to expire would put thousands of vulnerable New Yorkers at risk. Second, we urge you to support a thoughtful, data driven NHTD waiver reforms that address program growth while preserving access to care. Simply capping the program does not address the reasons for growth nor does it reform the program in a sustainable way. Recent enrollment increases reflect New York's rapidly aging population and the growing need for long term care. Individuals that need a higher level of care are turning to the waiver because it provides services that managed care cannot. The solution is stakeholder collaboration, transparency, and responsible oversight. We're grateful to the administration for initiating the processes, but we ask the legislator to act to include language in the budget to establish waitlists for the program to one, collect data to make informed choices about rational reforms and two, ensure people who are waiting have access. Please keep in mind that without access to the waiver, the need for services will not disappear, but the cost will simply shift to far more expensive and restrictive settings. Like all New Yorkers, the people we serve want to age in place. Thank you.

[Speaker 0]: Thank you both very much. Questions? Assembly?

[Assembly Member Gary Pretlow]: Yes. Assemblywoman Gonzalez Rojas.

[Assembly Member Jessica González-Rojas]: Thank you so much. This question is for Tracy. Can you outline again what the status of the nursing home diversion program is and what the recommended changes in the executive budget are just to underscore some of the solutions you presented?

[Tracy Allen]: Sure. There aren't any actual recommendations to do anything within the budget. There was language in the budget regarding the massive growth of the program Mhmm. Which the program is growing because the number of New Yorkers is growing.

[Speaker 59]: Yep.

[Tracy Allen]: So, you know, what has happened in the in the past years, the administration has put a cap on enrollment of 9,400. With that cap on enrollment, the issue is that people don't have anywhere to go to get the level of services that they need. So within that cap, there also is not an established waitlist. So the request to have a waitlist is to ensure that people that are being told, I'm sorry, there aren't any openings, a waitlist is being kept so those people are able to go on in the order that they've contacted as well as receive the services that they need.

[Assembly Member Jessica González-Rojas]: I just see a lot of alignment with what we're dealing with the CDPAT program where this is a successful program. So people are enrolling. And it's keeping our loved ones home in their environment that's comfortable with care that they need to live independently. And it's just very frustrating to see these very successful programs continually be attacked or undermined or diminished. In full transparency, my mother's in the nursing home diversion program. It's been a lifeline. I honestly don't know what I would do without it. Thank you for that. There's there's no, means to to get the care that she needs in the setting that she's most comfortable in. And I know there's thousands of families that also feel that way. So, we have to do everything to protect this program as well as others that provide very meaningful care that are more cost effective than sending them to a nursing home. So I just want to thank you for your work, thank you for clarifying where we're at and what are some of the recommendations.

[Tracy Allen]: Thank you. And we have met with you know, like as I said, the administration is working with us as a beginning part of to reform the waiver to make it more streamlined. So there's a lot of information there. So we really want to be able to continue to do that and have that move forward. Thank you so much for your input as well. Thank you.

[Speaker 0]: The hours get later, so the number of questions decrease. But thank you very much for being with us today.

[Assembly Member Phara Souffrant Forrest]: Thank you.

[Speaker 0]: Thank you. We're going to call up panel G, the New York State Health Facilities Association, Tara Quinlan, the Empire State Association of Assisted Living, Chris Vitale New York Caring Majority, Alana Berger and the Home Care Association of New York State, Al Cardillo. Okay. Thank you.

[Speaker 10]: Tag I am it for a little bit. So we'll start with the New York State Health Facilities Association, Tara Quinlan. Go ahead, ma'am.

[Tara Quinlan, RN]: Thank you for the opportunity to testify on behalf of the New York State Health Facilities Association. I am Tara Quinlan, registered nurse with over twenty years of experience in frontline care and Department of Health regulatory oversight. Today, I sit before you not just as a representative of NSHFA, but as a clinician who has seen firsthand happens when a health care system is pushed to its breaking point. We represent over three fifty skilled nursing facilities. From our smallest nonprofit homes to our largest proprietary and government sponsored centers, our members care for more than 60,000 New Yorkers every day. Our mission, to provide dignity and medical excellence to our seniors, is under direct threat from a legacy of systemic underfunding that has finally reached its breaking point. We are not here to ask for a favor. We are here to provide a road map for the survival of the sector. To protect our state's most vulnerable citizens, we respectfully request the following essential investments. While the executive budget proposes 1,500,000.0 in new health care funding, at least $750,000,000 all funds must be specifically earmarked for nursing homes. Nursing homes rely almost exclusively on Medicaid. It is the only way to sustain operations, recruit a dwindling workforce, and prevent the discharge gridlock that currently leaves hospital patients languishing in ERs because there are no available long term care beds. Second, new revenue generated from the nine month extension of the MCO tax, approximately $1,000,000,000 in new money, should be proportionately allocated to nursing homes, $289,000,000 all funds. The MCO tax serves as a vital bridge to stabilize nursing home finances while long term structural reforms are developed. Third, for years, our facilities have been forced to modernize on a shoestring budget due to a 15% cut in capital reimbursement. The budget's proposal to restore 10% is a start, but we urge the legislature to restore the remaining 5%. Safety is nonnegotiable, and these funds are the difference between a facility that can afford life safety upgrades and one that cannot. Every day this gap goes unaddressed, another wing closes, another specialized program is cut, and another family is told there is no room for their loved one. We are witnessing the intentional dismantling of the long term care safety net. When we look at this budget, we aren't just looking at numbers. We are looking at the lives of the people who cared for us in our youth and built the world we live in today. Leaving these three priorities out isn't just a financial decision. It's a choice to let go of the very hands that held our communities together. Please, let's choose to lead with our hearts and protect the people who once protected us. Thank you.

[Speaker 10]: -Thank you so much, Ms. Quinlan, Empire State Association of Assisted Living, Chris Vitale. VITALE:

[Chris Vitale]: Do I need to push a button here? CHRIS You're good. CHRIS No, Okay. You're on. Hello, CHRIS chairs, rankers, members of the Senate Assembly. Thank you for having me here today. My name is Chris Vitale. I'm here on behalf of the Empire State Association of Assisted Living or ESAL. ESAL represents more than three eighty licensed assisted living and adult homes across New York State that care for more than 38,000 frail seniors. Our members care for individuals who pay privately, but they also care for a lot of people who are on SSI and or Medicaid. I grew up working in this industry. I'm a former owner operator of quality Medicaid funded assisted living programs referred to as ELPPS for the past twenty seven years. And I've dedicated my entire career to this. I've seen a lot of changes, but what I'm most concerned about is what I see as the disproportionate neglect of our industry that's gone on for far too long that's really resulted in a crisis of closures across the state. You know, we've had more than 5,000 adult care facility bed closures in the last decade, even more in the last year or so. It's really a crisis. According to AARP, we now rank dead last in the nation for accessibility to assisted living in New York. So I'm here again. I'm here to beg the legislature to act, to support frail seniors in a way that's sustainable in a couple of ways. Number one, every year the governor proposes eliminating the Enhancing the Quality of Adult Living or Equal program along with the rich housing subsidy. These are both vital lifelines for low income frail seniors living in these communities. You restore it every year. We only ask that you do that once again. Number two, you may wonder why the Medicaid funded facilities across the state are closing their doors. I can tell you it's because providers today are caring for individuals in 2026 with a reimbursement rate from 1992, 34 old reimbursement rate. Since 2009, inflation is up more than 40 to care for these people, yet the reimbursement rate helps receive today is up less than 1% since 2009, not sustainable. While the executive budget includes 1,500,000,000.0 for hospitals and nursing homes, Some of that has to be set aside for skilled or assisted living communities. Number three, expand the special needs assisted living voucher program. This is a no brainer. It's a wonderful program that allows people who have Alzheimer's or dementia who are currently living in assisted living communities that have special needs, once they deplete their funds to apply for a stipend program to help offset the cost of care in that facility. It's funded at 7,750,000.00. We're asking you to fund it to 15,000,000. Lastly, support legislation to create a demonstration program to allow Medicaid funded health facilities to take care of people with dementia or Alzheimer's. It's going to save Medicaid dollars and it's going to allow people to age in what they perceive as their own home, their special needs assisted living facility. It'll clearly show a savings. I'm available for any questions you may have.

[Speaker 10]: Thank you, Vitale. Mr. Vitale.

[Assembly Member Gary Pretlow]: That's New

[Speaker 10]: York Caring Majority, Alana Berger.

[Speaker 31]: Hi everybody. Thank you so much for the opportunity to testify. My name's Alana Berger. I'm the director of New York Caring Majority, which is a grassroots organization of older and disabled New Yorkers, family caregivers, and home care workers, ensuring that everyone who needs home care can get it and that the people who do that important work are paid a living wage. A bigger summary I wanna share connected to everything people testified about today is that, New York faces one of the worst home care worker and other medical worker shortages in the in the nation. But instead of investing in care, New York State is handing billions of our Medicaid dollars to insurance companies and private equity companies who extract profits from our dollars instead of providing care and and paying care workers. At a time when we know we're facing huge federal cuts to Medicaid, we cannot afford to keep wasting billions on corporate middlemen. So our my written testimony and our work, you'll see us in the halls, really is about a broader care, not corruption campaign ensuring that Medicaid dollars are a public good. It includes the home care savings and reinvestment act to carve Medicaid funded home care out of managed care and save billions that we could invest in things like fair pay for home care. But today, what I really wanna focus on is CDPAP. And just my bottom line to you all from our membership is that we are asking you to protect your constituents who rely on CDPAP for home care and caregiving jobs to implement common sense measures in this budget to ensure the transparency and accountability for $11,000,000,000 of Medicaid money that the state is sending to private equity backed PPL. At the budget hearing today, at the hearing last year, at the Senate hearing in August, commissioner, DOH commissioner, Medicaid director avoided answering, offered half truths or untruths when asked for some basic information related to CDPAP. Nearly a year into this transition, there's one universe in which the commissioner and the CEO of PPL are posting op eds touting the success of this transition and the savings. On the other hand, there's the real perspective, which is the people on the ground. A year ago today, there was 280,000 consumers in CDPAP and, at minimum, 350,000 workers, we think more. Largely because of PPL's failed systems and their inability to pay people and their sham health insurance, at least 150,000 home care workers and 90,000 consumers have left the program. Yet today, rather than expressing concern about this or desire to figure out what's going on, the commissioner and Medicaid director completely ignored what's happening. The governor promised there would be a smooth transition where nobody would lose their care. She defended this move as a way to root out waste, fraud, and abuse. But without any oversight, we don't know if there's fraud or abuse. We've heard all different numbers about the savings in this program. We don't know what's true. The most simple thing to do is to ensure transparency and accountability. There's language in senate nine one four two that would require quarterly reporting publicly available by PPL that would allow us to actually know what's going on. Whatever your position on this transition to a single FI, we know we want to see oversight over this program.

[Speaker 10]: Thank you, Ms. Berger. Home Care Association of New York State, Al Cardillo.

[Al Cardillo]: Thank you very much chairs, rankers, and members of the committee. Thank you for the opportunity for the Home Care Association to present our views to you this evening. Our association has representation from all of the core parts of the home and community based system, home health agencies, licensed agencies, health plans, hospice programs, waiver programs, allied services and more. Tonight, really what the focus I'd like to give to you in the limited time that we have and is summarized in this one pager in our budget testimony, really focuses on the system as a system. In the last several years, perhaps going all the way back to the inception of the MRT, Medicaid Resign Team, you know, back in 2011, Home care has been looked at on an individual component basis in different venues, in different budgets, CDPAP, NHTD, wage improvement. But really there has been a complete loss of a core focus on home care as a system. That system plays a critical role in the entire health care system with hospitals as partners, physicians, nursing homes, aging services, etc. The consequences of that system being overlooked, even if we just use the example of the last several budgets where the governor has proposed hundreds of millions of dollars for other sectors, none for the home health sector. The the consequences of overlooking that are evident in this statistical representation. Every core part of our delivery system, certified agencies, licensed agencies, MLTCs, PACE, and hospices, 60% of them are operating with negative margins. Those statistics are from the certified cost reports to the state. 20% of home health agencies have closed in the last five years. It is a complete erosion of the system. But I want to talk to this not as what the Lixes need, what do CHAs need, what do plans need, what do workers need, but I implore you to look at this as a system. We have four key proposals that we would like you to consider in this budget. One is a structural fix in the rate structure from which a licensed agencies and MLTCs are paid by the state and then go on to have to cover the workers. The second relates to aid for certified home health agencies and hospice. There's a program that's been on the books for years and unfunded that is critical to maintaining those programs. The third area is workforce. Workforce is the backbone of the entire system. It is often overlooked in the executives proposals of the the budget and we implore you to include home and community based services in it. The last thing I would talk about is system accessibility. There are services that are not being used, that are not being tapped, including the NHTD that's limited, that are really vital to being able to maintain the structure of the system. Please support those services. We have language that we would like to give you that will advance that.

[Speaker 7]: Thank you.

[Speaker 10]: J. You, Mr. Cardillo. I'll kick off, if I may. And please keep the answers as tight as possible, because the time is very tight. I'll start with Ms. Berger. Said Alana, you said that there are 90,000 less consumers in the system. How did you get that number?

[Speaker 31]: I mean, that's a great question. We pieced lots of stuff together. Like, today in the Empire report. There was a lovely piece by the commissioner that said there's 200,000 currently 200,000 consumers that we know there were 280,000 a year ago. Also, though, today, the commissioner said we are coming up on 1,000,000,000 in savings, whereas the budget director said 1,200,000,000.0, and somebody else, the governor said, 2,000,000,000. So this is why we need oversight

[Speaker 10]: Yeah.

[Speaker 31]: Because they're just saying numbers. So we don't actually know.

[Speaker 10]: Yes. And we're on the same page, by the way. Like, I've I've said it publicly and privately to them many times. Yeah. I can say it's like me saying Salma Hayek is my girlfriend. It would be nice.

[Speaker 31]: But I think this is

[Assembly Member Khaleel M. Anderson]: But why that's

[Speaker 10]: we not necessarily true. Want the language

[Speaker 31]: in the budget that requires the reporting.

[Speaker 10]: Yes. So certainly, I just wanted to underline that because of the numbers that you're providing us. They're providing the numbers that they're providing us, there are some things that we consistently ask them, and they can provide no numbers. So they just said, trust us. I don't. I just want to say that publicly.

[Speaker 7]: I'm with you.

[Speaker 10]: Mr. Vitale, talked about two questions I have for you. You talked about rates. You talked about you referred to nineteen ninety two, and you referred to 2009. J. Yep. Was that correct? J. Yes. Tell me about those two years quickly, why you mentioned them.

[Chris Vitale]: J. So 1992 was the year the whole program began. Yes. So in 1992, the Public Health Law 3614 ties the reimbursement rates back to the cost of care in 1992.

[Assembly Member Phil Palmesano]: Got you.

[Chris Vitale]: So that's when the rate began. 2009 is when the rates stopped trending forward. And as a result of that, in April 2009, rates actually went down across the board by 7% because they took them By how much? By 7%.

[Speaker 10]: Got you.

[Chris Vitale]: It was 6.8%, something Yeah. Like And they didn't give that back until 2023. So providers in 2023 were made even with about what they were in 2009.

[Speaker 10]: J. Gotcha. And last question related to the MCO tax. We talked earlier about the fact that there was amounts that were set in last year's budget that we agreed upon and were voted on related to how it was going to break down. And there was a chunk of it, albeit small, but a chunk of it that was supposed to go to assisted living facilities. Has that money moved?

[Chris Vitale]: J. It has not.

[Speaker 10]: It has not.

[Chris Vitale]: Providers have not received the 4.16% they were promised from last Got

[Speaker 10]: have you spoken to the administration about that?

[Chris Vitale]: Yes, we've reached out to

[Speaker 10]: the What has been the response?

[Chris Vitale]: Was apparently it's in the cycle. It's about to happen. We've been waiting for that for months.

[Speaker 10]: Gotcha. You were at least told that you were going to get it?

[Chris Vitale]: We were told it's coming.

[Amir Bassiri]: As opposed

[Speaker 10]: to the FQHCs who were told you're just not getting it. Just I just want to make that distinction, yet you don't have That's right. Thank you for being here. Thank you for the work that you do every day to take care of the most vulnerable, Thank you.

[Assembly Member Gary Pretlow]: Thank you. Yes,

[Assembly Member Josh Jensen]: thank you, Mr. Chairman. Mr. Cardillo, the executive budget would limit reimbursable administrative and general costs for home agencies to 15%. But has the Division of Budget or the Governor's Office provided any explanations about accounting for spends that are in the A and G category?

[Al Cardillo]: No. To and and not not at least at this point. Assemblyman, I can speak to that in in detail. The the the origin the a and g. The legislature codified A and G for certified home health agencies and long term home health care programs in 1993. Ten years later they lifted, they added that also to licensed home care agencies. The A and G is calculated. The calculation is basically the statewide average A and G is applied to agencies in the establishment of a rate. The costs that go into A and G are very frequently case management related expenses. So that, for example, we just had terrible weather, below zero temperatures. The time that nurses and social workers and staff would spend to try to address the needs of people in their homes, in the cold, there's no separate bill for that. It's just called administrative and general expense. Home care agencies that work with hospitals to transition patients to the community, A and G. So the issue is with that cap, we have no idea really how the cap would be applied and what potential deleterious effects it would have in the system. One last point if you permit me. Right now in the negotiated world, there is no there is no recognized support for what the a and g even is to an agency. The statute protects the wage, which it should, but it offers no no recognition to the operating component of what has to be in place for a patient and to support the worker. So I know that the budget proposal is related to a fee for service rate. However, there's also reference that it would be the standard. Our concern is something that already isn't recognizing costs is going to be capped even further. I'd be happy to share the historical legislative picture on this if the members need it.

[Assembly Member Josh Jensen]: J. So in about twenty three seconds, Mr. Vitale and Ms. Quinlan, could you share the importance of equal program, enriched housing subsidy, and the special needs assisted living residents vouchers for the members that belong to both your organizations or one

[Chris Vitale]: Speaking of for myself, as a former provider, I participated in that program every year. The money was dictated by the residents. I sat down with my resident council. They told me how they wanted the money spent, new furniture, new fixtures, making the building look good, make it feel good, make it their home.

[Eric Linzer]: Thank you. Thank you.

[Speaker 0]: Thank you. Senator Ryan.

[Senator Sean Ryan]: Mr. Vitale, how are you?

[Chris Vitale]: Good. How are you, You

[Senator Sean Ryan]: said correct me if I'm wrong. I don't want to misspeak. You said according to AARP, New York is last, fiftieth.

[Chris Vitale]: That's right.

[Senator Sean Ryan]: In regards to access to assisted living.

[Senator Joseph A. Griffo]: Is that correct?

[Chris Vitale]: That's correct. That means there's less assisted living beds per capita for people over age 75 than anywhere else in United States. We have the least amount of assisted living supply in the country for the people we have living here.

[Senator Sean Ryan]: And unfortunately, it's trending in the wrong direction

[Assembly Member David Weprin]: That's right.

[Senator Sean Ryan]: Because to Cardillo's, every new facilities are closing often.

[Chris Vitale]: Yes. We had more than seven sixty bed closures in the last year alone.

[Speaker 10]: You know

[Senator Sean Ryan]: how many were upstate versus downstate?

[Chris Vitale]: Well, I can tell you Monroe County had almost 400 bed closures this past year. So I don't know exactly where they are across the entire state. But I did a tour with Assembly Member Lunsford at a facility in Rochester and we talked about it this past summer.

[Senator Sean Ryan]: So I think we could probably classify this as a crisis situation.

[Chris Vitale]: J. Absolutely.

[Senator Sean Ryan]: How close are we to it becoming a public health emergency?

[Chris Vitale]: J. I think we're there. I think we're there. The reason hospitals get backed up is because those places don't often exist in the communities for them to be discharged to. There's less choice for people now. Right. And not to mention assisted living, Medicaid funded assisted living, in my opinion and this is through data is the most cost effective form of long term care that exists. We're less than a third of the cost of a skilled nursing home. We're less than half or I'm sorry, less than half the cost of a skilled nursing home, less than a third of the cost of twenty four hour home care. And a well run facility can do a great job at caring for individuals. I ran them for twenty seven years. I loved it. I loved the idea of taking someone who's out in the community failing to thrive in their own home, bringing them into my beautiful assisted living community, wrapping them with services and watching them thrive. But providers don't have the resources necessary to do that now. It is a crisis. It's why I'm not in the business anymore. And now I'm advocating for them instead.

[Amir Bassiri]: J. Okay.

[Senator Sean Ryan]: Thank you.

[Speaker 7]: J. J.

[Speaker 0]: Thank you. Assembly.

[Assembly Member Gary Pretlow]: J. Assemblywoman Gonzalez Rojas.

[Assembly Member Jessica González-Rojas]: There we go. Thank you. This question is for Alana. This morning when the Commissioner and the Medicaid Director were here, I asked about the enrollment numbers in the or actually a colleague asked about the enrollment numbers in the CDPAP program. It differed from the two numbers you gave, which you said 280,000 and then 200,000 in an article this morning. They said 220,000 I believe. So, I and they weren't clear about the savings as well. So, what are the main questions that remain in terms of the transition to PPL? This is something that many of us resisted, have tried to hold the administration accountable to and try to get answers in which we're sort of up against the same challenge you have experienced.

[Speaker 31]: Yeah. I mean, it's basic utilization and enrollment numbers. We wanna know where the money's going. We wanna know money that was designated for care. Is it going to care? Is it going to some private equity investor? We wanna know you know, we heard that we understood that PPL had to be paid up front by the managed care organizations, which was an unusual arrangement. Was there a reconciliation? What has happened? Be particularly because so many workers have fled the program. What has happened? Are there excess funds? I think it's any basic reporting that you'd want of an $11,000,000,000 contract. At the moment, it feels like the state said, here's $11,000,000,000. Do your best. Mhmm. The the contract that we finally were able to access was so heavily redacted. There's no concept of are there any performance metrics? Are there penalties? I know that people have tried to find out, are there full time employees at DOH that are actually overseeing this contract? We don't know. So I think it is really the basic numbers that anyone would expect to want to know from an $11,000,000,000 contract to an entity that has never done business in the state before or never run a program like CDPAP and has resulted in so many people leaving the program, in massive wage theft lawsuits, in, you know, contracting with we wanted to know information about their contract with Leading Edge. Mhmm. So about subcontractors that the that the statewide FI might be engaging with. Where is that money going? Were were money from the wage parity dollars that were sent to this these Emmy these cards, these flex cards that didn't get spent? Did that money go back to workers? Did it go to PPL or to leading edge? So I think it's just basic accounting.

[Assembly Member Jessica González-Rojas]: Yeah. I'm proud to be the assembly sponsor of the transparency bill. So hopefully, it'll pass, and we'll get some answers. I also wanna acknowledge that I I don't think we have any changes in the executive budget. So can you confirm that there's no there's no, language in the executive proposed budget that would address some of the concerns you raised?

[Speaker 31]: There's not. And I think the one other thing that's missing that we would very much like to see is change of language so that some of the vetted community based fiscal intermediaries from before, particularly independent living centers, could reopen to provide a safety net.

[Assembly Member Jessica González-Rojas]: Thank you.

[Speaker 0]: Thank you. Senators? Nope. Assembly, continue. No? No. All right. Then we want to thank you all very much for your participation today, and appreciate your more detailed testimony that we did not get completely to. Thank you.

[Chris Vitale]: Thank you.

[Speaker 0]: All right. Right. So our next panel is panel H, The Alliance for a Hunger Free New York, Natasha, Natasha Purnika, Feeding New York State, Kathleen Stress, and City Harvest, Jerome Nathaniel.

[Assembly Member Gary Pretlow]: Oops. That's okay.

[Speaker 0]: Okay. I think it's evening once it hits 05:00. Right?

[Assembly Member Gary Pretlow]: It is.

[Speaker 0]: Yes. It is. I know. We haven't seen light in a while. Anyway, why don't we go down the list in the order I just gave it to you in? So Alliance for a Hunger Free New York first. Hi.

[Speaker 66]: Hi. Thank you for having me. Good evening. My name is Natasha Pernica. I'm Executive Director of the Alliance for a Hunger Free New York, coalition of frontline food pantries and community based food providers, and the founder of the New York State Food as Medicine Coalition, which is advancing the integration of nutrition into our healthcare system.

[Natasha Pernica]: I'm here because nutrition is foundational to health. In this great state of New York, who deserves to eat? Having consistent access to nutritious food supports disease prevention, recovery, immune health, child development, mental well-being, and overall quality of life. Yet New York is facing a sustained food insecurity crisis. According to most recent data, fourteen percent of New Yorkers or one in seven are food insecure, higher than our national average. Recently, a mother of two shared that she had been up all night crying, trying to figure out how to feed her family. She hadn't eaten dinner. The only place she could turn to for help was a food pantry. In addition to families and working people, we are seeing an increase in seniors seeking food from pantries. During the November SNAP delay, an older adult who normally receives two home delivered grocery packages a month called to say they were thankful, but they wanted to make sure that everyone had access to food and were willing to give up one of their monthly deliveries so someone else could eat. Food inflation in New York has risen 39 since 2019, placing enormous strain on families and on the food pantries serving them in the community. More New Yorkers are turning to food pantries because there's nowhere else to go. Through our New York State Food Connect map, we received over a 170,000 inquiries in the past year alone, which was an 86% increase from the year before. In the capital region, one in eight residents visits a food pantry, a 42% increase from 23 to 24 with continued increases this year on top of last. This is not a short term emergency.

[Speaker 66]: We are asking you to bolster two critical programs, Hunger Prevention Nutrition Assistance Program at 75,000,000, Nourish New York at 75,000,000, and we are close, but we need to get to the finish line. These investments allow food pantries to operate beyond get what you get handouts and instead provide food aligned with dietary guidelines, protein, dairy, fruits, and vegetables, and grains, and provide direct support to direct providers. These programs form the base of the food as medicine pyramid. Without nutrition security, the rest of our health interventions won't be as successful. As SNAP benefits face reductions and disruptions, pressure grows. During SNAP delay last fall, 90% of pantries surveyed across the state reported increased demand with an average increase of nearly 57%. Please support our local pantries. Thank you.

[Speaker 0]: Sorry. Next up, Feeding New York State, Kathleen Stress.

[Speaker 13]: Hello, and thank you for the opportunity to speak today. My name is actually Alyssa Harry Nannon, and I'm speaking on behalf of Kathleen Stress today. And I'm the advocacy manager at Feeding New York State, the statewide association of New York's 10 food banks. Our food bank network serves all 62 counties across the state by working in partnership with about 3,000 community based organizations, including pantries, shelters, and the like. Last fiscal year, our food bank supplied over 425,000,000 meals. This was made possible through the direct support for programs like the Hunger Prevention and Nutrition Assistance Program, or HipNap, and Nourish New York, which is why we are asking to fund both programs at $75,000,000 each. HipNap and Nourish New York allow our network to purchase and distribute high quality, nutritious, and culturally relevant food to our communities. These programs provide healthy guidelines to ensure food is wholesome and healthy. And Nourish New York directly supports New York State agriculture, supporting over 4,000 New York based farmers, vendors, and producers since its inception. A recent Feeding New York State survey showed that 90% of our network's food providers rely on HipNap and Nourish New York to provide most of the food to their communities. Some quotes from that survey say that, one, both programs support our mission of serving seniors in need. Another said, if it was not for these two programs, we would struggle to purchase other foods. And lastly, one says, they allow us to go beyond just quote, unquote, feeding the hungry. They help us feed our community well. Not only that, it allows us to build relationships with each family where they trust us. They depend on us to provide food for their families. HipNap and Nourish New York allow our network to serve as a backstop as families work to make ends meet. But at its current funding level, HipNap and Nourish amount to only $40 per food insecure person per year. Investing in these programs will help amplify the effectiveness of the work we do. And the need to do this work continues. Demand remains over 70% higher than pre pandemic levels and continues to rise year over year. That need will continue to grow amidst federal cuts to SNAP and other public safety net programs. And it's also been paired with the termination of federal programs like the local food purchase assistance program, meaning we have less funding to support the growing demand. That's why we're asking for each to be funded at 75,000,000. We also recognize and support other complementary programs like SNAP, WIC, and NOEP that are also critical in helping to eradicate hunger in New York. Thank you.

[Speaker 0]: J. And our next testifier is Jerome Nathaniel from City Harvest.

[Speaker 1]: Great. Thank you. Thank you for having me here today to testify on the governor's executive budget. My name is Jerome Nathaniel. I'm director of policy and government relations at City Harvest, which is New York City's largest and longest operating food rescue organization. I start off my testimony with one big bad number that came from the one big beautiful bill. That's 409,000,000. 409,000,000 males are at risk of being lost across New York State because of $186,000,000,000 in cuts to the SNAP program. That's very daunting, especially for emergency food providers because we know that when SNAP falls short or when families are not eligible for SNAP, they go to food banks and food pantries to fill that gap. And to paint a bit of a picture about what's happening at food banks right now, in New York City, we are seeing 87% more visits this year than we saw in pre pandemic years of two thousand nineteen. That's 25,000,000 more New Yorkers, including veterans, households with children, youth aging out of foster care, homeless individuals that are now turning to food banks to make up that gap. And food banks cannot do it alone because for every meal that SNAP provides, food banks or for every meal that's that a food bank provides, SNAP provides access to nine meals. So the federal government has stepped back, so now it's time for New York State to step up. And in our written testimony, we are all aligned here asking for increases in the North New York program to 75,000,000, as well as the hunger prevention nutrition assistance program to 75,000,000. Both programs combined at 150,000,000 only amounts to about $50 per food insecure person. It's a very modest ask to offset all the future costs that might be related to our children as they're developing as well as hardworking parents and adults that are trying to balance the cost of food, but housing and childcare as well. We are also asking for investments in the SNAP program that were directly impacted by h r one or the one big beautiful bill. That includes funding for SNAP education. It was entirely cut through h r one. That's $30,000,000 that was allowing people to access education that taught them how to stretch their SNAP dollars. And this is an environment where there's a rising cost of food. There is also cuts to SNAP Outreach and the nutrition outreach and education program. We are asking the state to make that program whole at $8,500,000. That cost is coming because the federal government went from splitting the cost with states from 50 to 50% for SNAP administrative costs to now states having to pay for 75, percent of the SNAP administrative costs. So these are new expenses for really important programs that are even more important today than they were before because more families are going to food banks, more families are going to food pantries, and it'll be even more important to have a professional that can help you navigate the SNAP system as there are more rules and more changes to the program that put the state at greater risk of having errors if there isn't an expert to help them navigate that system. Thank you.

[Bea Grause]: J. You very much.

[Speaker 0]: Sorry. Senators? Senator Rivera.

[Speaker 10]: Good afternoon, folks. Thank you for hanging out with us for this long. I'm not sure if you folks are familiar with S9033. I just introduced it. It's a bill called Snap for All, which would create a state funded program to provide at least some food assistance for folks who are no longer eligible because of changes at the federal level. Not sure if you're familiar with it and if you wanted to comment. This is for anybody on the panel.

[Speaker 1]: Yeah. We we, certainly support all interventions that, create more, of a strong nutrition safety net, and we know that there's gonna be less support coming from the federal government. So we think it's critically important that the state exhaust all options. And I think that's also an incredible opportunity to support families that may be losing eligibility or may have not been eligible for SNAP.

[Speaker 13]: Absolutely. And if I may add, Feeding New York State is part of the SNAP for All coalition. And so specifically talking about some of those cuts at the federal level, we know that there are two really crucial main groups that we want to be focusing on. So there are those that just had cuts from HR1. So that includes refugees, asylees, people that are doing their best to get their citizens hip status. And not having SNAP as a result of that to help make themselves whole is a really big issue. And then on the state side, we know that the governor put together CPRAC, which is the Child Poverty Reduction Advisory Council. And that aims to help decrease child poverty in half by 2031. And as part of those recommendations, she or that task force said that we should provide food benefits for non citizen households with children as well. So those are the real two main groups that we're targeting this year. But we know that immigration is such a big issue now, and it always has been in this country. And that's why SNAP for All is such a crucial program. So thank you, Senator Rivera.

[Speaker 10]: Ms. Bernica, anything to add?

[Caitlin J. Azar]: Yeah, thank you.

[Speaker 66]: The alliance is in support of SNAP for All as well. Thank you.

[Speaker 10]: Thank you, Madam Chair. Assembly.

[Assembly Member Gary Pretlow]: Assemblywoman Paulin.

[Assembly Member Amy Paulin]: Just a quick question. We heard earlier that there's money problems in terms of getting out the door. Have you experienced with the agencies that you work with, that same experience with the health department? And if so, what does that look like? And what impact does it have?

[Speaker 66]: As far as contracting dollars? Yeah. Yeah. There is there are delays, reporting three to six months, sometimes more. There are delays, sure.

[Caitlin J. Azar]: You guys wanna speak more to that?

[Speaker 1]: There there have been delays, but I I do think it's also important to note that in response to the government shutdown, I saw the state activate quickly in ways that we hadn't experienced before in moving dollars. So the infrastructure is there. When the will is there, we saw the money move very quickly to program. So I think whatever was practiced, then it would be great to sort of model that same sort of urgency.

[Assembly Member Amy Paulin]: Thank you.

[Speaker 66]: You know, I could note that we still have organizations that haven't received the 65,000,000 additional funding in response to the SNAP delay in November. So obviously, they had to foot the bill and are waiting for that to hit them.

[Speaker 50]: Any other questions?

[Assembly Member Gary Pretlow]: I have more, but

[Speaker 0]: Well, know I was going to jump to Senate. Just

[Assembly Member Gary Pretlow]: want Thank to

[Speaker 0]: you. I wasn't sure whether Amy had other questions.

[Assembly Member Amy Paulin]: No, I'm done.

[Speaker 0]: Fine. Okay, thank you.

[Speaker 66]: All

[Speaker 0]: right, so we have a lot of things to blame the federal government for when it comes to the cuts in SNAP and the loss of benefit eligibility for a variety of people. But I've also been being told that the counties have actually really fallen off even before the last year in moving expedited SNAP applications, which are supposed to be available to people within, I think, a seven day timeline instead of a thirty to forty five day timeline. And I'm wondering whether you had already been seeing those problems at the sites you work with to help get food.

[Speaker 66]: I don't have anything on that.

[Speaker 13]: I'll I'll just start by saying just like from things that I've heard across our network, yes, sometimes there are delays. I believe, and I could be wrong in saying this, but that sometimes delays are up to ninety days that people are waiting. I've heard issues with folks, you know, having to wait on the phone for hours or, like, getting hung hung up on. So I think that there are definitely issues that need to be addressed administratively at all levels for sure.

[Speaker 0]: Okay. And I know you're both New York City. Right?

[Speaker 13]: I'm the statewide organization.

[Speaker 0]: Statewide. You're all the the large food banks. And you're at Second Harvest, which is

[Speaker 1]: J. We're a food bank in New J. York Right.

[Assembly Member Phara Souffrant Forrest]: Yeah.

[Speaker 0]: J. You're outside the city?

[Speaker 66]: I work with food pantries and other community based organizations in 35 counties and food as medicine stakeholders across the entire state.

[Speaker 0]: And so are you seeing those problems in the other counties as well?

[Speaker 66]: As far as delays in people yeah. I mean, yes. There's always delays in that. So people do turn to the charitable feeding system while they're waiting.

[Speaker 0]: Exactly. Okay. So, I mean, we have work to do here as well as the questions of how much we can make up for what the feds are doing, which is pretty serious.

[Speaker 66]: It is a point, though, that there are a lot of people that are struggling with food insecurity that aren't eligible for SNAP. They might make $10 a month too much for SNAP. And that is where we are seeing more and more people turning to food pantries, like seniors that have fixed incomes that have never had to turn to a pantry before. We're also seeing families that have two parents working turning to food pantries where they've never had to turn to pantries before. And you can see it in all our statistics. Like, it is, the growing need for food pantry support across the entire state is up seventy, eighty, forty, fifty. It's across the entire state. More and more people have nowhere else to turn because all of the other resources have been exhausted.

[Speaker 1]: Yeah. And to the point about working adults in New York City, 67% of the pantry participants have a working adult in the household. That's actually three times higher than it was before COVID. So there are more working adults that are going to pantry programs now.

[Speaker 0]: And it's true that we talk a lot about what we've done for children through our universal school meals programs for breakfast and lunch statewide and how important that's been. But we also have senior centers statewide that we need to make sure people know that they can go to as long as they're above a certain age. No paperwork, no proof of anything you can eat. So, yeah, we have a lot of work to do.

[Assembly Member Gary Pretlow]: Assemblywoman So Gonzalez Rojas.

[Assembly Member Jessica González-Rojas]: J. Thank you. Thank you for all your work. We've been in deep partnership on a lot of these issues. And I appreciate your support for SNAP for all. I carry that with senator Rivera in the assembly. Does can anyone have an estimate of the number of people that were removed from the SNAP program given the refugee asylees and those that were excluded? And what is the estimate of people that are gonna lose access to SNAP given some of the work requirements?

[Speaker 1]: I could jump in. So for refugees, asylees, and victims of of trafficking, the estimates that we saw initially as soon as h o one came out was 41,000 individuals across New York State, and that's because they may have some other sort of immigration status within their household that will allow them to maintain eligibility. Of course, the concern is that there's always the chilling effect, so there are families that may disenroll out of confusion and all the complexities with citizenship. So 41,000 is the number, but we know they can, be much higher. And similarly with, the able-bodied adults without dependent expansions, the initial number was 300,000, and that should start happening in March, but there's sort of, like, a a process of when recertification is happening and so on and so forth. So those numbers are happening over a course of time as people recertify.

[Assembly Member Jessica González-Rojas]: And I know they asked for covering that population of refugees, asylum, and survivors of trafficking plus parents of children who would otherwise be eligible is $244,000,000 which sounds like a big amount. But again, this is an investment in food and health and wellness. So I just want to thank you for that. To the point around, the increased numbers of folks who are showing up for the pantries, and food banks, can you identify how many of those folks have lost access to SNAP or are at risk of losing access to SNAP?

[Speaker 66]: The best information I have on that, because not all pantries ask if people have SNAP or have lost it, But we could see it in our numbers when the SNAP the SNAP delay happened where pantries were experiencing a 5056% increase in service during that time. But I don't know if you have any different data as far as, Snap impacting service levels directly.

[Speaker 1]: I think for us, it's a little early to tell on data and trends because a lot of some of these changes haven't quite happened yet. Mhmm. But we are continuing to do surveys through text and and, directly with pantry leaders to collect and see if there's trends, but we'll definitely be looking for that.

[Assembly Member Jessica González-Rojas]: Great. And I just with the last fourteen seconds, I just wanna acknowledge that the governor did finally put in the money to address the snap skimming issue in terms of upgrading the EBT card to a chip enabled card. So that's very promising, and we look forward to that rollout soon.

[Speaker 0]: Thank you.

[Speaker 13]: Us as well.

[Speaker 0]: Okay. Senators? Okay. Back to you, Assembly.

[Assembly Member Gary Pretlow]: We're done.

[Speaker 0]: Okay. Ben, thank you very much for your testimony here today and for the work you're doing all over the state. It's really crucial. Thank you.

[Speaker 13]: Thank you.

[Speaker 0]: And over forty years ago, I started the What New York name? Oh. Oh, excuse me, Senator Claire. I didn't see you. Senator Cordell Claire. Alright. Thank

[Speaker 16]: you. Thank you so much. You know, I know I I just came in on the in a tail end of what you were talking about, but I'm really concerned about seniors, older New Yorkers in need of food. If if you can share any trends that you're seeing

[Speaker 50]: Okay.

[Speaker 16]: Related to our seniors that are in need of food.

[Speaker 66]: I can tell you we just I just received our stats here in the Capital Region of 75 food pantries. And I don't have the exact number, but I could follow-up the demographic. The group that had the largest increase last year from 25 24 to 25 was the older adult population here in the Capital Region. But I can follow-up with actual statistics. Just got it today.

[Speaker 16]: And is go ahead.

[Speaker 13]: Thank you. I was just gonna add that when we think about SNAP as well and the SNAP minimum benefit federally, you can receive as little as $24 a month, really just not enough. And populations that that affects includes many of whom who are seniors and folks with a disability as well. So I just want to flag that that's another crucial thing we have to think about when we talk about SNAP and who's coming to our food banks and pantries.

[Speaker 16]: And you don't have to give it to me today, but if you have many numbers to, support seniors and the disabled who are not qualifying for SNAP and now relying on food pantries, I'd like to have that information.

[Speaker 66]: We did a survey of home delivered pantry groceries, and one of the things we'd like to see change in the Hunger Prevention Nutrition Assistance Program is to support home delivered pantry groceries, especially for that population. And I have a survey that I can share with you about that.

[Speaker 16]: Thank you.

[Speaker 0]: Just we saying close sorry. Over forty years ago, I started the New York City Food Bank. It was supposed to be a short term emergency situation. Didn't go that well. So anyway, so thank you all for your work.

[Speaker 66]: Thank you so much.

[Speaker 0]: Okay. Panel I, American Cancer Society Cancer Action Network, Hospice and Palliative Care Association of New York State, Housing Works, Community Pharmacy Association of New York State. Okay. Good evening, everyone. Let's just go down the order that you were on the agenda. So we'll start with Michael DiVoli, American Cancer Society. Then Jean Chrico, Hospice and Palliative Care Association. Then Virginia Schubert, Housing Works. And then Michael Duteau, Community Pharmacy Association. Okay. Hello.

[Speaker 56]: There we go.

[Michael Davoli]: There we go. Good evening. Thank you all so much for the opportunity to testify today. I'm gonna focus my testimony on one primary issue, and that is the issue of biomarker testing. Two and a half years ago, this legislature passed nearly unanimously. There was one lone lawmaker that voted against this legislation that brought biomarker testing to all New Yorkers through private insurance, through Medicaid, and for the first time ever was opening the doors to precision medicine. Biomarker testing is absolutely critical. It is modern day medicine at its best. It allows people to get the right treatment that they need for their cancer and other diseases at the right time. Unfortunately, the governor's budget proposes to roll back Medicaid coverage access to biomarker testing. This proposal is a short sighted effort to save money that will ultimately cost lives in the long run and waste taxpayer dollars in the long term through wasteful healthcare spending. What this legislation would do, or what this proposal would do, is roll back all of the coverage criteria for Medicaid patients, but not touch private insurance. That inequity is exactly what we were trying to get rid of when we passed this law in the first place. Earlier this morning, or ways ago this morning, the Commissioner of Health talked about their concerns around the biomarker law. And they specifically mentioned the peer review language in the law. That very language was not in the bill that this legislature passed. That very language that the commissioner raised concerns about today was what the governor's office insisted be put in the bill as part of a chapter amendment to strengthen the bill in their eyes. So advocates, more than a 100 different organizations across the state today, released a letter to the legislature asking for this language to be rejected from the budget. But we are ready and willing to work with the legislature to address concerns that the commissioner has, that the Medicaid office has, to ensure that patients get access to the best treatment, and get access to biomarker testing, while also ensuring we are doing right by taxpayers. I want to just close by saying this. Earlier today, I was joined with I was joined by over 12 different cancer survivors, Medicaid patients, private plans, who are all alive today because of biomarker testing. A budget is about values. Our budget must send a strong message that we value people's lives. Medicaid patients are just as important as those on private insurance.

[Speaker 0]: Thank you very much. Next we have Jean Chirico, Hospice and Palliative Care Association.

[Speaker 21]: Yes. Thank you chairs and distinguished members of the committee. I appreciate the opportunity to testify this evening. My name is Jean Chirico. I'm the President and CEO of the Hospice and Palliative Care Association of New York State. And I also want to thank those of you here today who have been vocal hospice champions for us over the years. We appreciate your support. But unfortunately, once again, this year's executive budget fails to address the unique and urgent issues facing New York State's hospice industry. So today I am here to urge you to support and include the hospice care initiative in both one house budget bills to fully fund and enact this initiative in the final budget and to take affirmative steps to ensure the integrity of hospice care in New York State. The state supports patient autonomy and showed that they support patient choice by passing medical aid in dying. But we believe the MAID policy is incomplete if it is not accompanied by hospice and palliative care education, funding and systemic integration. If you are never told that you have options for your care during the course of your illness journey, how is that choice? If someone finally asks you what type of care you want or where you want to receive it, but you only have days to live, is that really a choice? We tell people they can choose hospice wherever they are, but then your nursing home refuses to let hospice in. How is that choice? We spend billions to ensure New York maintains a health system that can provide the most aggressive and most expensive treatments but have spent virtually nothing on ensuring hospice and palliative care are a real choice in the healthcare continuum. Our association has provided a roadmap on how to ensure real choice is available to New Yorkers. The Hospice Care Initiative is a coordinated five bill legislative package designed to modernize New York's serious illness and end of life care framework. It strengthens the workforce, improves hospital hospice coordination, expands advanced care planning, removes statutory barriers, and enhances system accountabilities. And it represents a mere modest $31,000,000 HCRA eligible investment. We can't stand to hear that New York has the lowest hospice utilization rate in the nation, which is not due to a lack of providers and is not due to their inability to serve the need, but because of systemic barriers in our delivery system. That is also why we need to protect New York's certificate of need framework. Thank you.

[Speaker 0]: Thank you very much. Virginia Schubert, Housing Works.

[Virginia Shubert]: Thank you for this opportunity to testify on behalf of Housing Works. We're a nonprofit that provides a range of integrated care to over 15,000 low income New Yorkers a year. And I'm proud to have been a co founder in 1990. I'll refer you to our rather long testimony for all of our concerns and recommendations regarding the budget. What I want to use my time with you today for is to ask for the legislators' leadership to advance our plan to end the epidemic, the HIV epidemic in New York. Housing Works and the End AIDS New York Community Coalition were deeply disappointed that once again Governor Hochul did not even mention the HIV epidemic in her state of the state or budget book and made no new investments to advance it. We need your leadership, especially at a time of unprecedented federal attacks on the public health infrastructure, the HIV response, and members of the LGBTQ community. We've made significant progress in our plan towards ending the epidemic goals, but the epidemic still has a disproportionate and unfair impact on black and Hispanic New Yorkers who represented seventy eight percent of new infections in 2024. And most alarmingly, we've seen three years of increases in new HIV infections after years of decline. I want to lift up one area where we really need the leadership of the legislature and that is to make finally make a public assistance program of HIV rental assistance available statewide. It's a program that's only available to people with HIV who live in New York City. Now, why am I talking about public assistance before the health committee? Because housing is healthcare for people with HIV. People with HIV who lack stable housing are less likely to be retained in care. They're less likely to be virally suppressed. They're more likely to transmit to others and they die early. Now, only New York City makes this statewide program available to people with HIV in a meaningful way because local social service districts outside New York City simply don't have the resources to pay the 71% share. We're very grateful to Senator April Baskin and Assembly Member Bronson for advancing changes to the executive budget which are attached to my testimony that would make this physically possible for local districts outside New York City by having the state reimburse 100% of this public assistance cost. Now significantly, this does not require a new appropriation because the additional spend could be handled in the public assistance budget. Thank you.

[Speaker 59]: Sorry.

[Speaker 0]: Thank you very much. And Michael Duteau, Community Pharmacy Association.

[Michael Duteau, RPh]: Committee chairs, distinguished members of the committees. I am Mike Duteau. I'm a pharmacist. I am president of the Community Pharmacy Association of New York State. I'd like to thank you for your strong support of local community pharmacies, as well as the ability to testify today. First and foremost, regarding the Budget, protecting and expanding access to immunizations is a priority for our organization. The Budget includes a proposal to authorize medical assistance to administer immunizations. Consistent with this proposal, we support bills by Senator Acunae and Assembly Member Souffrant that would actually codify the ability of registered pharmacy technicians to administer vaccinations under the direct supervision of pharmacists. Since 2020, pharmacy technicians have been able to administer vaccinations in New York under the Federal PrEP Act. It's been an important part of our access to care initiatives, and candidly during the pandemic and during high periods of demand has been critically important to all communities, especially those in rural areas. Notably, every other state except New York, Texas, and Mississippi has taken action to codify the ability of pharmacy techs to assist with immunizations. Given its importance and urgency, we ask that the measures be added to the One House Bills and the final budget. Next, expand access to point of care testing and treatment. The budget also includes a proposal to make permanent the ability of licensed pharmacists to serve as limited service lab directors to order and administer COVID-nineteen and influenza tests. We're very supportive of this and we encourage the legislature to expand this proposal to include other important point of care tests that can be administered by licensed pharmacists, as well as treatment initiation like we can do today under the PREP Act with COVID. We also support Senator Rivera and Assemblyman McDonald's bills to enable pharmacists to begin the initial stages of care following a positive test result for COVID-nineteen, Strep A, and flu. Further, the bill calls for the establishment of procedures between pharmacists and other health care providers, and we would also welcome reimbursement from health care plans for these services. Protect Patient Access to Pharmacy Act. Pharmacies across the state have been strongly supporting and advocating for the advancement of legislation introduced by Senators Scouffis and Assemblyman McDonald to provide a minimum reimbursement level that pharmacy benefit managers must pay pharmacies in state regulated commercial insurance plans. Today, is common for the majority of prescription claims submitted by pharmacies to be paid below cost. We need this to be changed in order for pharmacies to remain viable. We are asking that this also be included in one house bills and the final budget. Finally, New York State OMIC audit reform. Yes, please. And thank you.

[Speaker 0]: A good closing. Thank you very much. Senators? Okay. Assembly members?

[Assembly Member Gary Pretlow]: Assemblyman Edward.

[Assembly Member David Weprin]: Thank you, Mr. Chairman. I

[Senator John C. Liu]: want

[Assembly Member David Weprin]: to thank Mr. DeVoli for his comments about the biomarker testing bill. I chair the insurance committee in the assembly, and we worked on that bill for two years. And we worked with the governor in order to get her to sign the bill and and we had many, many conversations. So I certainly will advocate to, you know, restore it. It just went to it in effect not long ago. It was a delayed effective date. And now the governor's proposing removing it from Medicaid coverage. So so I will fight strongly to get that back in. And I think you'll see it in our one house budgets. Thank you.

[Assembly Member Gary Pretlow]: Has someone wanted to call in?

[Assembly Member Amy Paulin]: Not a question. We're tired. But I really just want to appreciate that you're here. And a very big supporter of hospice, as you know.

[Speaker 0]: I'm going to say ditto. I think Amy and I continue to try to work

[Denise Olivo]: on

[Speaker 0]: hospice issues. And we also are frustrated that the governor doesn't seem to understand what a valuable health care tool this is that we are not utilizing as well as we should here in New York.

[Speaker 21]: And our association recognizes the leadership there, and we just pray that we can make we can make a difference this year in the budget. Thank you.

[Assembly Member Gary Pretlow]: Thank you. Soldier Member Jensen?

[Assembly Member Josh Jensen]: Yeah. Ms. Chirico, how much did the governor propose funding for hospice and palliative care in the executive budget proposal?

[Assembly Member Jessica González-Rojas]: $0.

[Assembly Member Josh Jensen]: How much was allocated for hospice and palliative care in last year's budget?

[Helen Schaub]: $0.

[Assembly Member Josh Jensen]: How about the year before that?

[Speaker 0]: 0.

[Assembly Member Josh Jensen]: And the year before that?

[Helen Schaub]: 0.

[Assembly Member Josh Jensen]: And where do we rank in hospice access?

[Speaker 21]: Absolutely last.

[Assembly Member Josh Jensen]: Thank you very much.

[Speaker 0]: I see a senator walking in. Do you have any questions?

[Speaker 6]: No. No. He doesn't. He says you don't.

[Speaker 10]: You don't. Perfect. You have summed it up.

[Speaker 0]: Okay then. Well, then we all wanna thank you very much for being with us here tonight. Appreciate it.

[Speaker 7]: Thank

[Speaker 0]: you. And now we are actually coming to our final panel of this hearing, panel j. And we have Professor Victor Roy from the University of Pennsylvania, Christopher Morton, Associate Professor of Law, NYU School of Law, and Max Goldberg, New York chapter leader of the T. International Insulin for All group coalition. Oh, but I only see two of the three. So let's see who we actually are joined by. Hello?

[Speaker 22]: And Chris. Oh.

[Speaker 10]: Push the

[Dr. James McDonald]: push the buttons. Green.

[Helen Schaub]: There you

[Speaker 0]: go. So the professor from Pennsylvania didn't join us or had

[Dr. James McDonald]: to Correct.

[Christopher T. Morton]: He was not able to make it. Okay.

[Speaker 7]: No

[Speaker 0]: comment. Okay. So let's start with Christopher Morton and then go to Max Goldberg.

[Speaker 40]: Terrific.

[Speaker 0]: Thank you.

[Christopher T. Morton]: Thank you very much for this opportunity to testify. My name is Christopher Morton. I testify in support of S one six one eight eight three two three six, the New York Affordable Drug Manufacturing Act. I am an associate professor of law at NYU Law, but what I say does not necessarily reflect the views of NYU, if any. I'm here in my capacity as a lawyer. I represent pro bono the independent diabetes patient advocacy group T1 International, as well as the New York Insulin for All chapter, of which Max is the leader. I've worked with these advocates for several years now to analyze public pharma, and by public pharma I mean public agencies such as state departments of health, taking on functions typically performed by for profit companies in our health care system in the long process of getting drugs and vaccines from laboratory to factory to patient. These functions include manufacturing, distribution, and pricing. A New York state drug brand like that created via S 16 '18, A 3236 could reduce costs for New Yorkers, not just for patients with high out of pocket costs, but for everyone who pays taxes and premiums in this state. A state owned drug brand could help create a more robust, resilient supply chain, reducing shortages devastating to patients and to public health. Two quick points I want to make. First, a state owned drug brand is feasible. While our state does not currently operate a drug brand or manufacture and distribute medical products on a substantial scale, It's done so in the past, including in the very recent past. During the worst days of the COVID pandemic, the Department of Health was instrumental in development, validation, manufacturing, procurement, and distribution of vaccines, treatments, diagnostics, and personal protective equipment. Massachusetts Mass Biologics, a state owned nonprofit drug company, has been manufacturing and distributing medicines for over a century now. And California, its burgeoning CalRx initiative, which is a state owned drug brand, is now procuring and distributing naloxone and insulin pens at low cost, and it plans to procure and distribute albuterol inhalers and more forms of insulin soon. Second point I want to make, a New York state owned drug brand could work with other initiatives of publicly owned pharma, such as public options in pharmacy benefit management, in insurance, and more. Secretive, predatory, for profit pharmacy benefit managers, or PBMs, are a particular problem, and we know that state governments can replace and regulate these companies with more transparent, lower cost public options in pharmacy benefit management. And indeed, some states are already doing this. Public PBMs and state owned drug brands can work together legally and practically to unlock more benefits for more patients and payers. In my view, this synergy is all the more reason to support S. Sixteen eighteen and A. 3,236. I have more in my written testimony. I thank you for this opportunity.

[Speaker 0]: Thank you.

[Max Goldberg]: Good evening. And, thank you so much for this opportunity to testify at this hearing and to bring a patient's perspective to Albany. I also want to thank this legislative body for the actions it's taken over the last few years to address the outrageous and life threateningly high cost of insulin. I can tell you firsthand that policies like the copay ban have made my life as a diabetic New Yorker significantly easier. It's from that place of gratitude that I'm here to ask you all to go further and to take the strongest possible action you can to end the insulin pricing crisis here in New York by passing s one six one eight eight three two three six, the Affordable Drug Manufacturing Act.

[Dr. James McDonald]: My name

[Max Goldberg]: is Max Goldberg. I'm a type one diabetic. I am the chapter leader of t one International's Insulin for All chapter here in New York. We are a group of, diabetics and our allies who fight for more affordable insulin. I was diagnosed with type one diabetes out of the blue in 2019. People will often ask me what it was like dealing with that sudden diagnosis, and I often sum it up in just one word, powerless. I was powerless because I suddenly needed insulin every single day to stay alive, and the entities that controlled my access to that life sustaining medicine didn't care if I lived or died. They only cared about their own profits. Out of all the possible solutions to killer insulin prices, the Affordable Drug Manufacturing Act is the only one that addresses that power imbalance head on. S sixteen eighteen would empower New York to produce or partner to produce its own generic insulin, bringing a lower cost competitor onto the market. It would address the key cause of insulin's outrageous price, the cartel model established by the big three major insulin manufacturers, Eli Lilly, Sanofi, and Novo Nordisk, who control over 90% of the insulin market in The United States. While S1618 would start with insulin, its scope could extend to other essential medicines that have been monopolized and price gouged, inhalers, EpiPens, naloxone, and more. I don't have time to get into all the potential benefits of s sixteen eighteen. All of that is available in our written testimony and testimony submitted by other experts including potential cost savings to New York. I just want to focus on one issue here while I still have the time which is creating a reliable supply chain for essential medicine. Supply chain disruptions and shortages are not abstract boogeymen for diabetics, they are a life threatening reality. In 2024, one of our chapter members, Arden, went to the pharmacy cash and prescription in hand to pick up his insulin. He went home empty handed. Why? Because due to what it called brief delays in manufacturing, Eli Lilly's insulin was out of stock across the state and across the country. Arden did what any diabetic would do. He turned to expired insulin that he had stockpiled for an emergency. That decision landed him in the ER. Those delays were not limited to Eli Lilly. They extended to Novo Nordisk, they went all across the country. Beyond corporate malfeasance, whether it's an f d, unreliable and unpredictable FDA or increased hostilities with a major insulin producing country like Denmark, continual chaos on the federal level creates a consistent threat to insulin access for New Yorkers. Thankfully, it's a threat that we can take on head on and can insulate ourselves from by establishing our own transparent self contained supply chain. S sixteen eighteen, A three two three six does that and more. And we are happy to answer any questions you guys have about it. Thank you for the time.

[Speaker 0]: Thank you. Senators?

[Speaker 10]: Thank you, gentlemen. Spoiler alert, it's my bill. So I'm very thankful that you folks are here. But I think it's important. I was just having a conversation with my colleague here, and I actually wanted to pose the question to you. So if you're talking if you're saying, for example, insulin, right, which, if I'm not mistaken, when it was discovered, the physician that discovered it actually said, I'm not going to take a patent on this because it's required for human beings to live. So how is it that other companies, if we're talking about something that is how is it that private companies have come up with a formula that they have been able to patent? And why doesn't a company corner the market, if you will, by making a version saying, we're going to make generic versions much cheaper, everybody's going to buy that one? You tell us why that's the case?

[Senator Jake Ashby]: J. I will let the patent law expert start, and then I will chime in.

[Christopher T. Morton]: J. I'll do my best. It is absolutely true. Insulin as a pharmaceutical product is over a century old. The forms of insulin that are most widely used by people living with diabetes today are not those older forms. There are, in fact, some old forms of insulin, like so called Walmart insulin, that are older and that are available at comparatively low cost. But the standard of care forms of insulin are newer. They're analog insulin, so they're chemically modified. And those were under patent until recently. I believe most of them were invented in the '90s and came off patent in the 2000s, 2010s, around there. You might ask then, well, if those patents are expired, why don't we see robust competition driving costs down? I think this is a story of oligopoly. We have the big three Novo Nordisk, Lilly, and Sanofi. And an oligopoly that is sort of entrenched and in league with the pharmacy benefit managers and other incumbents who set prices J.

[Speaker 10]: Say it's like a wink and nudge, like a wink and a nod, a

[Speaker 56]: say no more type of

[Speaker 22]: situation. J.

[Christopher T. Morton]: There are studies that show almost like like with airlines, like lockstep price increases among the big three. So they know that they can get away with just ratcheting up the price year after year in The US. There have been companies actually have produced very high quality biosimilar insulin products, but they've really struggled to break into the market because PBMs don't put them on formularies, difficulties elsewhere in our complex system. In my mind, part of the power of a public drug brand and a public option in pharma is the state can make a market for these insurgent companies. That's exactly what CalRx is doing. It's making a market for an Indian company that has a linsulin product ready to go. Civica, a nonprofit drug brand, is developing more low cost, high quality products that the state of California is going to help get on the market. New York could piggyback on that.

[Senator Jake Ashby]: Yeah. All I would add is that Chris invoked CalRx, the California owned drug brand, making a market when we think about potential savings the state could see with this kind of program shifting over state payers to a New York state drug brand, something like Nyship. That's where a lot of potential savings can live and How much?

[Speaker 10]: How much?

[Senator Jake Ashby]: That's available in our written testimony. We're working with economists right now to get that modeling done, but we can share more.

[Speaker 10]: Thank you so much.

[Speaker 0]: I know. They're controlling us. So I thought that New York a year ago did put a maximum co pay on insulin of, I think, dollars 10 a month, maybe $15 But so of all the drugs that we should start with, why would we start with insulin where that one sounds like we sort of have it under control? Explain to me why that's not right.

[Senator Jake Ashby]: Yeah. I can speak briefly about a diabetic's experience with those co pay bans, and then I think you can speak to why structural. Yeah. Why policy like this might go beyond co pay bans. Yeah. I can tell you, I myself, as someone who gets their health care through a state sponsored health plan through the open market, I thought my copay was banned. Beginning of last year, it was. I went to the pharmacy. $0 at pickup. It felt amazing. Within a couple months, kind of inexplicably, was back up to $35. Unclear to me, unclear to the pharmacist, unclear to my insurance when I spoke to them. Other members in our chapter, we have chapter diabetics, folks who are on private insurance have had copays ranging from thirty five to $50. And I know the the specific populations that some of those policies apply to are are kind of different across the board. I think there's a lot of misconceptions around insulin pricing. Our organization did a nationwide study, in the wake of all that good PR that the pharmaceutical companies generated for themselves with certain commitments to lowering prices, those were not widely accessible. It all depends on, like, a confusing level of knowledge that exists somewhere between the patient themselves, their insurance, and the pharmacy, and folks often slip through the cracks. So I can tell you that, like, the the blanket coverage of that is a little spotty and that a state drug brand, in addition to kind of guaranteeing one set price, the way that it can interact with state payers like NYSHIP or or other entities would guarantee that price across the board.

[Speaker 0]: Thank you.

[Christopher T. Morton]: Yeah, I'll add just briefly. The co pay cap, co pay ban is incredibly important for individual patients but do not address the underlying problem of high costs, which end up borne by all of us who pay premiums as insured people, and all of us who pay taxes towards public programs in New York State. So in some sense, we're spreading the high costs across all New Yorkers, but we're not actually attacking the underlying problem unless we find a lower cost source of these products.

[Speaker 0]: J. So you know how, thanks to the disaster of the federal government doing away with all of our assumed behaviors towards FDA and national policy, we have now states going down their own paths. And so there are states who have gone down some of these paths. Are we better off going into joint ventures with them rather than being one more state trying to set up our own companies? J.

[Senator Dan Stec]: J. I

[Christopher T. Morton]: think the answer is sort of yes to both in a funny way,

[Speaker 40]: like, if I may.

[Assembly Member Gary Pretlow]: J. Take my three minutes. J.

[Speaker 0]: Thank you. J.

[Christopher T. Morton]: Thank you so much.

[Amir Bassiri]: J. Same question.

[Speaker 10]: J. J.

[Christopher T. Morton]: If the state were if New York State were to create its own drug brand, it would be chartered within the state. It would serve patients within the state. It would help save money for New York State programs. But it would almost certainly be part of the broader the national and international market for these medicines and would probably be talking closely with California, with Massachusetts, with the other states that have these public brands. I mentioned before, California actually is a few years ahead of us. They chartered their drug brand in 2020. They put up a bunch of money, dollars 100,000,000, to this nonprofit drug company called Civica to help Civica develop multiple forms of insulin. Civica now has products that it's apparently about to seek FDA approval for. Civica has said if those products get FDA approval and start going to California, Civica will offer the same products to every other state and payers in other states at the same price. So we have an opportunity to tap into the sort of momentum that these other states are creating. So I think there's a lot that states could do in terms of knowledge sharing and piggybacking on each other's efforts, if that makes sense. But New York would have its own brand. J.

[Speaker 0]: That's a great answer. Very, very happy you answered this question. You. Anyone else? Right. Then I'm going to officially close down this hearing. Thank you both for coming and educating us about another good bill from Senator Rivera, and thank you very much. And tomorrow morning, we start the always a popular tin cup in hand hearing with the local governments from throughout the state of New York showing up here to tell us what they're hoping to see come out of the budget process. So thank you everyone who came and stayed for health care today.