New York state will have as much as $1.5 billion in federal funds to invest in health information technology and related initiatives under a waiver granted late last month by the Centers for Medicare and Medicaid Services.
The waiver, granted as a five-year research and demonstration project, requires the state to achieve Medicaid cost reductions while improving programs and facilities. The aim is to keep the federal contribution to New York’s Medicaid program unchanged while the state undertakes reforms.
In particular, the New York Federal-State Health Reform Partnership (F-SHRP), as the program is known, will result in consolidations of hospitals and nursing homes. Some older facilities will close and others will be modernized.
The state is investing $1.5 billion of its money in health IT and facilities modernization through the Heal NY program and other programs. Earlier this year, it doled out $52.9 million in grants for state health information exchanges, and now it is weighing applications for building projects.
Under F-SHRP, state programs not directly associated with Medicaid can get 50 percent federal matching funds. Without the waiver, the federal funds would not be eligible.
New York is by far the biggest state spender on Medicaid. In fiscal 2003 -- the most recent year for which complete figures are available -- state and federal governments paid out $35.2 billion for about 4.4 million beneficiaries. California, the next largest consumer of Medicaid funds, spent $25.8 billion in state and federal money on 9.3 million beneficiaries. This year, the bill for New York will be $43 billion.
New York Gov. George Pataki has made health care reform a centerpiece of his administration’s policies. Much of the cost reduction will be achieved by providing more care to patients outside hospitals, providing home care in lieu of nursing homes and improving coordination of care and disease management.
The Commission on Health Care Facilities in the 21st Century will make recommendations by Dec. 1 on hospital and nursing home closures and consolidations. The Medicaid waiver requires New York to implement those recommendations.
According to state officials, the waiver also requires the state to increase Medicaid fraud and abuse recoveries, implement a preferred drug list for Medicaid, find ways to insure employed but uninsured New Yorkers and provide better guidance for those needing long-term care.
State and federal officials emphasized that CMS will monitor New York’s performance under the waiver and will terminate it if agreed-upon milestones are not attained.
“I applaud Gov. Pataki and the state of New York for facing the challenges to the Medicaid program and taking action that will improve care for beneficiaries while also sustaining Medicaid into the future,” Health and Human Services Secretary Mike Leavitt said in a statement.
New York applied for the waiver about 17 months ago. Although state officials expected faster approval, reviews by CMS, HHS and the Office of Management and Budget – along with negotiations over the terms of the deal – delayed it.
The waiver is the only one of its kind, a CMS spokeswoman said. However, Leavitt encouraged other states to consider such reforms.
From the battlefield to the home front: Managing medical data
Government Health IT presents Col. Claude Hines Jr., program manager for the Defense Health Information Management System, in this recent InSight eSeminar. Col. Hines discusses the health information technology and tactical challenges faced by the military medical community in Iraq, Afghanistan and other areas of conflict. In doing so, he describes the current information technology solutions for transferring clinical data between battlefield care givers to health care personnel at military treatment facilities worldwide.
