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���������� Note: The two articles below highlight yesterday’s State Medicaid legislative hearing, in which testimonies discussed DSRIP, the Basic Health Program, and other aspects of system reform. While the $6.4b in DSRIP waiver funds seemed to take up the most airspace, it is also clear that legislators are concerned about levels of oversight and transparency in hospital restructuring, and the amount of input and awareness of community members and consumers outside the sector have of the ongoing changes.

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State Looks to Health Goals; Meeting Focuses on Cutting Costs While Improving Services

Times Union; Claire Hughes, 2/3/2015

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��An annual legislative hearing on the governor’s proposed state budget for health and Medicaid spending Monday focused on restructuring the state’s health system to meet the goals of government reforms aimed at cutting medical costs while improving the quality of��services.

With the popular, hot-button issues of last year either resolved, under way or nixed — topics like medical marijuana, the state’s Obamacare health exchange and hydraulic fracturing — the hearing was more subdued, covering a broad range of territory and some nitty-gritty details of health��policy.

A significant amount of the day’s discussion concerned the conflict between health reforms that seek to cut costly hospital stays and the desire to keep hospitals operating in their communities as they transform the way they provide��care.

Topics included plans to distribute $6.4 billion in Medicaid waiver funds from the federal government — funding that had not been secured a year ago — under a competitive application system that calls for collaboration among hospitals and health systems. The state also plans to award $400 million to rural hospitals and $700 million to hospitals in Brooklyn and Oneida County. The Oneida County funding was awarded after the region submitted what state Medicaid Director����called a “unique proposal” to the��state.

��Chairman����asked Helgerson if other regions knew they could receive money if they could apply for��money.

“No, they did not,” Helgerson��said.

“That doesn’t seem fair,” DeFrancisco��said.

Of concern to some lawmakers was a proposed cut in Medicaid reimbursements to pay pharmacies for prescription drugs according to a formula that calculates the average wholesale price of the drug and then subtracts 24 percent. The formula was derived following a survey of pharmacies, state Medicaid Director Jason Helgerson��said.

“I don’t think in this market that’s attainable, unless we get to purchase drugs from Canada,” said Assemblyman��, who owns Marra’s Pharmacy in��Cohoes.

Lawmakers pressed Executive Deputy Commissioner of Health Sally Dreslin on a March 27 deadline for having all-electronic systems in place for prescribing medicine, including narcotic painkillers and other controlled substances. Doctors, hospitals and other medical providers have requested an extension on the mandate, stating that its implementation is costly and in the hands of private software vendors as well as the federal��.

Dreslin said she was hopeful that an agreement could be reached that would meet the needs of providers as well as the state’s goals to reduce prescription errors and improve patient safety. Assembly Health Committee Chairman��, D-Manhattan, pointedly asked why providers haven’t already been told if an extension is��likely.

“If it’s going to be postponed, it would certainly be at least polite to let people know that sometimes before March 27,” Gottfried��said.

Helgerson was questioned about the Cuomo administration’s plans to implement a Basic Health Plan under the federal Affordable Care Act. It would provide free medical services to ����������ers who earn too much money to qualify for Medicaid, but remain below 200 percent of the federal poverty level. The federal government would kick in $600 million to get the program started. But����Chairman����said he was concerned about supporting the program��afterward.

“I wonder what happens the second, third and fourth year,” Hannon��said.

Several lawmakers expressed concern over the administration’s proposal to save $1.2 million by eliminating the Physician��, which allows consumers to look up information about their doctors. Dreslin said the information on the site was available to consumers elsewhere, but lawmakers including Hannon and Sen.����praised the easy access of the state site as well as the��‘s ability to monitor��it.

Senate Health Committee Chairman Kemp Hannon chastised Dreslin for the Health Department’s inaction in two areas: a lack of report from a Lyme disease task force established last year, and delays in restructuring its organ transplant��process.

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Budget hearing: health care industry’s wish list

Yesterday’s joint Senate and Assembly budget hearing on health care, which finally concluded at 5:43 p.m., provided a snapshot of what will be the more contentious issues during this year’s budget negotiations.

As usual, hospitals highlighted cuts to providers in the budget. Dennis Whalen also took an enlightening step back from the budget in��,�� to address the many reforms being thrown at providers right now. “Are we testing the system’s ability to absorb change?” he asked. “There may be such a thing as a saturation point.” It was a point picked up on by Sen. Kemp Hannon, who admitted to “major apprehension about change.”

Outside the industry, ����������ers have no idea that their local hospitals may be downsizing, or that the state is moving to value-based payments. “I am concerned that people outside the arena don’t understand change and what is about to happen,” he said.

In his��, David Rich spoke of “numerous hospitals on the watch list for closure,” and of Medicaid rates that only cover 72% of costs: 91% on the inpatient side and only 61% of outpatient services. “We have significant concerns about safety-net providers,” he said. GNYHA supports the executive budget proposal for $290 million in VAP funding “as a further bridge until reforms take root” for the 27 hospitals that currently get VAP funding that expires in March.

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Health Plan Association President Paul Macielak was direct in his opening salvo. “Just say no to the exchange tax; $68 million in new taxes is not appropriate today,” he said in his��. He suggested instead tapping the 1.2 million newly insured in ���������� state through the ���������� State of Health who would have paid into HCRA if not for the exchange. That proposal was rejected, and “instead we’ve got a new tax in front of us.” Mr. Macielak estimated that ���������� insurers will have $200 million in new taxes built in to the rate requests for 2016. But at the same time, many health plans “are hurting,” especially in the small group market.

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The testimony of the Home Care Association of ���������� State’s executive vice president,��, emphasized that while the executive budget proposes capital investment in health care, home care providers are not expressly included despite, “the critical role of home care in the success of system models.”

The key issues for the��, are modifying the proposed $1.4 billion in capital for hospitals to include community health and to restore Medicaid and Medicare parity for primary care doctors.

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