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A record number of New Yorkers relied on Medicaid for their health care in 2021, with monthly enrollments surpassing seven million for the first time, according to a new report from New York State Comptroller Thomas P. DiNapoli . While enrollments have grown about 5% per year for the past 15 years, from about one in seven New Yorkers in 1998 to one in three in 2021, the state’s budget projections are based on expectations. significant declines in registrations that may not materialize.
“Changes in federal and state Medicaid policies over the past decade have contributed to a sharp decline in the number of New Yorkers without health care coverage, ranking New York City eighth in the United States for non-residents. insured. This is good news, â€said DiNapoli. “However, if current enrollment trends continue, the state could face billions of dollars in unbudgeted costs. State policymakers should closely monitor trends in program enrollment and spending, and take action to ensure New Yorkers continue to have access to the health care they need. “
Medicaid is a federally, state, and local government funded program that provides a wide range of medical services to economically disadvantaged populations, including low-income children and their families, low-income seniors, and low-income people with disabilities. . The Budget Division (DOB) estimates that the state’s share of Medicaid will be $ 27.8 billion in the state fiscal year (SFY) 2021-2022, which represents the second category of state expenditure, exceeded only by education.
Registration trends
The share of New Yorkers without health coverage increased from 11.4% in 2008 to 5.2% in 2019, thanks in part to the expansion of Medicaid. The pandemic and the resulting economic recession pushed Medicaid enrollments in New York City to record levels in 2021, with the monthly number of people covered by the program reaching seven million for the first time in February 2021. Adults have accounted for two-thirds of the growth in registrations, up from 356,677 to a monthly average of more than three million registrants for the first three months of 2021. The mid-year update of the financial plan of the budget adopted for Fiscal year 2021-2022 predicts that monthly registrations will remain above at least seven million until March 2022, but will decline by nearly 17% by March 2023 and return to pre-pandemic levels of just over six million by March 2024 as the economy recovers, unemployment rates decline and temporary registrants begin to decline.
Spending trends
The federal share for most Medicaid services is determined by the Federal Medical Assistance Percentage (FMAP), which is based on a formula that offers higher reimbursement to states with per capita incomes below the national average. New York’s FMAP is the legal minimum of 50%, reflecting the state’s relatively high per capita income. As part of its response to the pandemic, the federal government increased its share of funding for most Medicaid services, including a 6.2 percentage point increase for New York City for each calendar quarter during the health emergency. public.
Specific trends in Medicaid spending include:
- Prior to the pandemic, from SFY 2007-08 to SFY 2019-20, total Medicaid spending (including federal, state and local actions) grew 5.4% per year, increasing by nearly $ 30 billion for reach $ 75.9 billion.
- During the pandemic, in SFY 2020-21, total Medicaid spending in New York City declined by about $ 650 million or less than 1% from the previous year, reflecting what may have been a decrease of the use of non-COVID medical care, especially early in the pandemic. State spending fell by more than $ 4 billion, reflecting the 6.2 percentage point increase in FMAP.
- The DOB predicts that total Medicaid spending will reach $ 83.8 billion in SFY 2021-2022, remain relatively stable through March 2024, and increase to $ 85.8 billion in SFY 2024-25.
Financial risk
DiNapoli’s report estimates the risk to the financial plan if enrollments remain at high levels:
- If enrollments remain stable at around 7.6 million, total unanticipated additional Medicaid costs (federal, state and local shares) of $ 20.5 billion – including $ 8.1 billion of unbudgeted state costs – could occur. ” accumulate by March 2025.
- If the number of registrations drops by 500,000, a third of the forecast in the financial plan, unforeseen costs of $ 13.5 billion – including $ 5.3 billion to the state – could accumulate by March. 2025.
- While registrations decline by nearly a million by March 2024, a slower pace than the financial plan anticipates, unanticipated costs of $ 6.5 billion – including $ 2.5 billion in costs for the ‘State – could result.
Recommendations
To ensure the long-term sustainability of the program, DiNapoli recommends that state decision-makers:
- Keep a close eye on enrollment trends. As the state’s economy continues to recover from the pandemic, Medicaid enrollment levels are difficult to predict due to historical circumstances. While DOB predicts a reduction of over one million registrants, there is no precedent for such a reduction in the program. To mitigate the impact of any failure to forecast declining enrollment, policymakers should actively monitor monthly enrollments and costs per registrant.
- Involve stakeholders in developing strategies to protect the quality of care and contain costs. Two comprehensive efforts to identify cost containment measures were completed as part of the Medicaid Redesign Team (MRT) process in 2011 and 2020, which were estimated by the DOB to generate savings of 2 , $ 7 billion and $ 2.2 billion, respectively, for each year and to limit future spending growth. However, the MRT could have benefited from a more timely and deliberative process with broader stakeholder engagement.
DiNapoli also supports the extension of the improved federal FMAP rates, which currently expire in March 2022, until the health or economic impacts of the pandemic are fully resolved.
Reporting
Medicaid: Enrollment Growth, COVID-19 and the Future
Track state and local government spending at Open Book New York. As part of State Comptroller DiNapoli’s open data initiative, search millions of state and local government financial records, track state contracts, and find the most requested data.
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