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More on Living Wage Affect on New York's Medicaid System
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| Living Wage ordinances have been a problem for health care providers because often there is nowhere to shift the costs incurred. Medicaid reimbursement is limited and the burden cannot be shifted to private care customers because this would price the company out of the market. And though activist literature says they would like new wage laws to apply to an entire company's payroll, this is fiscally impossible and the result is two separate payrolls within the company.
Currently New York's Medicaid reimbursement system operates on a two-year lag, which means providers are not getting any funds to support the wage hikes. Because Living Wage ordinances usually are phased in over a three year period, it can be five years until the appropriate amount of money is being doled out. Living wage laws have created Medicaid problems in Westchester County, while the verdict is still out in Suffolk. New York City's system fared better because unlike other venues they received immediate reimbursement from the state for the increase. Carol Greenberg, President of Concept Care in Westchester and Julie Tighe Deputy Director of Advocacy & Outreach for New York State Association of Health Care Providers (NYSAHCP) say they fear the fallout of mandatory wage hikes could include employees demanding to work only the higher paying Medicaid cases, lay-offs and providers leaving the Medicaid industry to focus on private care. There has been a bill proposed in the state legislature, with the support of health-care providers, by State Senator Nick Spano and Assemblywoman Amy Paulin to correct part of this problem, by mandating that immediate reimbursement be available when a Living Wage ordinance is passed. If this bill does in fact pass, it remains to be seen whether the state would be willing to reimburse counties for the requested increase in funds from the already indebted system. The state recently passed a Medicaid reform bill that puts the onus on Albany to pick up the tab for any major increases in a county's Medicaid costs so common sense reasons that ultimately the decision will be theirs. |
Because health-care providers that deal with Medicaid are restricted by state caps on what they can charge customers and what they can expect in reimbursements, any changes in the system must be thought out carefully. The NYSAHCP says that the politically motivated Living Wage bills are not taking this into account. "These local laws are being enacted without addressing the fiscal implications such laws have on home care providers and they result in unfunded mandates that cannot be accommodated under the current Medicaid reimbursement methodology," NYSAHCP writes on their website (www.nysahcp.org). NYSAHCP has sent a form letter to its members opposing any attempts at a Living Wage bill in the county. The letter stressed the importance of home care workers to the industry and that providers have been working for a long time to increase their wages in a responsible way. "The State is facing a deficit that may reach $12 billion. The home care industry will be lucky to escape this budget year with our reimbursement and programs intact. Make no mistake; the cost of this living wage package will be borne by the home care providers in this county, which will result in business closures, reductions in service, and reduced access to care." "The implementation of this living wage package is nothing more than an unfunded mandate from the County to its businesses. It is no different than the unfunded mandates the State imposes on this county. If providers are unable to sustain this living wage increase, the workers and patients are the ones who ultimately suffer," the letter reads. Stories this week More on Living Wage Affect on New York's Medicaid System RBA Stalwarts to Hold Grand Opening in October, Celebrating New Business Office RBA's Third Annual Expo Boutique is this October 20 at the Suffern Holiday Inn
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