Budget Negotiations Heat Up as Deadline Approaches

March 25, 2022

Executive Branch and Legislature leadership staff are hammering out agreements on health care, education, public safety, hand many other areas as the April 1 deadline for an on-time budget approaches. Last week, the Assembly and Senate released and passed their “one-house” budget proposals, which laid out their policy and spending priorities ahead of final negotiations.

Highlights of the one-house budgets include:

  • Medicaid Both houses accepted Governor Kathy Hochul’s 1% rate increase and elimination of last year’s 1.5% cut.
  • Behavioral Health Governor Hochul proposed a 5.4% human services cost-of-living adjustment (COLA) for behavioral health services provided by hospitals, including Comprehensive Psychiatric Emergency Program services, crisis outreach, inpatient rehabilitation, partial hospitalization, mobile crisis teams, and substance use services. The Assembly doubled this adjustment to 11% and added inflation increases in future years. The Senate accepted it and added an additional 5.4% in the next fiscal year.
  • Financially Distressed Hospitals The Assembly created a $750 million pool for safety net hospitals and provided $250 million for public hospitals. The Senate created a $1 billion fund for safety net hospitals.
  • Capital The Assembly accepted the Executive proposal to create a $1.6 billion pool for health care providers; the Senate did as well but added $400 million for high-Medicaid providers.
  • Worker Bonuses Governor Hochul proposed $3,000 payments for frontline health care workers who provided pandemic response. The Assembly restricted this proposal to State employees; the Senate accepted the Executive proposal and broadened eligibility beyond clinical titles.

GNYHA continues to urge Albany to further invest in Medicaid rates—especially hospital behavioral health services, given the mental health crisis New York State is facing—and financially distressed hospitals. For more information on the one-house budgets, see ML-20 and GNYHA’s comprehensive side-by-side table.

Possible last-minute sticking points in budget negotiations include bail reform, relief for high gas prices, home care pay, and school aid. While State coffers are full right now, many interests are pushing Albany to spend on different programs; Albany leaders could find it difficult to fund these commitments while balancing the budget.

The Assembly and Senate asserted their institutional prerogatives in the one-house budgets, rejecting many Executive proposals without a monetary impact; it remains to be seen how much policy will survive in the final agreement.