A multibillion-dollar Medicaid spending gap could take center stage this upcoming budget season, which starts with New York State Governor Andrew Cuomo’s annual State of the State address in mid-January.

After delaying $1.7 billion in payments to avoid piercing the Medicaid Global Cap that limits spending growth to the rate of medical inflation, the Division of the Budget (DOB) recently projected that the fiscal year 2020 gap will be from $3 billion to $4 billion. Governor Cuomo said last week that the Medicaid shortfall “is going to be a major financial issue for the State,” citing decreased Federal assistance, increased labor costs, and higher enrollment as causes.

State law permits DOB to cut Medicaid rates unilaterally if spending exceeds projections. The Legislature can choose to respond with its own plan to cut costs. DOB will likely delay another payment.

The GNYHA-1199SEIU Healthcare Education Project produced the attached talking points detailing the need to protect the Medicaid program, the people who depend on it, and New York’s vital safety net hospitals.

The Assembly and Senate will leave Albany earlier than usual next year—on June 2—because primary elections have been set for June 23. Democrats hold large majorities in both chambers.

The 2020 session calendar is attached.