Department of Health

The Executive Budget recommends (revised January 21, 2004):

·        A decrease of 58 FTEs in SFY 2004-05 from the adjusted 3/31/04 FTE level.  The adjusted 3/31/04 indicates a net increase of 7 FTEs during the current fiscal year, including an increase of 22 positions in the Community Health Program. The 58 reductions in 2004-05 reflect a decrease of 92 FTEs, offset by an increase of 35 FTEs.  Net reductions in FTEs occur in the following programs:  Administration and Executive Direction (-26); Child Health Insurance (-1); EPIC (-1); Environmental Health (-9); Health Care Financing (-5); Health Care Standards and Surveillance (-8); Laboratories and Research (-24); Office of Managed Care (-8) and Office of Medicaid Management (-9).  Net adds in FTEs occur in the Community Health Program (+8) and the Medicaid Audit and Fraud Prevention Program (+25).  The estimated year end workforce will be 5,861 FTEs on March 31, 2005.

·          An agency wide All Funds increase of $99.7 million (2.2%).

·          Unexplained increases in personal services may reflect the additional pay period for the institutional payroll for SFY 2004-05.

·        Apparent merger of the Office of Continuing Care (333 FTEs) with the Health Care Standards and Surveillance Program, with a reduction of 4 positions in the current year for the combined programs and 8 positions in SFY 2004-05.  There is no mention of this merger in the budget documents.  This should be raised with management.

·        Shifting 13 positions in the AIDS Institute program from General Fund to Special Revenue-Other funds.

·        A reduction of $5 million in funding for Roswell Park Cancer Institute (to $78 million). Funding for Roswell Park is in the Article VII HCRA legislation, not in the DOH budget.

·        A decrease of $2.7 million in personal service funding agency-wide.  Significant reductions occur in the Administration and Executive (-$692,000); AIDS Institute (-$936,000); Office of Medicaid Management (-$765,500), and Health Care Financing (-$547,000). The personal service appropriation for Wadsworth increases by $1.1 million.

·        The Health Care Standards and Surveillance Program includes a new $6.6 million maintenance undistributed appropriation for “continuation of care surveillance related activities.”  Management should be asked for an explanation of this appropriation.

·        An increase in the Institutional Management Program of $7.4 million, including increases for Helen Hayes (+$1.9 million), NYC Veterans Home (+$1.3 million) and the Lower Hudson Veterans Home (+$2.8 million).  A $7.5 million Maintenance Undistributed appropriation for Helen Hayes is eliminated. This should be addressed with management.

·        An increase of $10.4 million in the Center for Community Health Program Special Revenue-Federal funds, including an increase of $6.0 million in the Federal Food and Nutrition Services Account, $1.9 million in the Individuals with Disabilities Part C Account, and $2.5 million in the Federal Block Grant Fund.

·        A decrease of $2.5 million (17.5%) in the EPIC Program, including a reduction of $324,000 in personal service and $2.2 million in nonpersonal service.

·        Transfer of all Fiduciary fund accounts to Special Revenue-other accounts.

·        A Replacement Medicaid System (RMS) that will replace both MMIS and the Electronic Medicaid Eligibility Verification System (EMEVS) with an integrated claims processing system.  Continued oversight by state personnel needs to be confirmed through Labor/Management.

·        A $21 million bond financed appropriation for the State share of a $60 million project to re-build the Veterans Nursing Home at Oxford.

·        $10 million to implement a series of initiatives to improve the quality of life and safety for adult home residents in New York.  It is unclear where in the budget this appropriation occurs.  This should be clarified with management.

·        Article VII legislation which eliminates low-priority programs, strengthen pharmacy fraud prevention; and imposes EPIC and Early Intervention (EI) cost containment proposals, including imposing fees on for EI on families earning more than 250% of the Federal Poverty Level.

·        Article VII HCRA modifications, including restoration of a 0.7% assessment on hospital revenues and authorizing additional non-profit insurance company conversions to for-profit entities, allowing the investment of a portion of the proceeds in HCRA; and reduces funding for Roswell Park Cancer Institute by $5 million.

·        Article VII legislation to restructure the Medicaid program, including cost containment proposals and  State assumption of the local government share of long term care costs over a 10 year period, contingent on enactment of measures to control long term care costs.  This includes: elimination of certain optional services; eliminating loopholes that allow individuals to refuse to contribute any of their income and assets towards the cost of long term health care for a spouse; increasing the use of Medicaid managed care for the dual eligible and SSI population;  requiring co-payments in Family Health Plus; cost containment proposals for pharmaceutical costs, including a preferred drug program; and establishing a utilization and case management system for high cost Medicaid recipients who access substance abuse, mental health and developmental disability services. The potential impact of the following proposed savings measures on state operated nursing facilities should be addressed with management:  re-establishing the reimbursable nursing home assessment at 6.0%, updating nursing home reimbursement rates; the elimination of supplemental payments for hospital based nursing homes and facilities with more than 300 beds; and increasing the assessment on nursing home receipts from 5 percent to 6 percent.