The U.S. Department of Health and Human Services approved a waiver for New York state that will provide up to $8 billion in extra Medicaid funding for the next five years.
Most of the money will help shore up several financially struggling hospitals in Brooklyn, the New York Daily News reported.
Brookdale Medical Center, Interfaith Medical Center and Wyckoff Heights Medical Center in Brooklyn will be able to "survive" in the long-term now, officials with Gov. Andrew Cuomo's (D) office told the Daily News. During more than 18 months of negotiations with the federal government, Cuomo's office suggested that the three facilities might close down without a cash infusion. Cuomo heavily criticized HHS during the negotiations.
Brooklyn's healthcare delivery system is already under stress. A bankruptcy court continues to provide Interfaith Medical Center, which is currently in bankruptcy proceedings, with cash infusions to keep it operating essentially on a day-to-day basis, New York 1 reported. Health policy officials fear Interfaith's closing would cause other hospitals in the borough to be overwhelmed with patients.
New York officials did not get everything they wanted--the $8 billion was $2 billion less than they originally requested.
And the hospitals will be under a mandate to avoid readmissions and cut down emergency department use by 25 percent, according to Crain's New York Business.
"It isn't for propping up everything we have now; it's for funding the next generation of healthcare delivery," James Tallon, president of the United Hospital Fund, told Crain's. "So by definition it can't be viewed as bailing out the current system."
But the hospitals will suffer some losses. "This is about transforming hospitals that are financially unstable," Cuomo told Crain's. "Will it mean some hospital beds are reduced? Yes, because that is the point of the exercise. You will have a decrease in beds."