Are NYC hospitals getting more than their share of Medicaid funds?

Downstate New York hospitals will receive the majority of $8 billion in extra Medicaid funding approved to help the state reduce preventable admissions, a trade group leader told Albany Business Review.

Gary Fitzgerald, president of Iroquois Health Alliance, which represents 53 upstate New York hospitals, said his initial calculations found upstate facilities would receive about $2 billion. However, Fitzgerald said, if distribution continued with the proportions of the initial dispersal of $500 million earlier this month, the gap would be wider.

These findings exacerbate concerns about unfair influence wielded by New York healthcare providers, Fitzgerald told ABR. ""Are [regulators] basically saying, 'Sorry guys, you're not in the plan for the future of healthcare delivery'?" 

To arrive at his findings, Fitzgerald analyzed regional enrollment in the Medicaid program, finding that about 25 percent of enrollees are upstate compared to about 75 percent downstate. But during the first wave of funds on July 8, about 85 percent of the $500 million went to downstate healthcare providers, Fitzgerald told ABR. The state's Department of Health has primary oversight for how the money is spent, with primary goals including improving hospital efficiency and reducing unnecessary visits, according to the article.

According to Gov. Andrew Cuomo's (D) office, the majority of the money will go to shoring up financially unstable hospitals in Brooklyn. "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." An April survey found that nearly half of New York hospitals--49 percent of 90 respondents--were unsure of how to use the additional funds.

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