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Release: Cuomo says 'targeted federal attacks' will cost NYS $21.1 billion annually. Transcript included of his remarks about deductibility, DSH, CHIP, Obamacare repeal and replace.
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Text of press releases.


For Immediate Release: 10/3/2017
GOVERNOR ANDREW M. CUOMO



GOVERNOR CUOMO ANNOUNCES DEVASTATING IMPACT OF TARGETED FEDERAL ATTACKS ON NEW YORK STATE - COSTING OVER $21 BILLION ANNUALLY

1: The Defeated Graham-Cassidy Bill, Which Would Have Cost NYS $16.9 Billion by 2025 - the Most of Any State - Must Not Be Resurrected

2: Federal Cuts to DSH - Will Cost $2.6 Billion, Falling Hardest on Neediest Patient Populations

3. $1.1 Billion Cut to CHIP - Jeopardizes Health Care for 330,000 Low Income New York Children

4: The Proposed Federal Tax Plan, Which Eliminates the Deductibility of State and Local Taxes, Costing NYS $17.5 Billion Annually - the Most of Any State - Must Be Stopped

Governor Cuomo Mobilizes Coalition to Work with New York's Congressional Delegation to Stop Cuts


Governor Andrew M. Cuomo today outlined four major federal cuts, totaling more than $21.2 billion annually, that are part of policies targeted to directly hurt New York State- devastating state and local governments, straining public and not-for-profit hospitals, and jeopardizing quality healthcare for more than 3 million New Yorkers. Moreover, the cuts to New York State are disproportionate to the rest of the country - even as New York is the number one state contributor to the federal government, sending $48 billion more to Washington each year than is returned. Given the devastating impact of the federal government's reckless policies, Governor Cuomo mobilized a coalition to work with New York's Congressional Delegation to fight back and stop the cuts.

"These devastating federal cuts are a dagger in the heart to New York State, attacking needy healthcare patients, stripping away healthcare from children, forcing cuts on stressed hospitals and local governments and ultimately raising taxes on New Yorkers," Governor Cuomo said. "We will not stand idly by while the federal government targets middle and working class New Yorkers -- we must speak up now, mobilize to stop these devastating cuts and stand up for our New York values."

1. The Graham-Cassidy Bill - Defeated and Must Not Be Resurrected

The Graham-Cassidy bill was Congress' latest attempt to repeal the Affordable Care Act. The bill was projected to cost New York State a total of $40-60 billion by 2025 - more than any other state in the nation. The bill also jeopardized 1.2 million health care jobs in New York State, penalized states that expanded Medicaid and was written to end health care support totally in 2026.

Thanks to a national opposition campaign, New York's Congressional delegation and others raising their voices across the country, the Graham-Cassidy bill failed last week. However, Congress has made it clear that there will be further attempts to repeal the Affordable Care Act, which would be devastating to New York's health care industry, economy and ability to provide care.

2. Federal Cuts to DSH - Disproportionate Share Hospital Payments

Congress failed to rescind Disproportionate Share Hospital payment cuts that became effective on October 1, reducing critical federal funding that reimburses hospitals through the Medicaid program for uncompensated health care costs. These cuts will decimate New York's hospitals and fall hardest on its public and safety net hospitals that are already strained and serve the neediest patient populations.

In the next 18 months, these cuts will cost New York State $1.1 billion - more than any other state, and will cost New York State hospitals $2.6 billion when fully phased in. These cuts also diminish the quality of health care received by more than 2.8 million New Yorkers who are served by our public and safety net hospitals. These cuts ultimately will impact all 219 hospitals across New York. Public and selected safety net hospitals include:

Public Hospitals

SUNY Downstate
SUNY Upstate
SUNY Stony Brook
Nassau University Medical Center
NYC Health and Hospitals
Erie County Medical Center
OMH State-Operated hospitals

Safety Net Hospitals

One Brooklyn Health
Wyckoff Heights
St. John's Episcopal
St. Luke's Cornwall
Mt. Vernon
Rome Memorial
Bon Secours
WCA Hospital

Compared to other states, New York State is hit the hardest. The State receives 16 percent of the total cut, amounting to $2.6 billion. California and New Jersey each receive a $1.2 billion cut, and Texas receives a $1 billion cut. As the State already faces a $4 billion deficit, it cannot absorb this additional liability.
Under current state law for DSH distribution, funding first goes to all private hospitals for uninsured expenses up to the current legal cap, approximately 25 percent. Additional funding goes to public hospitals if a local government puts up matching funds. Lastly, funding goes to all public hospitals for up to 100 percent of the Medicaid and uninsured losses.

Public hospitals are owned by local governments who must address their economic reality. These are federal cuts to local governments and their hospitals. The State is in the same position with SUNY hospitals.

Now, with the cuts are real and in effect, there is no way to adequately fund the public hospitals if the $1.1 billion cut is not rolled back. All hospitals will need to find savings and local and State government will need to find ways to work with the hospitals to make ends meet given the new financial reality

State law says that if a Medicaid cut over $850 million takes place, the new plan is subject to legislation. KPMG has been retained as a financial adviser to advise on a detailed financial analysis of each hospital and their overall condition and to determine a strategy for how to best absorb the impact of next year's $1.1 billion hit. The State will also reconvene the successful Medicaid Redesign Team.

The New York Congressional delegation says that the cut will be restored by December 31. If this does not happen, the Governor has repeatedly said it may require a special session of the legislature to rework the healthcare budget. In the interim, the State is working with public hospitals to manage cash flow and protect patient care.

3. Cuts to CHIP - Children's Health Insurance Program - an Assault on Children's Health Care

The federal Congress failed to reauthorize the Children's Health Insurance Program, an innovative health insurance program that was pioneered by New York State, under Governor Mario Cuomo, before becoming a national program. CHIP insures children in families at up to 400 percent of the federal poverty level, covering those who are otherwise not eligible for Medicaid.

Congress's failure to reauthorize CHIP by September 30, 2017, jeopardizes coverage for 9 million children across the United States, including 330,000 in New York. The program provides comprehensive health care coverage for children, including coverage for routine checkups, immunizations, doctor visits, prescriptions, dental and vision care, inpatient and outpatient hospital care, laboratory and x-ray services and emergency services.

New York State's CHIP program is primarily funded by the federal government. The program in New York costs approximately $1.3 billion. New York State stands to lose close to $1.1 billion in federal CHIP funding if the program is not reauthorized. To continue CHIP without this federal funding would cost New York State $1 billion, on top of all other cuts.

4. Federal Tax Plan - Looming

The proposed federal tax plan eliminates the deduction for State and local taxes, costing New York $17.5 billion annually. Instead of ensuring cuts to all New York taxpayers, the federal tax plan will create a scenario in which 3.3 million New Yorkers - the vast majority of whom are middle class - will be double taxed.

Today, Governor Cuomo reiterated New York's plan to file a lawsuit if this provision passes on the basis of double taxation. Eliminating deductibility targets middle class New Yorkers - a breakdown of the impact by income bracket is available here.

New York State is again hit hardest of any state by the federal tax plan's inclusion of this provision, according to data from the Tax Foundation. Just five states - California, Illinois, New Jersey, Massachusetts, and New York - make up 50 percent of the revenues required to support the federal tax plan. The federal government's tax plan deliberately makes New York less competitive than other states to attract people and businesses.

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For Immediate Release: 10/3/2017
GOVERNOR ANDREW M. CUOMO



VIDEO, PHOTOS & RUSH TRANSCRIPT: GOVERNOR CUOMO ANNOUNCES DEVASTATING IMPACT OF TARGETED FEDERAL ATTACKS ON NEW YORK STATE - COSTING OVER $21 BILLION ANNUALLY

1: The Defeated Graham-Cassidy Bill, Which Would Have Cost NYS $16.9 Billion by 2025 - the Most of Any State - Must Not Be Resurrected

2: Federal Cuts to DSH - Will Cost $2.6 Billion, Falling Hardest on Neediest Patient Populations

3. $1.1 Billion Cut to CHIP - Jeopardizes Health Care for 330,000 Low Income New York Children

4: The Proposed Federal Tax Plan, Which Eliminates the Deductibility of State and Local Taxes, Costing NYS $17.5 Billion Annually - the Most of Any State - Must Be Stopped

Governor Cuomo Mobilizes Coalition to Work with New York's Congressional Delegation to Stop Cuts


Earlier today, Governor Andrew M. Cuomo outlined four major federal cuts, totaling more than $21.2 billion annually, that are part of policies targeted to directly hurt New York State- devastating state and local governments, straining public and not-for-profit hospitals, and jeopardizing quality healthcare for more than 3 million New Yorkers. Moreover, the cuts to New York State are disproportionate to the rest of the country - even as New York is the number one state contributor to the federal government, sending $48 billion more to Washington each year than is returned. Given the devastating impact of the federal government's reckless policies, Governor Cuomo mobilized a coalition to work with New York's Congressional Delegation to fight back and stop the cuts.

VIDEO of the event is available on YouTube here and in TV quality (h.264, mp4) format here.

AUDIO of Governor Cuomo's remarks is available here.

PHOTOS of the event will be available on the Governor's Flickr page.

A rush transcript of the Governor's remarks is available below.

Thank you for taking the time to come. I think you know everyone who's at the table. To my left we have Mr. Jason Helgerson, then we have Robert Mujica, then our great Howard Zucker, Commissioner of Health.

I want to run through a few facts and a presentation and whatever questions you might have and I want to talk about federal assaults on the State of New York that would have a devastating effect and a disproportionate effect on the state. And you've seen over the past several months a number of individual initiatives that have come out, each in their own right would be problematic for the state, but when you take a step back and you look at all of the proposals, there's a pattern. The loss to the State of New York is grossly disproportionate and these programs would have the harshest cuts on the State of New York and I want to speak about four of them quickly.

The Graham-Cassidy Bill, which was Congress's last attempt to repeal the ACA would have cost New York State between 40 and 60 billion dollars by 2026 and in essence it penalized states that expanded Medicaid. It would have cost New York State more than any other state in the United States at $60 billion. Luckily, it was a national effort, a national outcry, and Graham-Cassidy failed last week. I hope it doesn't come back again through the Lazarus project but make no mistake, repealing Obamacare is an essential political plank for this congress and I would not be surprised to see it come back again. The health care cuts to what is called the DSH program, D-S-H. DSH is the Disproportionate Share of Hospital payment program. A little background on this program: it was proposed in 2010, it was never implemented by the Obama administration, through this program the federal government provides funding to New York State and New York State law then distributes that funding. The payments essentially reimburse hospitals for uninsured and Medicaid losses on a periodic rolling basis. Sunday, October 1, was the deadline to stop the cuts from happening. October 1 has come and gone and the cuts are now law. In the next 18 months it will cost the state $1.1 billion, $2.6 billion when fully phased in. It hits, once again, New York State harder than any state in the country, the amount of federal loss to New York. It's also disproportionate. New York loses $2.6 billion, California $1.2 billion. Sixteen percent of the entire cut is borne by New York State.

What DSH does is it has a funding formula which is in the state law. First, the funding goes to private hospitals to cover expenses up to a legal cap which is approximately 25 percent depending on the hospital. Then the remaining money goes to fund public hospitals if the local government puts up the federal match and then the funding goes to all public hospitals to reimburse them up to 100 percent of the Medicaid and uninsured loss. The current $1.1 billion DSH cut is so drastic that it will not allow us to fund any public hospital at 100 percent. The public hospitals that are affected are in Erie, Nassau, SUNY Upstate, SUNY Downstate, SUNY Stony Brook, HHC, and Westchester. These are federal cuts to local governments and their hospitals. They are not state cuts. We have not reduced our budget by a penny. It's the amount the amount of money the federal government is giving us to use that we redistribute through a formula. The cuts hurt New York State also because SUNY operates hospitals. We fund SUNY. SUNY Upstate, SUNY Downstate, SUNY Stony Brook, we will bear those cuts through the state university system. The cuts are real. They are in effect. You know, for so many years we heard about them, we talked about them. All the experts said, "don't worry, the federal government would never let this happen."

Well, the federal government let it happen. There's no way to fund the public hospitals with a $1.1 billion cut unless it is rolled back. In the meantime, we have made no DSH payments to any public hospitals since October 1, which is when the law went into effect. You can't distribute funding until you know how much you have to distribute. All hospitals will need to find savings and local governments and state government will need to find ways to work with these hospitals to make ends meet because if this stays in place, again - we won't get to 100 percent funding. State law says that if there is a Medicaid cut which is over $850 million dollars, the state - the administration - comes up with a plan on how to allocate those cuts, and the legislature then has a right to approve or disapprove that plan. As this cut is $1.1 billion, if it goes into effect, we would have to do such a plan. We've engaged KPMG to analyze the finances of the situation, to look at the hospitals, to look at their relative positions. We will reconvene the MRT program - Medicaid Redesign Team - which was very successful several years ago in coming up with ways to save funding.

There's a slight unknown in all of this. Some members of the congressional delegation believe the cuts will be restored by December 31. That would be great and we should all pray for that. If we know the cuts will not be restored by December 31, I'm considering calling a special session to bring the legislature back, because they would have to change the law on the distribution of the DISH funds, as the DISH amount has changed. If the law is still in effect on December 31, we'll pass a new distribution formula in the state budget.

Local governments, hospitals, patients and medical professionals are all very upset about this, as they should be. Public hospitals are stressed already. Public hospitals take care of the most needy patients. We have to get the cuts rolled back, period. Otherwise there's going to be a lot of pain, and the only question is how you allocate the pain. So, we're going to be doing everything we can to reverse those cuts. I've been speaking to our congressional delegation and making clear to them how impactful this will be statewide to some of the hospitals that are already stressed, some of the local governments that are already stressed. Nassau County owns the Nassau Hospital. Nassau County has a financial control board. Erie County is not in a financial position to step up and bail out Erie Hospital. And New York State, frankly, has a $4 billion deficit. We're not in a position to step up and bail out SUNY Upstate, SUNY Downstate and SUNY Stony Brook.

Third, is health care cuts to what is called the CHIP program. I believe this is the most significant health issue for the people of our state, and it is the federal government assaulting, literally, the children of this state. 1990, the State of New York under a Governor named Mario Cuomo came up an innovative program called the Child Health Plus Program, the first of its kind in the nation, where the state insured financially needy children. 1997, President Bill Clinton took the program national, and it's now called the CHIP program - Child Health Insurance Program. CHIP insures families, children in families with incomes up to 400 percent of the poverty level, covering those who are not eligible for Medicaid. Eligibility is up to 18 years old. 330,000 children are insured in the State of New York through the CHIP program. Total cost of CHIP is $1.2 billion. On October 1, CHIP ended, the same day that the DISH program ended. States are starting to unravel their CHIP programs. So Minnesota, Utah, Nevada - they believe this is fait accompli, and they are unwinding their CHIP program. If we unwound, aborted our CHIP program, that's 330,000 children without any medical coverage. On the other hand, if New York continues it, it would cost the state $1 billion to continue CHIP without any financial assistance from the feds. That is on top of all the other cuts they're trying to impose. Informed sources say even if it's renewed, they will probably reduce the amount of reimbursement under CHIP, which would be a problem. The CHIP cut is actually worse than the DSH cut. DSH is $1.1 billion, but it's over five different governments and 25 different hospitals, so the pain is spread out more, if you will.

The CHIP program, if we continue it after the feds pull out, that's $1 billion directly to the State of New York without any sharing from any of the local governments because we pay for that directly. Again, 330,000 children, why a government would want to end health insurance for 333,000 children is beyond me and we use the word draconian and I think that's a fitting word. It's a draconian action. These are real life people with names. We know who they are, we know we they live, we know where they are in the state and congress must restore the CHIP program. You know, I don't care if you're a Democratic congressperson or Republican congressperson, you represent those 330,000 children. They are in everyone's district and I want to see the congressperson who goes home and goes to town hall meetings and say, "Yes, I ended health insurance for children under 18 years old. I cast that vote." I dare them. We will hold every member of congress accountable. I promise you that.

Last piece is the federal tax plan. The proposed federal tax plan eliminates the deduction for state and local taxes. That would cost New York $17.5 billion annually. For New York State, this is not a tax cut, it's a tax increase for many New Yorkers. 3.3 million New Yorkers will be double taxed. The way deductibility works is you pay your state and local taxes, you then deduct it from your federal income tax. This would say you can no longer deduct it from your federal income tax and your federal income tax would tax you on your taxes. It affects the entire state. We have some of the highest property taxes in the United States and this compounds it. Nassau, Westchester, highest property taxes in the United States of America. This now taxes that already high property tax. Upstate New York, highest property taxes by percentage value, this now taxes that property tax.

It is in attempt by the federal government, purposeful or coincidental, to make New York and several other states actually less competitive for businesses and people. Once again, the tax plan hits New York harder than any other state. Just five states make up 50 percent of the tax increase. It is the federal government putting New York specifically at a disability and giving the other states a completive edge. If you raise our taxes, you make New York less competitive. We work for seven years to bring down taxes, bring down spending, become more business friendly. This would do the exact opposite. Not to mention, this is trickle-down on steroids, right? This is the classic Republican playbook. We cut taxes on the rich and corporations to the tune of $340 billion. They will then go out and stimulate the economy so middle class folk and working class folk will have jobs and can eat the crumbs from the table.

We believe the new federal tax plan, if it goes through, is double taxation and we will sue the federal government if they do that. So, when you step back and look at what they've been proposing over the past several months, New York would have taken the largest cut under Graham-Cassidy. New York takes the largest cut under the DSH program, New York takes the largest cut under the CHIP program, New York takes the largest cut with the elimination of state and local deductibility. And to make matters worse, New York State contributes more money to the federal government than any other state. We sent $48 billion to Washington every year, more than what we get back. $48 billion. The comptroller said in a report today which had about the same number.

So we are the number one contributor to the federal government and they are hitting New York hardest in terms of the losses. DSH cuts would cost $2.6 billion, CHIP cuts would cost a billion, federal tax would cost $17 billion, over $20 billion lost to the state of New York. It would end health insurance for the needy children, it would attack vulnerable patients in public hospitals, force public and safety net hospitals to make even more cuts, stress local government to support public hospitals, it would stress our state budget, remember we start with a $4 billion deficit before any of these cuts, and it's a tax increase on New Yorkers when you don't allow them to deduct their state and local taxes. It is grossly unfair, it has to be stopped, and all of it has to be stopped. All four actions. We're going to do everything we can to lobby and stop these cuts, I think once people understand what this is all about they will be supportive. Once they see the injustice and the unfairness, I think they will be supportive.

We've been talking to the congressional delegation, they get it. Again, I don't care if you're a Republican congressperson or a Democratic congressperson, this is very simple: are you more loyal to your political party boss or are you there to represent the people in your district? This hurts people in their district. This hurts children in their district. This raises taxes on the people in their district. This hurts the public hospitals in their district. They have a choice to make. And I understand, it's a party discipline among the republican extreme conservatives, well either you vote with a party boss or you vote with the people who elected you. It's that simple. We will sue on the deductibility provision if it stays in at the end of the day and I promise you that the fight has just begun. We're not going to allow this state to be attacked and assaulted grossly and unfairly. We're not going to allow this state, which is the number one contributor to the federal government, and rather than saying, "Thank you," they come back with every policy targeted right at the heart of New York. That's the case we'll be making over the next several weeks.

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