Official: State should pick up counties’ share of Medicaid

PHOTOGRAPHER: David Lombardo

State Sen. Roy McDonald wants counties to stop paying for Medicaid, even though he doesn’t know how the state would cover the more than $7.3 billion in funding they now provide.

McDonald, R-Saratoga, is part of a bipartisan coalition that proposed legislation in both chambers of the state Legislature that would gradually eliminate the counties’ role in paying for Medicaid. Currently, the federal government funds about half the program in New York and the remaining cost is split between the state and counties. If it passes, the legislation would go into effect in the third quarter of 2012, with the counties’ share reduced by 5 percent, and be fully implemented in 2019, when the state would take over its share completely.

Outside of New York City, the counties primarily fund their portion of the Medicaid bill through property taxes. McDonald is hoping to ease taxpayers’ burden. He said recent efforts to provide property tax relief have been a mixed bag. He said the state’s property tax cap is a step in the right direction but wasn’t accompanied with enough mandate relief.

“You have a tax cap, but you have to recognize that counties have all these mandates,” McDonald said. “[Medicaid] is an area that’s a big one. It’s the big enchilada.”

According to numbers provided by McDonald’s spokesman, Medicaid is the largest required item in nearly every county budget and on average accounts for about 45 percent of a county’s property tax levy.

Schenectady County Legislator Gary Hughes said the $33 million his county spends on Medicaid represents about half of its property tax revenue. If the county didn’t have this expenditure, he said, legislators could “convert it right into reductions for property taxpayers.”

In Montgomery County, Board of Supervisors Chairman Thomas Quackenbush said his past budget spent about $11 million on Medicaid and collected $23 million in property taxes.

He said the county has to make cuts in other important areas to pay for Medicaid. If that expense was eliminated, he said, “We wouldn’t have to diminish the services that are being considered in the future. Everything is in jeopardy [now].”

Saratoga County Board of Supervisors Chairman Tom Wood echoed those sentiments. He said the proposal will be a hot topic of discussion at the New York State Association of Counties’ ongoing meetings in Lake Placid. “This is more of a state responsibility,” Wood said. “It’s not something we volunteered for.”

McDonald said this change should have happened years ago and noted that it had been suggested as a priority this past session in conjunction with the property tax cap. Now he is hoping to get people talking about the issue so that the state Legislature can act on it in 2012.

“I’m excited. This is what we should be doing. This is what the public wants us to do,” McDonald said. “If we don’t do this, I think they’re going to see some of these counties flirt with bankruptcy.”

The question of funding is what Steve Greenberg, a pollster from the Siena College Research Institute, identified as the real challenge to reforming the state’s Medicaid system. “I do believe that this is not a left and right issue … as much as it is a fiscal issue,” he said.

“This concept of the state picking up Medicaid costs … has been around for at least 20 years,” Greenberg said. “The real question becomes how to do it. Where does the state come up with the revenue to do it?”

McDonald noted that New York and California are the only states that require a local Medicaid contribution.