Dissention In the Ranks
Questions Raised Whether Medicaid Team Can Make the Cuts

As the March 1st deadline for the Medicaid Redesign Team’s recommendations nears, doubts grow as to whether the team will be able to come to a consensus on their cutting mandate. In an interview posted on CapitalTonight.com, Assemblyman Richard Gottfried said the team is unlikely to meet Governor Andrew Cuomo’s deadline of cutting $2.85 billion from next year’s budget. Without team consensus, the newly appointed State Health Commissioner would be empowered to make the reductions.

“I do not believe we will be able to come up with $2.85 billion in savings that can be realized this year,” the Assemblyman said, according to published reports. Established by Executive Order #5, the 27-member Medicaid “dream team” was unveiled in the Governor’s State of the State address and charged (as part of the Executive budget) with finding $2.85 billion in savings in FY 2011-2012 and $4.6 billion in FY 2012-2013. Earlier this week, DOH asked the Team to rate 49 key proposals, which are a subset of a list of ideas submitted to the Department from various sources. The Team had until noon today to submit its ratings. The results will be tabulated and presented at a February 24th meeting in Albany.

According to the Team website, the 49 proposals were selected due to major fiscal or policy implications. The proposals do not represent the recommendations of DOH, nor do they represent any final recommendations of the Medicaid Redesign Team. Using a member Feedback Tool, redesign team members rated the 49 proposals on five indicators: quality, efficiency, overall impact, savings for year 1, and savings for years 2 and 3. The $2.85 billion Executive cut proposal met with criticism from Team members at the outset.

“I am gravely concerned about the expectation that the Governor’s Medicaid Redesign
Team can identify alternative reforms to substitute for this level of reduction,” HANYS President and team member Dan Sisto said following the February 1st Executive Budget release. “The Medicaid Team does not need more health experts. It will require alchemists, not policy wonks or providers, to transform cuts of this magnitude into gold.”

Included among the 49 proposals are initiatives to:

► Eliminate the 2011 1.7 percent inflation-factor increase for hospitals, nursing homes, home care, and personal-care services.
► End Level 1 personal-care services, including housekeeping, shopping and meal preparation, and set provider-specific annual per-patient spending limits at the spending level of five years ago.
► Change the way the preferred drug list is developed; allow prior authorization under the Preferred Drug Program (PDP) for the following drug classes: antidepressants, atypical anti-psychotics, anti-retrovirals and immunosuppressants; and limit the number of brand name prescriptions that a beneficiary could receive to five (5) per month.
► Mandate selection of a Medicaid Managed Care plan as a condition of eligibility for Medicaid recipients in counties with mandatory enrollment.
► Assign primary care providers to Medicaid enrollees.
► Create a neurologically impaired infant medical indemnity fund and establish a cap on non-economic damages in medical malpractice cases in addition to exploring alternatives such as disclosure and early settlement and judge-directed negotiations.
► Eliminate or limit coverage of dentures for adults.
The Redesign team will meet in Albany, on Thursday, February 24th at 10:30 a.m. to discuss the ratings. It is scheduled to meet again on March 1st to vote on the final cuts and submit the report to the Governor.

Governor Assigns Mid-winter Break Reading
Brings Education Reform Argument to the People

In an email message yesterday, Governor Andrew Cuomo urged his “Fellow New Yorkers” to focus on the facts instead of “overheated rhetoric” when considering his proposed education reform plan. He took the opportunity to outline his plan and offer suggestions on how school districts could efficiently compensate for lost State aid.


Earlier in the day, the State Education Department released the 2009-2010 school Report Cards detailing statewide, district and school statistics on enrollment; teacher qualifications; class size; test scores; graduation rates; and demographic data. Coupled with the Governor’s email, parents across the State have plenty to review next week while their children enjoy their Mid-Winter Break.

“Right now, we rank number one in the nation in spending per student, and number 34 in student achievement,” the Governor said. “…Throwing money at the problem is not the answer. We need to cut the bureaucratic fat and champion reforms that will help our students achieve their true potential.”

The Governor then explained his proposals to provide incentives for school districts in relation to performance and efficiency. Specifically, the Governor called for support of his proposed $250 million fund for competitive awards to school districts that have the greatest improvement in student performance and $250 million fund to reward school districts that produce the most innovative means to cut waste from the system.

In addition, he suggested ways that school districts can absorb reductions in State funding “without laying off teachers, cutting programs or harming students” including:

► Tapping reserve and unspent federal funds. School districts have $1.5 billion in reserves and unspent federal funds that will allow many to absorb the proposed $1.5 billion cuts without service reduction.
► Freezing wages, as I have proposed to do for state workers, would save school districts $1.1 billion.
► Having school district employees make the same health care contributions that state employees make would result in $500-$600 million in savings.
► Cutting the salaries of the more than 2,000 high priced school administrators who receive more than $150,000 in salaries and benefits would result in substantial savings.

(Governor’s email, February 17)
“…We can no longer afford to throw money at a system bloated with waste and inefficiency,” the Governor concluded. “By coming together and acknowledging that fixing our schools means placing the interests of our students ahead of special interests, we can make New York’s schools the envy of the rest of the nation.”

Meanwhile the 2009-2010 report cards include new data such as the percentage of core classes taught by "highly qualified" teachers. Core classes include English, math, science, social studies, art, music, and foreign languages. Highly qualified teachers are defined as those who have at least a bachelor's degree, are certified to teach in the subject area, and have demonstrated they are competent in the subject matter.

According to SED, Statewide, 3 percent of instructors were teaching outside their certification area in core classes last year, the same rate as 2008-09. In high-wealth districts, 1 percent taught outside their certification area last year, the same rate as the two previous years. In high-poverty districts, 10 percent were teaching outside their certification in 2007-08. That fell to 8 percent in 2008-09 and 6 percent last year.

The number of teachers statewide was down 1.7 percent ( 3,757 ) last year, to 219,333.
A greater proportion of the teachers had master's degrees (36 percent) in 2009-10, compared to 2008-09 (34 percent). The number of paraprofessionals increased from 67,568 to 79,270, a 2.5 percent increase.

For the Record – Pension Reform
City Council Speaker Christine Quinn

“ But if we want to have money to invest in a safe and livable city – if we want to avoid a tax burden that stifles economic growth – and if we want to safeguard the retirements of the hard working public servants of today – then our current pension and benefit structure is simply not sustainable.

I urge both the Mayor and our city’s labor leaders to be equally open to negotiating and making fair and responsible changes to meet the difficult challenges ahead.”
(State of the City Address, February 15)

Mayor Bloomberg’s Cry for Help

Mayor Michael R. Bloomberg this week unveiled his 2012 Preliminary Budget, calling for help from Albany to bring the City back into balance.

The Mayor’s $65.6 billion spending plan relies on $5.2 billion in savings generated though nine rounds of cost cutting actions taken by City agencies, additional tax revenues generated by the City’s continually improving economy, and a $600 million infusion from the State.

“City tax revenues are forecast to grow above previous projections, increasing from $39.0 billion to $40.0 billion in FY 2011 and from $40.8 billion to $41.9 billion in FY 2012, producing an additional $2.1 billion in revenues,” Mayor Bloomberg explained. “The increase in revenues was driven by economically sensitive tax revenues, which include personal income, sales, business, and real estate taxes.”

Despite the City’s strengthened financial footing, the Mayor’s plan still includes layoffs and service cuts and threatens more if Albany does not provide an additional $600 million in revenue.

For example, the Mayor’s plan calls for a total reduction of 6,166 teaching positions
(including 4,666 via layoffs); the elimination of senior center and day care funding; closure of 20 fire houses; and the loss of 5,500 Summer Youth Employment slots. According to the Mayor, “the Preliminary Budget relies on three changes at the State level to achieve a balanced budget and avoid further cuts in services” including:

► Equitable Distribution of State Revenue Sharing Funds – $200 million.
► Reform of the Variable Supplement Fund – $200 million. The Variable Supplement Fund provides a guaranteed annual $12,000 payment to non-disability retired members of the New York City Police and Fire Departments.
► Additional State Education Aid – $200 million,
If the actions above are not taken at the State level, the Mayor, explained, the City will be forced to initiate a new round of agency gap closing actions to save $600 million.

In Brief

Amtrak Hopes to Go Wireless
Budget Cuts Threaten Expansion

Amtrak trains on the Empire Corridor are in line for free Wi-Fi service sometime this year, an Amtrak spokesman confirmed this week. However, the exact date for the debut is in question due to possible federal budget cuts. According to the National Association of Railroad Passengers, the House Appropriations subcommittee has proposed a budget that would force Amtrak to delay or cancel the Wi-Fi program.

Governor Calls for MWBE Team

Governor Andrew M. Cuomo this week issued an executive order establishing a team to explore ways to meet his goal of expanding minority- and women-owned business enterprise (M/WBE) participation in state contracting to 20 percent.

Current M/WBE participation in the state’s contracting and procurement process is at 9.2 percent. A disparity study commissioned last year by the state Department of Economic Development identified numerous barriers including: commitment from agency leadership to meeting M/WBE goals; access to information; specificity in contracts regarding M/WBE participation; assistance and supportive services programs; obstacles in credit and bonding that lead to difficulty in securing state contracts; and inconsistent and infrequent monitoring and compliance during contract period.

The team, chaired by former New York City Comptroller William Thompson, will be comprised of: state agency heads managing M/WBE programs; members of the state senate and assembly; representatives of companies actively involved in supplier and workforce diversity contracting and inclusion practices; recognized experts in M/WBE implementation; and representatives from New York state academic institutions.
Class of 2011 job market improving

More members of the class of 2011 are expected to be hired than this year, as compared to their class of 2010 counterparts, according to results of a survey conducted by the National Association of Colleges and Employers.

Using a 0 to 200 hiring index scale, with 100 representing no change and scores below 100 representing a decrease, the Association said recent college graduates have a 126.4 rating, compared to 86.8 at this time last year.

According to another NACE survey, employers are most interested in hiring new college graduates with bachelor's degrees in business, engineering and computer science. Specifically, finance, electrical engineering, computer science, mechanical engineering and business administration were cited. In addition, nearly 62 percent of the organizations surveyed cited plans to hire accounting graduates.

Coming Up

New York State & New York City
No legislative meetings/hearings scheduled.
_________________________________________________
The next issue of This Week in New York will be published on March 4, 2011.
_________________________________________________
Disclaimer: The materials in this This Week in New York report are provided for informational purposes only and are not intended to be a comprehensive review of legislative or governmental or political developments, to create a client-consultant/lobbyist relationship, or to provide consulting, lobbying or political advice. Readers are cautioned not to attempt to solve specific problems on the basis of information contained in this This Week in New York. If consulting, lobbying or government relations advice is required, please consult a professional expert in such matters. The information contained herein, does not necessarily reflect the opinions of Pitta Bishop Del Giorno & Giblin LLC, or any of its partners or employees or its clients. Neither Pitta Bishop Del Giorno & Giblin LLC, nor its partners or employees make any warranty, expressed or implied, and assume no legal liability with respect to the information in this report, and do not guarantee that the information is accurate, complete, useful or current. Accordingly, Pitta Bishop Del Giorno & Giblin LLC is not responsible for any claimed damages resulting from any alleged error, inaccuracy, or omission. This communication may be considered an advertisement or solicitation.

To Our Clients: If you have any questions regarding any of the matters addressed in this newsletter, or regarding any legislative, government relations or political or consulting or related issues in general, please contact the Pitta Bishop Del Giorno & Giblin LLC professional with whom you usually work.

To Our Clients and Friends: To request that copies of this publication be sent to a new address or fax number, to unsubscribe, or to comment on its contents, please contact Theresa Cosgrove at tcosgrove@pittabishop.com or at (518) 449-3320.
______________________________________________
This Week in New York is a publication of Pitta Bishop Del Giorno & Giblin LLC, 120 Broadway, 28th Floor, New York, New York 10271.