New York state may assume bigger chunk of Medicaid bill

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Budget advisors for New York Gov. George E. Pataki said on Tuesday they are considering a plan to increase the amount the state contributes to New York's skyrocketing Medicaid costs, costs currently shared by the state, local and federal governments.

The plan to rein in state-mandated Medicaid costs would likely include cuts in Medicaid payments to providers, including hospitals and nursing homes, according to information released by the governor's administration.

Key provisions of the plan would be to place a cap on local governments' share of Medicaid costs, something local government officials have been urging state lawmakers and the governor to consider for the past several years.  Specifically, local officials have requested a cap of the local share of Medicaid spending at 2003 levels. The cap would cost the state an estimated $1.8 billion over three years, local officials said.

The cap would require the state to assume any year-to-year increase in local Medicaid costs. Currently, local governments are responsible for the entire increase in local costs from one year to the next.

New York's Medicaid program has an annual budget of $42 billion and covers 3 million low-income and poor residents.