On January 18th, Governor Kathy Hochul submitted her first Executive Budget for New York State Fiscal Year (FY) 2023, which will run from April 1, 2022 to March 31, 2023, to the Legislature.
The Budget forecasts a strong financial position for New York, as a result of federal pandemic assistance, increased tax receipts compared to the Mid-Year forecast, and reductions in expense estimates (including decreases in pensions, debt service, and payroll expenses as well as significant savings in School Aid). The budget projects total spending of $216 billion, with a base surplus of $6.4 billion in FY 2023 and no remaining outyear budget gaps through FY 2027.
The Governor proposes to use the current year surplus to fund one-time initiatives, including bonus payments to direct care workers and tax relief for individuals and businesses, as well as to increase the State’s rainy-day reserve deposits to fund pandemic assistance efforts and to prepare for future economic uncertainties. The Governor has set a target of bringing the balance of the State’s principal reserves to 15% of projected State Operating Funds by FY 2025.
The Budget includes major health proposals outlined in the State of the State, including a $10 billion investment in health care (including wage supports, across-the-board rate increases, new capital funding, and other items); scope of practice expansion; telehealth parity requirements; and eligibility expansions for Medicaid and the Essential Plan.
Some notable new items include:
- Re-indexing the Medicaid Global Cap to a higher inflation factor;
- A reprocurement process for Medicaid managed care organizations (MCOs), which would establish between two and five plans in any region; and
- Moving oversight of health professions from the State Education Department (SED) to the Department of Health (DOH).
The attached summary provides further detail on these and other highlights from the budget’s Article VII legislation and appropriation bills. Where available, legislative sources are marked in [brackets].
The Article VII Health and Mental Hygiene (HMH) bill can be found here. The full FY 2023 budget materials are available on the Division of the Budget’s website here.