Leveraging MCO Tax Revenue for Patient Access

A significant opportunity lies in the state’s Managed Care Organization (MCO) tax revenue. HCFANY is advocating for a re-evaluation of how $1.4 billion of this revenue is distributed, arguing that a greater portion should be directly allocated to support patient care. Currently, this funding does not prioritize direct assistance to individuals seeking affordable healthcare.

<h3>Expanding Child Health Plus Subsidies</h3>
<p>One key recommendation focuses on expanding subsidies for the Child Health Plus (CHP) program. Eliminating premium cliffs – where families face a sudden increase in costs as their income rises – and aligning coverage start dates with the first day of the month would significantly improve affordability and continuity of care for middle-income families. Currently, families exceeding 400% of the Federal Poverty Level (FPL) can see annual premiums increase by approximately $3,000 per child. Aligning CHP with Medicaid and Essential Plan rules for coverage start dates would further streamline access.</p>

<h3>Addressing New York’s High Healthcare Costs</h3>
<p>New York consistently ranks among the most expensive states for healthcare. To address this, HCFANY proposes a three-pronged approach:</p>
<ol>
  <li><strong>Establish a New York Office of Health Care Affordability:</strong> Modeled after California’s successful Office of Health Care Affordability (<a href="https://hcai.ca.gov/affordability/ohca/" target="_blank" rel="noreferrer noopener">hcai.ca.gov</a>), this independent body would focus on cost containment and transparency.</li>
  <li><strong>Enact the Fair Pricing Act:</strong> Legislation (<a href="https://www.nysenate.gov/legislation/bills/2025/S705" target="_blank" rel="noreferrer noopener">S705</a>|<a href="https://www.nysenate.gov/legislation/bills/2025/A2140" target="_blank" rel="noreferrer noopener">A2140</a>) aimed at ensuring fair reimbursement rates for routine medical services, regardless of the care setting, is crucial for controlling costs.</li>
  <li><strong>Invest in Primary Care:</strong> Supporting the Primary Care Investment Act (<a href="https://www.nysenate.gov/legislation/bills/2025/S1634" target="_blank" rel="noreferrer noopener">S1634</a>|<a href="https://www.nysenate.gov/legislation/bills/2025/A1915/amendment/A" target="_blank" rel="noreferrer noopener">A1915A</a>) will improve patient outcomes and address health inequities by strengthening primary care services.</li>
</ol>

<h3>Protecting Access Amid Federal Uncertainty</h3>
<p>Recognizing the potential for federal healthcare cuts, HCFANY advocates for the creation of a principal reserve fund – a “rainy day fund” – to protect access to care. This fund could be vital in maintaining coverage for lawfully present immigrants if federal funding for Medicaid is reduced. What steps can New York take *now* to proactively mitigate the impact of potential federal policy changes?</p>

<h3>Strengthening Consumer Assistance Programs</h3>
<p>Increased funding for consumer assistance programs, such as Navigators and the <a href="https://communityhealthadvocates.org/" target="_blank" rel="noreferrer noopener">Community Health Advocates (CHA) program</a>, is essential to help New Yorkers navigate the complexities of the healthcare system and access available resources. These programs provide critical support to individuals and families seeking affordable coverage.</p>

<p>HCFANY’s complete testimony, detailing these recommendations and further analysis, is available <a href="https://hcfany.org/wp-content/uploads/2025/02/25_26-HCFANY-Health-Budget-Testimony.pdf" target="_blank" rel="noreferrer noopener">here</a>.</p>

<div style="background-color:#fffbe6; border-left:5px solid #ffc107; padding:15px; margin:20px 0;"><strong>Pro Tip:</strong> Understanding your healthcare coverage options can be daunting. Resources like the Community Health Advocates program can provide personalized assistance and guidance.</div>

Frequently Asked Questions About New York’s Health Budget

1. What is the potential impact of federal healthcare cuts on New York?

   Proposed federal cuts could cost New York State up to $10 billion to maintain current levels of health coverage for its residents.

2. How can the MCO tax revenue be used more effectively?

   HCFANY recommends allocating a greater portion of the $1.4 billion in MCO tax revenue directly to patient care, rather than other uses.

3. What is the Fair Pricing Act and how would it help?

   The Fair Pricing Act aims to ensure fair reimbursement rates for medical services, regardless of where care is received, helping to control healthcare costs.

4. Why is expanding Child Health Plus subsidies important?

   Expanding CHP subsidies would make health insurance more affordable for middle-income families and ensure continuous coverage for children.

5. What role do consumer assistance programs play in healthcare access?

   Programs like Navigators and Community Health Advocates provide crucial support to individuals navigating the healthcare system and accessing available resources.