New York State Awarded More Than $300 Million from Federal Government to Expand Medicaid Demonstration Programs

ALBANY, N.Y. (August 5, 2011) – State Health Commissioner Nirav R. Shah, M.D., M.P.H., today announced that the New York State Department of Health (DOH) will receive up to $345 million over a three-year period for initiatives to improve the quality, continuity and coordination of primary care that Medicaid patients receive at hospital outpatient departments operated by teaching hospitals, as well as at other primary care settings used by teaching hospitals to train resident physicians.

"New York is committed to meeting the health care needs of all its residents and is taking innovative steps to reform and reconfigure our Medicaid program to improve the delivery of quality care and control costs," Commissioner Shah said. "The new initiatives are critical elements in providing better care for patients at lower costs for taxpayers."

Through an agreement with the federal Centers of Medicare and Medicaid Services (CMS), New York will develop and implement two new initiatives to improve the care Medicaid patients receive in hospital outpatient clinics:

  • The Hospital-Medical Home (H-MH) project will provide financial incentives to hospital teaching programs to transform primary care teaching programs at hospital and community sites. Hospitals participating in the initiative must participate in at least two evidence-based quality and safety improvement projects and achieve certification by the National Committee for Quality Assurance as a patient-centered medical home (PPC®-PCMH™), a model to provide patients with improved access to high quality primary care services. ($325 million
  • The Potentially Preventable Readmissions (PPR) project will provide competitive grants to hospitals and/or collaborations of hospitals and other providers to develop strategies to reduce the rate of preventable readmissions related to medical or behavioral health conditions. ($20 million)

The agreement also includes increased financial support for mental health clinics that serve uninsured patients by providing federal funding to match state funds distributed through New York's Indigent Care Pool. This program provides grants to voluntary, non-profit and publicly-sponsored Diagnostic and Treatment Centers (D&TCs) for services delivered to uninsured individuals throughout the State. These programs will be authorized to operate through December 31, 2014.

New York's Medicaid program provides essential health care coverage to more than 4.2 million New Yorkers. As of April 1, 2011, there were 2.9 million New Yorkers enrolled in the Medicaid managed care program and more than 400,000 individuals in Family Health Plus.

These demonstration projects are supported through New York's federal Section 1115 waiver called the Partnership Plan. The Partnership Plan, which was approved by CMS in 1997 to provide access to quality health care, permits New York to mandatorily enroll Medicaid beneficiaries in managed care plans and, with federal approval, allows the state to reinvest the resulting federal savings in demonstration programs to improve access and quality of care.