The proof is in the details, these are some bold initiatives..

New York’s Spitzer Seeks Freeze on Hospital Payments

By Michael Quint and Henry Goldman

Jan. 26 (Bloomberg) — New York Governor Eliot Spitzer said he will try to bring health costs under control by freezing state payments to nursing homes and hospitals, stepping up scrutiny of health insurers and tightening rules on subsidies for doctor training.

Spitzer promised that his budget plan, due Jan. 31, will put the needs of patients ahead of the needs of hospitals, insurers, drug companies and labor unions.

“Those who have benefited from the status quo will fight hard to resist these necessary reforms,” Spitzer said in a speech at the Rockefeller Institute for Government in Albany. He vowed to “fight for what I believe is right and for the good of all New Yorkers.”

Eventually, Spitzer said he will develop a plan for affordable universal health insurance for the state. First, he said, health-care costs must be lowered, or else universal coverage will be too expensive.

A hospital industry spokesman said Spitzer was seeking “a quick fix” instead of “lasting reform.”

“We’re not against the goal of a patient-centered system that covers everyone and pays fairly and provides good Care” said Bill Van Slyke, spokesman for the Health Care Association of New York, which represents hospitals and nursing homes. “Cuts in Medicaid cost-of-living rates to hospitals and to workforce recruitment and retention have been rejected time and again because they didn’t constitute real reform.”

2002 Deal

The Democratic governor criticized a 2002 deal under which the state, then led by Republican Governor George Pataki, allocated $3 billion in health care funds for a hospital union labor agreement “with little or no accountability.” Spitzer didn’t seek the endorsement of the union, 1199 United Healthcare Workers East, for his election last November.

Leah Gonzalez, an 1199 spokeswoman, didn’t return calls for comment. Eileen Larrabee, spokeswoman for Assembly Speaker Sheldon Silver, a Democrat, said he had no comment. A call to a press representative for State Senate Majority Leader Joseph Bruno, a Republican, wasn’t returned.

“A patient-first program is exactly what is needed,” said E.J. McMahon, a director of the Empire Center, a policy research group in Albany that advocates lower government spending. He said the freeze on some Medicaid payments could be the most difficult proposal to implement, and that Pataki failed when he tried to impose similar limits.

Elizabeth Swain, chief executive officer of the Community Health Care Association of New York, a patient advocacy group, also supported Spitzer’s plan.

Medicaid Freeze

“It promises to put money into delivering services and away from places where money’s being wasted,” Swain said. “Over a period of years, we will see this policy creating community primary-care centers all across New York that will improve the population’s health while saving the state money.”

Medicaid, the health insurance program for the poor, accounts for about $45 billion in spending, or 40 percent of the state’s budget. Much is for “unsustainable and unwise” outlays to nursing homes and hospitals, Spitzer said.

Spitzer’s promised freeze on Medicaid rates paid to hospitals and nursing homes would be accompanied by a partial freeze on rates paid to managed-care plans used by patients. There would be no freeze on rates paid to home-care providers, he said. The state will also try to reduce the insurance premiums it pays for Medicaid patients in managed care plans.

The spending limits aren’t aimed at patients who use the program, said Denise Soffel, senior policy analyst at Community Service Society, an anti-poverty advocacy group.

Signing Up Uninsured

“We have been told by people in the administration that the budget won’t call for reductions in benefits, tighter eligibility standards or increased payments for co-pays,” Soffel said.

In his speech, Spitzer said the state will cut expenses for charity care, often in emergency rooms, by reducing the number of uninsured, now 2.6 million, or 14 percent of the population. He set a goal of providing all 400,000 uninsured children with access to an existing state health insurance program, partly by expanding eligibility. Swain said it would cover children in families of four with incomes as high as $80,000 a year.

Enrollment of eligible adults in Medicaid will be increased by easing procedures for annual renewals, which causes about 40 percent of those in the program to lose coverage every year.

Health insurance companies will be monitored more closely to end “gamesmanship that results in denial of care or delay in payment,” Spitzer said. Insurers will also be required to pay fair rates for service, so that hospitals and others aren’t using other revenue to subsidize insured patients.

Spitzer said he expects to save on pharmaceutical costs through increased use of drug guidelines and generics.

He also expects savings in funds given hospitals for training doctors. Those payments, including money for non- existent people, amounted to $77,000 per graduate resident last year, compared with $21,000 in California.

To contact the reporters on this story: Michael Quint in Albany, New York, at mquint@bloomberg.net ; Henry Goldman in New York at hgoldman@bloomberg.net