Spending Watch


Bulletin #3: April 29, 1999
Health care being 'slashed'? We've heard it all before

The health-care lobbyists and unions are working overtime to convince New Yorkers and their elected officials that our health-care system will be at death's door, if state financing is reduced. The head of the Greater New York Hospital Association said recently that, as a result of funding reforms proposed by both Governor Pataki and President Clinton, "You're going to see massive service cutbacks" in hospitals.

Oh, really? It's hard to believe the sky-is-falling rhetoric, because we've heard it all before.

In fact, in December 1989, GNYHA President Kenneth Raske called for a taxpayer bailout of $300 million, saying: "If we do not get it, I absolutely forecast major layoffs and service shrinkage." Despite major changes to Medicaid, hospital employment across the state grew by more than 25,000 in the next few years. It's declined modestly each year since, but is still around the 1988 level. Still, virtually every year, GNYHA has repeated its apocalyptic claims, with words such as "nightmare," "disaster," and "people will die."

This year, Mr. Raske told the Legislature's fiscal committees: "We are on the edge of an unprecedented fiscal collapse of New York State hospitals." (And, he added: "In my professional life I have never predicted that.")

Our health-care spending is just too high, by any measure

The truth is, we can control spending and provide quality health care. Our current Medicaid spending is so high, it defies explanation. Not only does New York spend more on Medicaid than any other state - on a per-capita basis, we're 58 percent above the second-highest! Surely we can find savings in all that spending, while maintaining and even improving our health-care system.

Medicaid isn't the only issue, of course. The extra taxes created by the Health Care Reform Act of 1996 add more than $200 to an employee's monthly health-insurance premium in some areas of the state - on top of additional Medicaid taxes that support HCRA subsidies to hospitals. Our graduate medical education taxes have subsidized training for roughly 45 percent of all doctors in New Jersey, 34 percent of those in Connecticut, and 21 percent of Florida's.

Every other state maintains quality health care, and provides for true charity care, at far less cost than New York. It's time we change that.