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January 14, 2005

Council: Report on threat of Medicaid-driven county tax hikes intensifies need for Medicaid reform in Albany

County property taxes would have to increase by an average of almost one-third by 2010 if Medicaid costs continue to rise at the current rate, according to a new brief from state Comptroller Alan Hevesi.

“Medicaid costs are pushing already high local property taxes even higher. Although last year’s Family Health Plus takeover offered some relief, Medicaid costs are still a major burden for
county governments in New York State. In 2003, Medicaid alone amounted to 19 percent of county spending and equaled 73 percent of property taxes. Preliminary numbers indicate those shares continue to grow,” Hevesi said.

"Comptroller Hevesi's report adds urgency and insight on the need for Medicaid reform this year," said Business Council Vice President Ed Reinfurt, who has personal responsibility for the Council's Medicaid advocacy. "This will be a major test of whether legislators in 2005 will bring home the results that really matter to their businesses, taxpayers, and communities."

From 2004 to 2005, Medicaid costs are expected to increase 8.6 percent, a major factor in the 5.9 percent increase in total county spending that resulted in a 4.5 percent increase in property taxes, the Comptroller’s release said. .

The research brief analyzed the growth in Medicaid costs and total spending for counties since 1993, and projected future costs if current trends continue. Its finding include: