Remarks at HANYS Annual Meeting
June 23, 2010
President & CEO
The Business Council of New York State, Inc.
A thank you to Dan Sisto for inviting me to join you this morning.
As a result of federal health care reform, something has changed regarding my participation here. This occurred to me as I drove up the Northway last night. It used to be that as a representative of the state’s business community I’d come to this meeting and, in urging you all to lower your costs in order to lower the exorbitant health insurance premiums our Business Council members pay, I’d feel like I was on the other side of the table. It often felt somewhat adversarial.
No more! Thanks to federal health care reform in Washington, we are clearly now all in this together. Yes, we’ve got a new alliance of bedfellows deeply concerned about those Medicaid beds.
Dealing with Medicaid going forward is huge issue to New York’s business community. The levels of spending on the current program are unsustainable and cost employers in terms of their own health care coverage, their property taxes and ever-increasing taxes and fees levied by Albany in order to reduce state budget deficits caused, in large part, by runaway Medicaid spending.
Employers are asking, how can we reduce spending when we have federal health care reform that says we need to maintain the level of services New York already offers, but then provides no funding for those services?
Businesses believe that the “wish list” in federal health care reform could make a bad situation worse here in New York State. Based on the views of many health economists it appears the federal law is underfunded and overpromised. And it will put more upward pressure on commercial health premiums to meet the coverage mandates.
We had hoped that federal health care reform would focus on lowering costs, but instead its focus was increased coverage and access, insurance reform and costly mandates.
At the Business Council, we know that you will be facing real challenges with the impact of the federal law on hospital financing —
- Reduced Medicaid trend factors estimated as a $7.7 billion hit over 10 years to NY hospitals.
- A $4.5 billion reduction in disproportionate share hospital payments over 10 years.
- And the bundling of payments where you will have new challenges.
- All in the context of a federal mandate that states continue their current benefit levels.
So we cannot simply wait for a solution, we will need to create our own solution.
We need to find ways to bring together payors, providers and employers to start a conversation to see what local and regional changes can be implemented to lower costs in spite of these federal and state pressures.
We can look to models like the Rochester Business Alliance’s Health Care Planning Team, which several Business Council members, especially Wegman’s, have been very involved in.
We need to find ways to lower costs by better managing chronic diseases and by providing care and managing heath care assets in the most efficient way possible.
Dan, I think it’s pretty clear: We can’t wait for Washington or Albany to devise a solution for us. We are all in this together and we are going to have to do it for ourselves. At the Business Council, we look forward to working with you.