State Medicaid Director Jason Helgerson said New York City Health + Hospitals will receive $360 million in funding previously withheld.
NYC Health + Hospitals asked for $387 million in disproportionate share hospital payments last month. State officials said $268 million was for fiscal years 2013-14 through 2016-17, while $119 million was an advance payment based on estimated 2017-18 spending.
In a letter to Stanley Brezenoff, interim president and CEO of NYC Health & Hospitals, Mr. Helgerson said the state will distribute the $268 million related to services from prior years, along with $92 million in scheduled DSH funding. The state will address the $119 million payment "when we have certainty as to the availability of future DSH funds."
The announcement follows federal cuts to DSH payments that took effect Oct. 1 and comes about a week after NYC Health + Hospitals announced plans to sue state officials over the DSH payments.
Last week, Mr. Helgerson wrote the letter to Mr. Brezenoff, saying the state "determined the annualized payment to each hospital and seek[s] to fund each hospital to their full annualized allocation" by the end of 2017.
"The federal DSH program's current funding level was cut on Oct. 1. Some in Congress hope to restore the program, but the state must operate on the current law," Mr. Helgerson said. State departments, "working with outside financial consultants, have completed a preliminary analysis of the DSH program. This final review of hospitals which are heavily dependent on DSH is expected to be completed by Dec. 1, 2017."
He added, "Funding under DSH is complex. Upon the implementation of the federal cuts, it was necessary to justify each hospital's fair allocation, regardless of the timing of the invoices they had submitted to date. We have determined the annualized payment to each hospital and seek to fund each hospital to their full annualized allocation by Dec. 31. Our priorities are fair allocations to all hospitals involved in the program, stability of the workforce and preservation of the highest levels of patient care."
Freddi Goldstein, a spokesperson for New York City Mayor Bill de Blasio, told The New York Times "we're reviewing the details of the state's reimbursement plan."