A colleague who is researching a story on New York has just informed me that the rumours I had heard about 1 in 5 New Yorkers being on Medicaid is untrue. The actual number is 1 in 3 New Yorkers, which goes a long way to explaining why the city is bankrupt.
New York is an interesting place. As you may or may not know, the states set the level of Medicaid spending, but the Feds match the states dollar for dollar. New York State decided that a good way to soak up extra Federal money was to require the local governments to match the state, dollar for dollar. Since the Feds match all state and local spending, this had the effect of doubling Medicare spending in the state of New York, at no cost to the state, other than the psychic anguish of its highly taxed citizens.
New York City is picking up 25% of the cost of each Medicaid recipient. By the end of 2004, the City Council expects Medicaid to cost the city $4 billion a year. That's $1650 per person, or a tax of over $200 on each non-Medicaid recipient to pay for their neighbor's healthcare. That's before they start paying for the rest of the city's lavish spending levels. Those billion dollar deficits seem a lot less surprising all of the sudden.
Posted by Jane Galt at November 29, 2004 03:24 PM | TrackBack | Technorati inbound linksFrightening stat. Any data available on how much of the Medicaid-serviced population is due to prudent estate planning rather than penury? I'd think that the former would make up a non-trivial amount of the "lucky" 1/3, but I don't know the numbers.
Posted by: Dr. Manhattan on November 29, 2004 03:50 PM"New York City is picking up 25% of the cost of each Medicaid recipient. By the end of 2004, the City Council expects Medicaid to cost the city $4 billion a year. That's $1650 per person, or a tax of over $200 on each non-Medicaid recipient to pay for their neighbor's healthcare."
But if 2 out or 3 residents are not on Medicaid, isn't the tax $825 per each non-Medicaid receipient, not $200?
Posted by: Hari on November 29, 2004 04:54 PMWhen the Medicare trend meets the reverse migration of the NYC Elderly it's only going to get worse!
Posted by: Michael Tinkler on November 29, 2004 05:29 PMAren't matching grants from the Feds just wonderful. In my state the state politcos get a $1 worth of political goodwill for every 30 cents in state dollars they spend (and a full $1 worth of complaints every time they try to reduce Medicaid).
Now that you got the hang of the spending, check out the federally mandated healthcare benefits that Medicaid recipients receive. They have by far the best medical coverage available.
Another "shocking" statistic: In my state 46% of all births are paid for by Medicaid.
Posted by: Bendedict on November 29, 2004 06:00 PMWhoa, people -- keep in mind that Medicaid is the state system for poor people, while Medicare is the federal system for retirees. And there is quite a bit of flexibility in the level of Medicaid the state decides to offer. The feds provide a range of permissible services, i.e., from minimum health care to maximum health care. Guess which level the New York system is at? Most states don't have the excessive expenses that NY does because they offer a Ford Escort version while NY offers a Cadillac.
Posted by: Rex on November 29, 2004 06:27 PMInteresting statistic. But can't we pick a better bogeyman for New York's ills, such as public education? I'm feeling very hostile to the teachers' unions.
Posted by: Dave on November 29, 2004 07:03 PM"New York State decided that a good way to soak up extra Federal money was to require the local governments to match the state, dollar for dollar."
Seems to me that this is actually a very good idea. Without this type of provision, we would have NYC residents clamoring for additional state spending on Medicaid, which would disproportionately benefit NYC (since a dispropostionate number of Medicaid recipients live in NYC). With this provision, to get disproportionate aid, the City would residents would be taxed disproportionately, thereby creating the correct incentive structure (yeah, NYC residents can push for more state aid (which disproportionately benefits them) if they want, but they better think long and hard about it, since they would have to pay disproportionately for it.)
I am, BTW, a NYC resident, paying those incredibly high local income taxes.
Posted by: Al on November 29, 2004 08:40 PMVictims of 9/11 might provide a reason for this ratio. My cousin has not been able to work since that time. It seems odd that you would attribute this to any form of poor planning and spending. It is amazing that after 9/11 when the US defense forces and the Federal Government threw NYC under the bus not one lawyer in NYC would sue the Federal Government for cession from the Union for failur to provide a defense. The fact that NYC voted for Kerry is not an open door to beat it down as liberal strong hold or not financial sound. This trashing of NYC seems to remind me of when the City was in need Gerald Ford told NYC where to go. So what new the Republicans have a majority are they going to spend this mandate on ignoring issues like big cities or are they going to expand their mandate to include complexed issues like Urban enviroments. Its easy to throw away $1billion on Iowa farmers welfare program or on any farm program and say the medicaid is due to poor planning or incentives. Take away the farmers welfare and the oil incentives and see how many people in Iowa and Texas use medicaid. Take away the federal portion of the state highway funds and see if you can even drive to these states in ten years. NYC is a vast complex of infrastructure that has paid its fair share in taxes and in its citizens lives for defense of this nation and in its hour of need was left to rot once by Gerald Ford then by Bush during 9/11. NYC's illness starts in Washington DC. If NYC could remove itself from the parasitic Federal Government it might have a chance. NYC should pickup 100% of the cost and not pay any Federal Taxes or State Taxes run the program without their guidelines and establish a tax free zone. The contribution to the State and Federal taxing authorities and what NYC recieves makes the State and Federal guidlines unjust and unreasonable. Basically NYC could run the program cheaper without any help but since they take the Federal and State contribution they must follow those guidelines.
Posted by: James Nesfield on November 30, 2004 06:27 AMLike so many other blue states, doesn't NY put more tax dollars into the DC Treasury than it takes out?
Posted by: Boonton on November 30, 2004 10:29 AMBoonton - sure, but so what? It's not a zero-sum game. In this case both sets of taxpayers lose, financing each other's wasteful spending projects.
Posted by: Yaron on November 30, 2004 11:02 AMYup. NYC's budget woes are 90% Pataki's fault (mind you, Bloomberg has worked to -increase- local Medicaid enrollment through his term, making things worse). What's going to be done about it? Nothing. Pretty much the entire state gov't is in the pocket of 1199/SEIU, the monster it itself created.
I'd say "ha ha" except I have to live here.
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It is more cost effective for the city to increase its Medicaid enrollment. Otherwise, city hospitals would have to pick up the full tab for people without any health insurance making use of the city's emergency rooms. And emergency care is far more expensive to the city than preventative care.
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Medicaid figures for 2000 show the state with the highest percentage enrollment was Tennessee (27%), followed by DC, Vermont, California, New Mexico, Mississippi, West Virginia, South Carolina, Arkansas, and Lousiana (18.5%), to list the top 10.
Oh, but this post wasn't about Medicaid, it was about how terrible NYC is. Sorry, just realized I'm off-topic.
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