Testimony on Governor Hochul’s 2025-26 Budget Proposal

HCFANY is thankful to have the opportunity to testify at the 2025 Joint Legislative Budget Hearing on Health. Our fully detailed written comments are here. The Executive Budget includes many proposals to help protect and enhance New Yorker’s access to affordable health coverage. However, the current federal landscape on health care access is uncertain, as proposed cuts to federal health programs could cost the State $10 billion to maintain health coverage for New Yorkers (Learn how these federal threats affect New Yorkers statewide and by Congressional District here).  

The Managed Care Organization (MCO) tax revenue provides an opportunity for the State to ensure New Yorkers have access to and can afford health care. HCFANY urges the Legislature to consider alternatives to the distribution of $1.4 billion of this tax revenue, which currently does not include direct support for patients.  

HCFANY recommends:  

  1. Expanding subsidies for Child Health Plus to eliminate premium cliffs and align coverage start dates to the first day of the month of application.  

This would help ensure that middle-income families can afford their children’s health insurance. Once families surpass the 400% Federal Poverty Level (FPL) income threshold, their children’s annual insurance premiums increase by around $3,000 per child. Additionally, the State should follow similar rules as Medicaid and the Essential Plan for CHP coverage start dates. 

  1. Addressing New York’s expensive health care system.  

New York is ranked second in the nation for the most health care spending per person, and HCFANY proposes three solutions to remedy this: 

  1. Implement an independent New York Office of Health Care Affordability, like the model created in California.  
  1. Include provisions of the Fair Pricing Act (S705|A2140) to ensure consumers and payers are charged a fair reimbursement rate for routine medical services, regardless of where the patient gets care.  
  1. Improve patient outcomes and reduce inequities by including the provision of the Primary Care Investment Act (S1634|A1915A).  
  1. Creating a principal reserve or a rainy-day fund to ensure New Yorker’s access to care is protected from the threats of federal cuts.  

This funding could help keep lawfully present immigrants enrolled in Medicaid covered if the federal government cuts access to health insurance for this population.  

  1. Increasing funding for consumer assistance programs like Navigators and the Community Health Advocates (CHA) program.  

These are only a few initiatives that HCFANY is urging the Legislature to consider, please see our full written testimony here. 

On January 14th, Governor Hochul delivered her 2025 ‘State of the State’ address. HCFANY commends the Governor for proposing sweeping protections for consumers and patients across the State. Her proposals feature many HCFANY advocacy goals falling under six categories: (1) mental health, (2) reproductive health, (3) chronic health conditions, (4) prescription drugs, (5) dental health, and (6) improving insurance coverage. Her proposals plan to:

(1) Mental Health

  • Implement a teen mental health first aid program to equip youth with the ability to respond and address signs of mental health and substance use distress for themselves and their peers.
  • Introduce an initiative that connects youths to critical mental health resources during state-funded after-school programs.
  • Allocate new resources to strengthen compliance oversight and investigate more insurance complaints.

In New York, youth struggling with mental health has been on the rise; in 2023, 48 percent of teens experienced depressive symptoms ranging from mild (27 percent) to severe (11 percent) in New York. Through these proposed initiatives, the Governor hopes to provide basic skills for youths to support themselves and their peers and reduce the impacts of bullying and social violence. Additionally, the State aims to partner with the State University of New York to match social work graduate students with state-funded after-school programs to complete their required fieldwork and support vulnerable youths. 

The current law requires insurers to offer an accessible network of providers, pay at least Medicaid rates for in-network services, and reimburse school-based mental health services at Medicaid rates. Through her proposal, the Governor hopes to improve compliance oversight and investigate and find solutions to mental health care access needs and complaints.

We commend the Governor for her continued commitment to protecting youth mental health and proposing reforms to improve coverage for mental health care.  

(2) Reproductive Health

  • Expand funding for reproductive health care facilities to enable renovations and equipment upgrades to help providers deliver the full range of comprehensive services.

In New York, reproductive health care facilities often lack the proper infrastructure to provide the full range of comprehensive services needed. The Governor hopes to support these facilities through the Reproductive Freedom and Equity Grant Fund and security grant funding to ensure a broader network of providers can deliver quality reproductive health care throughout the State.

HCFANY is excited to see the Governor’s continued effort to ensure New Yorkers have access to reproductive care. Earlier this year, she announced a first-in-the-nation initiative to provide 20 hours of paid leave for prenatal care for privately employed, pregnant New Yorkers, both full-time and part-time.

(3) Chronic Health Conditions

Obesity is a significant concern for New Yorkers; in 2023, around one in three New Yorkers were found to be obese. This chronic condition increases the risk of diabetes, asthma, cardiovascular disease, cancer, and other chronic health conditions. Recently, GLP-1s have transformed obesity treatment, but many face cost barriers to this life-saving treatment. The Governor proposes to provide greater access to GLP-1 drugs for Medicaid members at high risk of cardiovascular events and pressure drug companies to lower prices.

The effects of climate change have increased the severity, duration, and frequency of extreme heat events, also known as heat waves, and these events are deadly for vulnerable populations with chronic health conditions. Heat-related deaths are more likely to occur at home, highlighting the importance of home cooling access. Last year, the Governor implemented an initiative to distribute air conditioners for Essential Plan members whose asthma poses a significant medical risk. Her proposal builds upon this by expanding eligibility to more individuals whose symptoms worsen through these heat events.

HCFANY applauds the Governor’s outstanding support for New Yorkers with chronic health conditions. These initiatives build upon the first-in-the-nation diabetes initiative that HCFANY supported, eliminating co-pays for insulin covered by state-regulated insurance plans, which went into effect this year. As of 2023, 1.8 million New Yorkers have been diagnosed with diabetes, and this initiative is estimated to save eligible New Yorkers up to $1,200 per year totaling around $14 million in 2025.  

(4) Prescription Drugs

The United States spends more on prescription drugs than any other peer country—like Australia, Canada, and France—with prices around two to four times higher for major brand-name drugs. A nationwide survey finds that 82 percent of Americans believe the cost of drugs is unreasonable, and over half of Americans worry about being able to afford their family’s prescriptions. Last year, a bill aiming to implement prescription drug importation program to lower costs (A7954A/S604) was passed in the Senate but fell short in the Assembly. Luckily, the Governor plans to participate in the Food and Drug Administration’s Section 804 Importation Program, which achieves a similar goal in importing low-cost drugs from Canada.

Additionally, the Governor is seeking to introduce a first-in-nation initiative to improve transparency and hold PBMs and drug manufacturers accountable to uncover any unnecessary costs they add to drug prices.

(5) Dental Health

  • Set minimum standards for dental plans available through New York’s insurance marketplace, New York State of Health (NYSOH).
  • Expand the scope of practice for dental hygienists.
  • Direct health plans to improve the availability of dental care.

It is well documented that dental care is essential to oral health, yet many New Yorkers face substantial barriers to accessing essential oral health services. HCFANY is thrilled to see the Governor’s proposal announcing plans to make minimum standards for dental plans available through New York’s insurance marketplace, New York State of Health (NYSOH)—an initiative that HCFANY has been advocating for.

The Governor also aims to introduce legislation to expand the scope of practice for dental hygienists and direct health plans to improve the availability of dental care.

(6) Insurance Coverage

  • Identify and address equity gaps in quality and outcome measurements for those on Medicaid Managed Care plans.
  • Create an integrated care system for Medicaid patients.
  • Perform a comprehensive review of the State’s network adequacy standards and increase enforcement of plan compliance.

In 1994, New York implemented Quality Assurance Reporting Requirements (QARR), which measure and report on health care quality. Though current Medicaid Managed Care (MMC) plans meet or exceed national benchmarks for quality measures, these measurements from QARR cannot identify health inequities within the population. The Governor has proposed to direct MMC plans to analyze gaps in quality and outcomes within their populations, as well as develop strategies to address gaps, including creating a value-based payment.

New York is one of the three states where Medicaid patients can enroll in a separate MMC plan for long-term care along with their medical care coverage, called a partial capitation plan. Many also have separate Medicare coverage. This fragmentation reduces the ability for effective, person-centered, coordinated care. Through her proposal, the Governor plans to work with MMC plans to increase the availability and adoption of integrated care options and limit non-integrated offerings.

Lastly, in New York, network adequacy requirements have not been updated in decades despite variations in health care access across the state. Network adequacy standards require that health plans meet basic standards for members’ access to in-network providers without unreasonable delay or excessive travel. Currently, consumers are often directed to unavailable or out-of-network providers, which leads to untimely care and an increased risk of incurring medical debt. The Governor’s proposal intends to instruct the Department of Health to perform a comprehensive review on network adequacy standards and increase enforcement of plan compliance. HCFANY supports the Governor’s continued investment in proposing initiatives that help protect consumers from incurring medical debt, an issue that HCFANY continues to advocate for.

HCFANY commends the Governor for introducing these initiatives to protect patients and consumers in New York. HCFANY will review the newly released Executive Budget to determine how these proposals will be implemented.

HCFANY is grateful to have had the opportunity to testify at the 2024 Joint Legislative Budget Hearing on Health. Our detailed written comments are linked here. The Executive Budget includes many positive proposals that will help protect consumers from medical debt and enhance their ability to access affordable health coverage, including:

  • Modernizing the State’s Hospital Financial Assistance Law
  • Eliminating all cost-sharing for insulin for New York State-regulated plans
  • Guaranteeing continuous health coverage for children up to 6 years of age
  • Improving subsidies and benefits for public health coverage
  • Informed consent for payment reform
  • Banning hospitals from suing patients with incomes below 400% of the federal poverty level

In addition to addressing these important reforms in the FY25 Budget, HCFANY also urges the Legislature to provide additional funding to ensure more New Yorkers can enroll in, and use their coverage, including:

  • Expanding Hospital Financial Assistance to 600% of the federal poverty level and incorporating time-limited debt repayment plans as would occur if the Ounce of Prevention Act (S1366B/A6027A) were enacted
  • Prohibiting state-operated hospitals from suing patients for medical debt by adopting the provisions of the Stop Suny Suing Bill (A8170/S7778)
  • Ensuring coverage for low-income immigrants with Section 1332 Waiver surplus pass-through funding
  • Funding Community Health Advocates at $5.5 million
  • Enhancing outreach funding for Navigators

Today, Governor Hochul delivered her 2024 ‘State of the State’ address. HCFANY commends the governor for proposing sweeping protections for consumers and patients across the state. HCFANY advocacy goals are prominently featured among the governor’s proposals, including:

Medical Debt

HCFANY commends the governor for her continued commitment to protecting the over 700,000 New Yorkers that face medical debt. Governor Hochul’s proposed legislation would bring them relief by expanding eligibility for hospital financial assistance while limiting monthly payments and the interest providers can charge on medical debt. These policies are among the protections included in the Ounce of Prevention bill (S1366A/A6027A) that HCFANY has advocated for the past couple of years. In addition, the governor announced protections for low-income New Yorkers that will prevent them from being sued for medical debt. HCFANY hopes to work with the governor on another important piece of legislation (A8170/S7778) that would prohibit the state-operated hospitals from suing patients for medical debt.

Diabetes Care

We’re pleased to see Governor Hochul recognize the need to address health care costs for New Yorkers who have diabetes, which disproportionately affects people of color and rural New Yorkers. Current state law caps co-pays for insulin at $100 per member per month. The governor’s nation-leading plan would eliminate insurance co-pays for insulin for commercial plans regulated by the state. Research indicates that the elimination of cost-sharing will increase medication adherence, leading to vastly improved health outcomes and overall health care system savings. This plan will be the most expansive insulin cost-sharing prohibition in the nation — providing relief to nearly over 500,000 New Yorkers who use insulin out of 1.6 million New Yorkers who have diabetes. According to the Hochul Administration, this proposal will save New Yorkers $14 million in 2025 alone.

Better yet, the governor has proposed to eliminate cost-sharing requirements for chronic conditions and pregnancy-related visits in both the Essential Plan and Qualified Health Plans and (covering around 1.4 million New Yorkers). With the goal of promoting better management of chronic conditions, including Type 2 Diabetes, elimination of cost sharing will allow New Yorkers to access office visits, laboratory work and testing, pharmaceuticals, and other supplies and services related to their chronic condition.

Children’s Access to Care

The governor announced that New York is submitting a waiver request to the federal government to provide continuous Medicaid and Children’s Health Insurance Program coverage for any eligible child up to six years old to ensure that no child in need misses out on critical health care services due to a lapse in health insurance coverage. Paperwork snafus would no longer result in coverage gaps. HCFANY is a proud advocate of this policy and thrilled to see the governor include improving coverage for children in her address.

Reproductive Health Care

HCFANY is enthusiastic about Governor Hochul’s proposal to expand New York State’s Paid Family Leave program to cover 40 hours of additional paid leave for pre-natal medical appointments, establishing the nation’s first statewide paid pre-natal leave benefit.

The governor will also propose legislation to enable the Commissioner of Health to issue a standing order allowing New Yorkers to access doula services without the current requirement of a recommendation from a physician.

In addition, Governor Hochul announced that she will amend the Reproductive Health Act to affirm minors’ right to receive contraceptive services and confidentially receive reproductive health care services.

Make Health Care More Affordable and Improve Access

HCFANY is thrilled that the governor announced that New York will develop state-based subsidies to ensure that Marketplace plans are more affordable—a measure that HCFANY has proposed for years.

The governor also seeks to improve access to mental health and substance use disorder care for state-regulated health plans. First, the Department of Health and the Department of Financial Services will establish a workgroup to revisit and update provider network adequacy standards. Pursuant to legislation passed last year, New York will promulgate regulations for both commercial and Medicaid insurers to strengthen network adequacy requirements for mental health and substance use disorder services. Second, Governor Hochul emphasized her commitment to improving access to mental health care offered by health insurance plans. The governor plans to improve enforcement mechanisms for mental health parity requirements, as insurance companies are legally required to provide insured individuals with access to behavioral health services that are comparable to other medical services, but too often fail to do so. To improve enforcement of parity laws, the governor proposes to fund additional staff to bring enforcement actions and introduce legislation to double fines for insurers who break the law. Further, the governor plans to increase commercial reimbursement rates for mental health services.

Unfortunately, the Governor did not include the expansion of coverage to low-income immigrants who are currently ineligible for health coverage in her State of the State address. HCFANY will continue to advocate for New York State doing so with no cost to the state using the $7.8 billion surplus that will be generated through the 1332 Waiver, pending before the federal government.