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Drug prices, executive power, Medicaid payments among hearing topics ⋆ Epeak . Independent news and blogs

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Drug price controls, expanding the power of the Health Department to act unilaterally and the adequacy of Medicaid payments were among the topics at the start of what is likely to be a lengthy state legislative hearing Thursday on the Cuomo administration’s proposed budget for health and Medicaid.

An underlying theme was uncertainty about what action the Trump administration and a Republican-led Congress might take on such issues as the Affordable Care Act, which could affect health insurance subsidies for New Yorkers, and funding for women’s reproductive health clinics, including Planned Parenthood.

“Much is happening in Washington,” state Health Commissioner Howard Zucker told lawmakers. “If the A.C.A. were repealed, that would be a major concern, with millions of people potentially losing health care.”

The 2017-18 state spending plan calls for a 3.2 percent rise in spending on Medicaid to over $65 billion; a 10 percent hike in non-Medicaid state Health Department spending to almost $4.8 billion; and a 13.2 percent increase in funding (to $4.2 billion) to subsidize health insurance coverage for New Yorkers whose income puts them just over the Medicaid eligibility limits.

At a time of skyrocketing prices for a small range of pharmaceuticals, the governor’s plan calls for the state to cap prices on some drugs and impose a surcharge on drugmakers who exceed it.

Assemblyman Richard Gottfried, a Manhattan Democrat, expressed frustration over a lack of detailed information from the Health Department on how the plan would work.

Saying an analysis would be forthcoming, state Medicaid Director Jason Helgerson said the plan would focus on drugmakers that take advantage of a lack of competition afforded by initial patent protections to place exorbitant prices on life-saving or life-changing drugs. Pricey drugs for hepatitis C, which cost about $90,000 for a full treatment, have created significant challenges for the Medicaid program, he said.

Gottfried wondered if it would make sense for the price-control plan to include more drugs, such as commonly prescribed antibiotics. Helgerson said that was not how the program was conceived. Health officials see the plan as a deterrent that will prevent bad actors from overpricing, he said.

“Our goal with this proposal is not to put any manufacturer in the penalty box,” Helgerson said. “Our goal is they change behavior.”

Health officials said they were confident the plan would withstand legal scrutiny. The pharmaceutical lobby this week questioned whether the proposal was legal, saying a federal court struck down a similar law in Washington, D.C.

Several lawmakers made clear their distaste for a proposal that would give the Health Department the power to act quickly,without legislative approval, in a fiscal “emergency,” such as if the federal government abruptly cut off Medicaid funds. Long Island Republican Kemp Hannon, chair of the Senate Health Committee, called the proposal “an extraordinary request for powers that have hitherto not been seen with the executive.”

The intent, Helgerson explained, is to be able to preserve programs that are in place, not to create new initiatives without legislative approval. Sen. Gustavo Rivera, a Democrat from the Bronx, pushed back over the language of the proposal, telling health officials it was “broad enough for you to make these decisions without coming back to us.”

Later, lawmakers questioned Department of Financial Services Superintendent Maria Vullo over her dispute with Eric Schneiderman on a similar issue. The state attorney general claims Cuomo’s proposals would expand the DFS superintendent’s powers in a “wholly unnecessary overreach.” Vullo claimed the proposal would merely update the law to give her authority over all the entities the department has overseen since 2011, whether banking or insurance.

Lawmakers also questioned the continued value of a cap on state Medicaid spending. Helgerson defended the cap as a tool that has helped officials keep a tight rein on expenses.

Sen. Diane Savino, a Staten Island Democrat, said one place the cap has created problems is in Medicaid payments for ambulance services, which have not seen increases since 2008. Sprinkled throughout the hearing audience were EMS staff in white uniforms.

“We will be losing people,” Savino said about emergency responders. “We will be losing them to fast food work.”



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