Is Universal Health Care On NY's Horizon?

This month, advocates for single-payer healthcare in New York reached a milestone: for the first time ever, majorities in both chambers of the state legislature co-sponsored the New York Health Act.

The legislation, which would create a far-reaching single-payer healthcare program for all New Yorkers, has languished in the State Senate for years.

Until 2019, Republicans controlled the upper chamber, blocking a bill that had passed the Democrat-dominated Assembly five times.

In 2019 and 2020, with Democrats in control of the Senate, the bill was very close to winning majority support. After the elections last fall, with a surge turnout for Joe Biden and against Donald Trump powering Democratic candidates across the state, Senate Democrats won a veto-proof supermajority.

Three freshmen Senate Democrats—Michelle Hinchey, Jeremy Cooney, and Samra Brouk—are now co-sponsors of the New York Health Act, bringing the number of backers to 33, one beyond the 32 needed for passage.

“We’re certainly going to work to move it this year,” said State Senator Gustavo Rivera, the Bronx Democrat who is the lead co-sponsor of the legislation. “It’s not going to pass tomorrow, I’d say—we still gotta deal with this knucklehead.”

“This knucklehead,” in Rivera’s view, is Andrew Cuomo, the scandal-plagued governor. At least a half dozen women have accused Cuomo of sexual misconduct, and the FBI is currently investigating his handling of nursing home data during the COVID-19 pandemic.

The state Attorney General, Letitia James, deputized investigators to probe the harassment claims, and the State Assembly launched an impeachment inquiry. Much of the state’s Democratic establishment, including Rivera, has called for Cuomo to resign. Amid dropping poll numbers, Cuomo has repeatedly refused while denying at least some of the allegations, as well as their severity.

All of this has upended how Albany usually does business. Rivera, in speaking with Gothamist, repeatedly said he looked forward to working with “Governor Hochul” on the New York Health Act, a reference to the understated lieutenant governor, Kathy Hochul, who would become governor in the event Cuomo steps down or is removed from office.

Cuomo has never been a supporter of the bill, preferring that universal healthcare is achieved on the federal level. The Greater New York Hospital Association, the powerful umbrella organization representing more than 200 hospitals across the state, has been opposed as well.

GNYHA and Cuomo enjoy an unusually close relationship, with hospital executives and lobbyists shaping much of the state’s pandemic response.

Any movement on the healthcare legislation this year would come after the budget is due on April 1st. Supporters say the pandemic, which has thrown out-of-work New Yorkers off their employer-backed health insurance plans and threatened funding for public hospitals, demonstrates just how necessary single-payer in New York would be.

“We’re working with legislators to highlight all the different ways the New York Health Act would address healthcare inequity throughout the state,” said Ursula Rozum, the co-director of the Campaign for New York Health, the advocacy organization fighting for the bill.

The legislation has many prominent backers, including major labor unions like 1199 SEIU, the healthcare workers union, and the New York State Nurses Association. At its core, it would create a single government-run health insurance program for New York and cover, free of charge, all state residents for various medical needs, including long term care. It would eliminate private health insurance.

Though New York’s uninsured rate is quite low, many low-income and middle-income New Yorkers struggle with high out-of-pocket costs and deductibles. For those without generous private plans or public sector benefits, a state-run plan would likely offer more comprehensive and cheaper coverage.

Still, no state in America operates a single-payer program. Vermont, much smaller and less wealthy than New York, tried and failed to implement one last decade.

Many opponents, and even some supporters, have balked at the New York Health Act’s upfront costs: the program would need $139 billion in new tax revenue, 156 percent more than the state currently collects, according to a RAND Corporation study. The single-payer program would create dramatically lower administrative costs, though this wouldn’t offset the need for new taxes.

“Even if you take for granted that the new system can cover more people and more benefits with fewer restraints at roughly the same cost as the status quo, which is dubious in the extreme, this proposal would put the entire $300 billion health system on the New York's balance sheet—making the rest of state government look small by comparison,” said Bill Hammond, the senior fellow for health policy at the Empire Center, a right-leaning think tank.

Hammond, a fierce opponent of the legislation, argued that “figuring out how to balance the budget of this one program—by cutting costs, raising revenue or both—would become Albany's dominant obsession.”

Healthcare costs continue to rise in the state. Before the pandemic, rising Medicaid costs threatened to blow a $6 billion hole in the budget. New taxes could offset this burden, but Cuomo has not embraced the idea of tax hikes to offset coronavirus-induced shortfalls, let alone building an entirely new healthcare system.

Municipal unions, which collectively bargain for their own general healthcare benefits, have also been wary of the New York Health Act, concerned that the single-payer program would not match their own, though backers like Richard Gottfried, the assemblyman who is the architect of the proposed program, believes the government-run plan will be much better.

“We would have the bargaining clout by bargaining on behalf of 20 million customers to dramatically knock down drug company prices,” Gottfried said. “What is too expensive is the current system and people should be asking how can we pay for the current system.”

Though both Gottfried and Rivera are optimistic the legislation could move this year, a floor vote on the New York Health Act for both chambers is not necessarily likely in the near future. One high-ranking State Senate source said it would be hard to address the legislation outside the window of hashing out the state budget—which is happening currently—because it would so dramatically reimagine the fiscal nature of the state. Since the budget is almost done now, it’s possible that single-payer becomes more of a 2022 priority, rather than one for this year.

Overcoming the hospital and health insurance lobbies will likely be the biggest challenge for single-payer advocates. Banning private health insurance in one of the nation’s largest markets would be a major blow to insurance companies.

And hospitals, particularly large private networks that are used to higher reimbursement rates from well-heeled patients, are worried about the disruption a new healthcare system would bring.

“The legislation would place extreme downward pressure on already-inadequate hospital payments, endangering the survival of hospitals,” said GNYHA, the hospital lobby, in a memo to the legislature opposing the New York Health Act. “Current Medicaid rates fall far short of covering hospital costs; sadly, this is the history of government-run insurance programs and a major reason why safety net hospitals struggle to keep their doors open. GNYHA is concerned that when facing economic stress, the state would look to achieve savings by cutting NYHA, which would be the largest single state program if enacted.”

A spokesperson for Cuomo did not return a request for comment.