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New York Cuts Health Insurance Funding

Image: Vikram Vetrivel under CC 3.0

Economic programs have forced states to make painful cuts in their programs. Now, it’s New York’s turn. Governor David Paterson is one step closer to signing an emergency spending bill that severely cuts health care and health insurance spending.

By spending less on hospitals and other health-related ventures, the state also gives up some matching federal subsidies. The $775 million in cuts includes the elimination of a prescription drug program and millions in reduced funding for health care for the poor.

On a positive note for consumers, the bill also reinstates prior approval of insurers’ rate increases. That will make private coverage more affordable, saving the state $70 million that would be otherwise spent providing government-sponsored coverage for those people. New York health insurance rates are some of the highest in the nation.

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