Mayor Bloomberg vs. Gov. Paterson in Medicaid Money Fight

December 25, 2009

Gov. Paterson and Mayor Bloomberg are showing a unified public front on the Senate health care bill, but they’re in a heated backstage battle.

The governor is steamed that the city pushed language into the Senate bill forcing the state to give it more cash – while the mayor says Paterson is cheating the city.

"They’re screwing us on [Medicaid]," one city official said.

The Bloomberg administration says the state is shortchanging the city $500million in health care stimulus money. The city sued the state over it in July.

Joined by officials from Las V egas and Los Angeles, the city last week got Senate majority Leader Harry Reid to increase state-to-local funding in the Senate bill. The state wants to strip it from the bill.

Last March, the state agreed to pass $2.7 billion of its overall health care stimulus funds to localities, with $1.92 billion earmarked for the city.

Bloomberg aides argued that typically the state bears 66% of Medicaid costs, but is hanging on to as much as 80% of the Medicaid stimulus money.

The state says a 3% cap on local spending on Medicaid growth will save the city $1.2 billion.

Bloomberg and Paterson agreed on one thing yesterday: New York needs more from the final health reform legislation.

"[The governor] and I will have to get through some tough times together,"Bloomberg said. "We won’t always agree on everything. You have a right to be wrong."