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Impact of potential federal budget cuts on NYC Health + Hospitals
1:44:04
·
5 min
Dr. Mitch Katz explains the potential impact of federal budget cuts on NYC Health + Hospitals, clarifying misconceptions about the organization's funding structure and financial situation.
- Most of H+H's funding comes from Medicaid and Medicare revenues, not direct city funding
- Potential federal cuts could result in hundreds of millions of dollars in losses for H+H services
- H+H operates with limited cash reserves (15-40 days) compared to private healthcare systems
- Any significant budget cuts would likely result in reduced services, as most of H+H's expenses are for direct patient care
Mercedes Narcisse
1:44:04
So the deadline is okay.
1:44:08
Okay moving to the federal.
1:44:13
Is a fun one for federal.
1:44:15
Federal funding makes up less than half a percent of H and H fiscal twenty twenty six preliminary budget.
1:44:22
Despite the small percentage of federal funding, does the administration foresee any financial challenges for HNH arising from potential federal budget cuts?
1:44:32
How would any reductions to Medicaid and federal dollars impact HNH budget?
Dr. Mitch Katz
1:44:38
I'm I'm so glad you asked this because it's important to clarify.
Mercedes Narcisse
1:44:42
I I guess someone gonna help us to get federal one.
1:44:44
When you Okay.
Dr. Mitch Katz
1:44:45
Okay.
1:44:46
We appreciate that.
1:44:47
But remember, when as when you're sitting as the budget committee
Kristy Marmorato
1:44:53
Mhmm.
Dr. Mitch Katz
1:44:53
You are looking at the city's budget, but most of our money is comes separate.
1:44:59
We are mostly a revenue department.
Mercedes Narcisse
1:45:01
Mhmm.
Dr. Mitch Katz
1:45:02
Right?
1:45:02
We most of our funding is not from the city, only a minority.
1:45:07
So you're not seeing any of our Medicaid revenue.
1:45:12
So we we are we receive a huge part of our budget from the federal government if you if what you define as the federal government includes Medicaid, Medicare.
1:45:23
Right?
1:45:23
I mean, there are we receive a small number of direct federal grants, and that's what you're seeing.
1:45:29
But that's not what's funding health and hospitals.
1:45:31
It's funding health and hospitals Medicaid, Medicare revenues Mhmm.
1:45:35
And other other dollars.
1:45:38
So if if we do have, you know, major cuts, and again, because there is currently no legislation, it's impossible to estimate what we could, you know, be affected by.
1:45:53
But we're certainly very, very worried given the size of the cuts that are being talked about that we could be hundreds of millions of dollars out for our services.
1:46:07
Again, the the money flows through the state.
1:46:10
So how state.
1:46:12
Yes.
Vickie Paladino
1:46:13
All feds give the state
Noelle Peñas
1:46:14
the money.
Mercedes Narcisse
1:46:15
And the money is trickled down.
Raquel Delgado
1:46:16
Yeah.
1:46:16
You're right.
Vickie Paladino
1:46:17
Mhmm.
1:46:17
And let's find out exactly what the state gives the city from the federal government.
Mercedes Narcisse
1:46:21
But the state is not getting so we we we can go back and forth, but the state is not getting too.
1:46:26
So they already have a threat.
1:46:27
We're talking about 56 points of the millionaire we already talking about.
1:46:31
Okay.
1:46:32
Colleague, yes.
1:46:34
You can advocate, but let's stay let's stay focused.
1:46:38
Let's stay focused.
1:46:39
Yeah.
1:46:39
Sorry.
Dr. Mitch Katz
1:46:40
No.
1:46:41
No.
1:46:41
So I mean, I think what you know, we will if there were these kinds of cuts Mhmm.
1:46:45
Your committee and the city council in general Mhmm.
1:46:49
You know, we will all work together to figure out how to get through it with the least harm to the people that we take care of.
1:46:56
But, again, you know, all we do is services.
Mercedes Narcisse
1:47:00
Yes.
Dr. Mitch Katz
1:47:00
We don't make anything.
1:47:01
So, you know, smaller budget means fewer services.
1:47:06
There's just no there's no way around that that possibility.
1:47:10
So I hope that the cuts are not as Deep.
1:47:13
Horrible or deep as what what people say.
1:47:16
And Mhmm.
1:47:17
Again, we do we don't you know, if you look at a private health care system Mhmm.
1:47:24
You'll find that most maintain six months of cash.
Mercedes Narcisse
1:47:29
You only have eighteen months?
Dr. Mitch Katz
1:47:30
We have fifteen days.
Mercedes Narcisse
1:47:32
Fifteen days?
Dr. Mitch Katz
1:47:32
Right.
1:47:33
And and that's okay with me because the way I view it is our patients have needs today.
Mackenzie Aranda
1:47:39
Mhmm.
Dr. Mitch Katz
1:47:39
Right?
1:47:40
We don't we're not trying to save money.
1:47:42
And as a government institution, if we save money and had to put away, the state would just give us less.
1:47:48
Mhmm.
1:47:48
They would just say you have a reserve.
1:47:49
And since the need is there, it makes sense to to meet the need.
1:47:54
But if the budget shrinks, there's just going to have to be less service.
1:47:59
There's just no there is no way around it.
1:48:02
There's nothing there's nothing that we do that is not service.
1:48:06
We don't we don't have a planning function.
1:48:08
We don't we don't produce something.
1:48:10
We're doctors, nurses, social workers.
1:48:13
We take care of people.
1:48:14
If there's less money, we're going to have to provide less care.
1:48:18
There's just no and we we also both both our salary structure is fixed by the city's union contracts.
1:48:27
And frankly, there's no great value in paying people less than the going rate because all that happens is people leave.
1:48:33
So so so you're again, when you think about it from a financial point of view, if your salary structure is fixed and all you do is service and you're gonna get hundreds of millions less, you're gonna have to provide less service.
1:48:49
There's just no no other way around it.
1:48:52
There's no other solution.
Lincoln Restler
1:48:56
Trying
Mercedes Narcisse
1:48:59
to get a question situated here.
1:49:03
So you only have eighteen days cash flow?
1:49:07
Correct.
1:49:07
How many days?
1:49:08
Eighteen?
1:49:09
Eighteen.
Dr. Mitch Katz
1:49:12
Varies by the day.
1:49:13
Every that's a that question can be answered every day.
1:49:15
Mhmm.
1:49:16
It could be different because when we get like, what's the best we've had recently, James?
James Cassidy
1:49:21
Maybe, like, forty days.
Dr. Mitch Katz
1:49:23
Forty days is, like, the best.
1:49:24
So if you get, like, a large federal check Mhmm.
1:49:28
Then at that moment
Mercedes Narcisse
1:49:28
Then your cash flows in.
Lincoln Restler
1:49:30
Okay.
Dr. Mitch Katz
1:49:32
But at other times, you can get quite low.