Author: Larry Littlefield

Tomorrow the main event of the Spitzer Administration begins: the first state budget. State government provides relatively few public services and benefits directly, but through the state budget and related rules, it finances and controls the services and benefits provided by local government and by private entities such as the health care system. For those concerned with services and benefits, and the taxes required to pay for them, the state budget is the policy. And the first state budget will be Governor Spitzer’s best opportunity to change the longstanding fiscal priorities of the state, priorities that have provided increasing rewards to a shrinking number of organized interests while disadvantaging everyone else. For the losers, including the future and those who plan to be here during it, he’s the best hope we’ve got.

Bad news has arrived from Rochester, from where the President and Chief Economist of the Center for Governmental Research e-mails that the organization has “no plans” to repeat its 1999 and 2004 analyses of the balance of state revenues and expenditures among regions of New York State. “It is rather a monumental undertaking, unfortunately.” The Center’s reports showed that even in the early 1990s, when New York City was reeling in a deep recession with one million people on welfare and substantial reductions in public services, the State of New York took much more revenue out of the city than it spent here. And later in the decade, when the city’s economy was booming but its poverty rate was still over 20% and its schools still under-funded, the State’s net redistribution of fiscal resources out of the city increased. While the Center’s reports didn’t change the fact that of other areas of the state resent, and feel free to work to the disadvantage of, the city and its people whenever possible, their inconvenient facts did somewhat diminish the 30-year river of black bile flowing our way from virtually every other part of the state. If new ones aren’t coming, those living elsewhere could be free to go back to asserting, absent evidence, that New York City residents are a bunch of undeserving freeloaders who need to be put in their place.

In my prior post, I had mentioned that although New York State’s Medicaid spending per beneficiary on nursing home services was in 2004 35% higher than the average of 38 states that have reported plus the District of Columbia, the actual difference was higher if certain anomalies are excluded. You can see this in the attached spreadsheet, which tabulates data for nursing homes by state and category of recipient. (The Datamart I provided a link to in the prior post allows all kinds of cross-tabulations). For aged beneficiaries, New York State’s nursing home spending for each beneficiary was actually 59% higher than the average of available states in 2004. In the past, when I merely tabulated the aged and (collectively) other nursing recipients, I had believed that New York State’s Medicaid spending per beneficiary on the disabled, such as the mentally retarded and ill, was low. More detailed data show that was a mistake. In reality, New York States spending per beneficiary on the disabled was 49% higher than average. The anomaly is below.

The data on Medicaid beneficiaries and expenditures by state and type of service from the federal Centers for Medicare and Medicaid Services is not out yet, and for the usual reason. Twelve of the states, including the adjacent states of Massachusetts and Pennsylvania, haven’t finished their homework and completed their quarterly data submissions for that year. Even so, with the New York State budget to be released shortly and Medicaid likely to be a big issue, I’ve decided to compile the data that is available. The attached spreadsheet was downloaded from the Medicaid Statistical Information System (MSIS) State Summary Datamart located here: http://msis.cms.hhs.gov/, with the help of the helpful Research, Statistics, Data & Systems group at that organization. The program they have set up there is so easy to use that even I can use it. Micro-data is also available for even more in depth analysis, which makes me wonder why we haven’t seen detailed analyses of our Medicaid system being undertaken and published — aside from biased reports from the health care industry itself.

The New York State Department of Labor has released Current Employment Survey data for December. And it appears that school districts in the rest of the state celebrated the Court of Appeals decision in Campaign for Fiscal Equity case, which held that New York City had been shortchanged by the state school aid formula by billions of dollars over the decades but also that the Court would allow this practice to continue without doing anything about it, in the usual way. By putting more people on the payroll to be “held harmless” later in any reorganization of the way state school aid works. From December 2005 to December 2006, local government elementary and secondary school employment rose by 2,300 in the part of New York State outside New York City, but fell by 800 in the city. During the entire 1990 to 2006 period, December public school employment is up by 9,800 in the city, a decline relative to enrollment growth, and up by 68,700 in the rest of the state. In that time, local government employment as a whole is down 18,600 in New York City but up 106,600 in the rest of the state. A spreadsheet is attached, and just for interest’s sake, and to give people some idea of the state’s priorities, I’ve included a tabulation of “shared sacrifice in tough times” that shows how local government employment changed in New York City and the rest of the state from 1994 to 1996, and from 2002 to 2004.