Discover Key Health Provisions in the State Fiscal 2025-26 Executive Budget: Insights from Nixon Peabody LLP

Governor Hochul recently introduced the Executive Budget for the 2025-26 fiscal year. This budget proposes $134.3 billion for the New York State Department of Health. A significant portion, $111.2 billion, is dedicated to Medicaid. There’s also $1.51 billion set aside for capital projects, marking a $9.2 billion increase from last year. If approved, this budget will bring several changes to healthcare regulations in New York.

One notable proposal is a deeper review of healthcare transactions. Following new requirements established in the 2023-24 budget, the Governor’s current budget suggests changes to the material transaction disclosure law. This would mean parties involved in healthcare transactions will need to provide more detailed information to the New York State Department of Health (NYSDOH). Importantly, even with these changes, NYSDOH approval isn’t needed to go ahead with a transaction, although they’ll have the power to conduct reviews if deemed necessary.

Currently, healthcare entities must notify NYSDOH about upcoming transactions 30 days before closing. The new proposal extends this notice period to 60 days and adds requirements for upfront disclosure of various details about the transaction, including any significant changes in service or other healthcare entities owned by the involved parties.

Another key change could impact how Medicaid operates. The budget suggests removing the “prescriber prevails” rule. This means that, starting January 1, 2026, Medicaid could have the final say on whether a prescribed drug is medically necessary, which could lead to potential savings but might also impact patient care.

Additionally, there are updates to the medical debt consent law. The Governor’s proposal seeks to clarify that patients need consent for payment distinct from treatment consent. This change focuses on non-emergency medical services. It simplifies the payment process and aims to protect patient rights.

Hospitals will also be required to report on their spending related to community benefits, detailing how these efforts align with state health priorities. This change is aimed at enhancing transparency regarding how hospitals contribute to community health and wellness.

In the realm of maternal health, new provisions will classify abortion as “protected emergency medical care.” This means hospitals are required to provide emergency abortion services when medically necessary. It would also ensure that appropriate medical protocols are followed during patient transfers between facilities.

For sexual assault survivors, hospitals must have trained personnel available 24/7, ensuring immediate medical care and support. This includes having Sexual Violence Response Coordinators and Sexual Assault Forensic Examiners on staff.

The budget will broaden the scope of practice for various healthcare providers. For example, certified medical aides could perform medication-related tasks under supervision. Additionally, experienced Physician Assistants (PAs) with extensive hours in primary care will be allowed to work independently of a supervising physician.

Pharmacists could also administer COVID-19 vaccines to younger patients, with conditions, and dental hygienists would gain new certifications that expand their practice capabilities.

A new proposal allows hospitals to deliver some services at home. This “hospital at home” model would need to follow strict discharge planning and reporting guidelines, making healthcare more accessible to patients.

Medicaid changes will include carving out long-term care services from managed care plans. There are also plans for Medicaid to cover fertility preservation services, which could assist individuals facing infertility issues.

Additionally, changes to the role of Pharmacy Benefit Managers (PBMs) will require them to be transparent about rebates and payments received from drug manufacturers. This aims to increase accountability and ultimately benefit consumers.

New York State plans to extend a cooling-off period before terminating agreements between hospitals and managed care organizations, ensuring ongoing coverage and care for patients.

Finally, New York aims to join the Nurse Licensure Compact, allowing nurses from other states to practice in New York. This could help meet healthcare needs more effectively by expanding the workforce across state lines.

These proposals reflect a significant shift in how healthcare is managed in New York. As the situation with the budget unfolds, further adjustments may emerge. It’s crucial for healthcare providers and patients to stay informed about these developments.

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