Albany budget bill advances with Medicaid, mental-health and Nassau University Medical Center provisions; 101-49 vote

The New York State Assembly advanced Assembly bill A.3007-c, the Health and Mental Hygiene portion of the 2025–26 state budget, after extended floor debate on Medicaid financing, mental-health reforms and a contested takeover-style restructuring of the Nassau University Medical Center (NUMC) board. The bill passed by a roll-call vote of 101 in favor and 49 opposed.

The bill packages several health-related measures into the enacted budget, including language extending the Medicaid global cap mechanics while authorizing use of managed-care organization (MCO) tax revenue to cover provider disbursements; new statutory authority for penalties against managed-care plans; changes to involuntary commitment under Kendra's Law; funding and administrative changes for the Medical Indemnity Fund (MIF); and a provision that reconstitutes NUMC's governing board and gives review authority over large contracts to the Nassau County Interim Finance Authority (NIFA).

Assemblymember Will Pretlow, the bill's sponsor on the floor, told colleagues the final financial plan was still being completed but said the bill “does not make any changes to the CDPAP nor transition to a single fiscal intermediary” and that some allocations would be published in the forthcoming scorecard. On the MCO tax, Pretlow said the bill relies in part on MCO tax revenue “to ensure that it stays in the cap.”

Why it matters: the bill affects Medicaid — one of the state’s largest budget items — safety-net hospitals, long-term-care providers and mental-health operations across New York. Several provisions create managerial or oversight changes (NUMC board restructuring, NIFA approvals), while others change statutory standards for civil commitment and add review mechanisms intended to inform policy after incidents involving use of force.

Medicaid financing and MCO tax

Members pressed the sponsor and chair on how the enacted budget will remain within the Medicaid global cap and on the risk that the federal government might not renew waivers that support collection of the MCO tax. During questioning, lawmakers cited published executive financial plans that projected cap breaches without additional measures. Pretlow and other supporters told the Assembly the enacted plan intends to use MCO tax receipts to hold spending within the cap; lawmakers were told the tax was recorded in the budget books on a three-year booking cycle but characterized as not strictly time‑limited in statute.

Lawmakers repeatedly asked whether the state would have to backfill provider allocations if federal waivers were not renewed. Pretlow said the state had “enough cash to get us through December” but acknowledged the risk that absence of a federal waiver could require alternative mechanisms or rate changes. A member cited a provider funding figure of about $3.7 billion tied to the tax during questioning.

Medical Indemnity Fund and targeted inflation

The bill includes an allocation intended to keep the Medical Indemnity Fund (MIF) solvent and reopen enrollment; Pretlow said the bill adds roughly $159 million for the fund. Lawmakers pressed about longer-term policy or administrative changes; Pretlow said no substantive procedural reforms were included in the bill text, though conversations with the commissioner would continue.

The enacted health lines include a 2.6% targeted inflationary increase for certain human services programs, a figure several members — including members who had supported a 7.8% increase in earlier one‑house budgets — criticized as insufficient. “I'm disappointed in that final number,” one member said, noting that advocates had sought a higher adjustment to reflect operating cost pressures.

Consumer-Directed Personal Assistance Program (CDPAP) and other provider questions

Lawmakers asked whether the budget delays the previously scheduled transition to a single statewide fiscal intermediary for CDPAP or adds guardrails for the transition. Pretlow said the bill “does not make any changes to the CDPAP nor transition to a single fiscal intermediary,” and that the transition remains in effect as previously enacted. Questions about timing, payment delays and fiduciary oversight were raised but not changed in the bill.

Mental health: Kendra’s Law, incident review panels and discharge planning

The budget bill contains changes to involuntary commitment standards under Kendra’s Law and requires the use of mental-health incident review panels. Sponsors and backers said the intent is to strengthen continuity of care and require more extensive discharge planning and post-discharge follow-up. Assemblymember Amy Paulin, answering floor questions, said the bill includes “an exit plan” for people who may be confined and mandates that sufficient clinical staff be available for treatment.

The bill expands the gravely disabled standard used to detain a person for psychiatric evaluation to include inability to provide food, clothing, shelter or necessary medical care, subject to clinical and judicial review processes described in debate. Members asked about the expected number of people affected; Paulin estimated the scope at roughly a thousand people per year statewide, as a ballpark figure.

Several members emphasized that involuntary measures must be paired with investments in community-based services, supportive housing and non‑police crisis response teams; sponsors said the budget includes funding for pilot programs and a behavioral health technical assistance center to curate best practices.

Nassau University Medical Center board restructuring and local pushback

A large portion of floor time focused on language in part LL of the bill that reconstitutes the NUMC board and gives the governor the authority to appoint a majority of board members and to designate the board chair, with some appointments made on recommendations of legislative leaders. The bill also authorizes NIFA oversight of contracts or obligations above specified thresholds and permits NIFA to impose a control period.

Assemblymember Steven Levine and others representing Nassau County described NUMC as a critical safety‑net hospital serving about 300,000 patients a year and employing roughly 3,600 people; they repeatedly asked whether the state takeover‑style provisions would preserve services, jobs and existing contractual obligations. Pretlow said the legislation is intended to redirect management, assist with overdue bonds and stabilize operations; he said the measure “doesn’t change” existing bond obligations but acknowledged the law will change board composition and create new oversight mechanics.

Opponents called the provision a politically driven power grab that undermines local control and warned that replacing the current board could prompt service changes or the termination of a pending lawsuit NUMC has authorized against the state. Supporters countered that NUMC has a history of financial distress, that the county refused certain state offers of financial and oversight assistance, and that stronger oversight is necessary to preserve hospital operations.

Other provisions and technical changes

The bill extends rounds 3 and 4 of the Health Care Facility Transformation program without creating new rounds, contains provisions addressing forensic examiners and timelines for DOH rulemaking, and updates reporting language on pregnancy outcomes: it replaces the statutory term “registration of fetal deaths” with “reporting of pregnancy loss,” and removes the statutory triplicate reporting requirement for induced terminations in favor of relying on established data sources, sponsors said.

Floor action and outcome

On final disposition the Assembly advanced and passed the bill. On a motion by the sponsor the clerk read the last section and recorded a roll-call vote: Ayes 101, Noes 49. The bill was enacted as part of the larger state budget process.

What to watch next

Sponsors repeatedly said key budget implementation details — such as the finalized financial plan and allocations for MCO tax disbursements to hospitals and nursing homes — will be posted in a forthcoming financial plan and scorecard. Lawmakers seeking more detail were told allocations and methodologies for individual provider pools would be made public when the administration publishes the scorecard.

Quotes

"This bill would enact into law major components of legislation that is necessary to implement the state fiscal year, 2025 through 2026 budgets as it pertains to the health and mental hygiene budget," the sponsor said during floor remarks introducing the measure.

"We're using the MCO tax revenue to ensure that it stays in the cap," a floor leader said when explaining how the enacted plan will remain within the Medicaid global cap.

"This bill does not make any changes to the CDPAP nor transition to a single fiscal intermediary," Assemblymember Paulin said on the floor when asked whether the budget delays or modifies the CDPAP transition.

Ending

The Assembly advanced the Health and Mental Hygiene portion of the budget late on the first day of floor debate; final implementation of many items will depend on the administration's published financial plan and subsequent agency rulemaking and guidance.