The controversial New York 'giveaway' in the GOP healthcare bill would shaft some Republican parts of New York
Josh Barro Don't call it a kickback. The provision slated to be added to the American Health Care Act at the behest of New York Republicans doesn't actually give anything to New York state.
It would make parts of the state significantly worse off — and not necessarily the parts you might expect.
Two likely losers under the amendment would be Suffolk and Nassau Counties on Long Island, represented by Republican Reps. Peter King and Led Zeppelin, two more moderate members of the caucus who have not yet said how they will vote.
Medicaid is usually described as a joint federal-state program, but New York has an unusual arrangement in which counties pay 13% of the bill for Medicaid.
In an effort to round up votes for the AHCA from Republican congresspeople from New York, Rep. Chris Collins (who represents the Buffalo area) won an amendment that would effectively force New York to stop sending any part of the bill to localities except New York City.
That change would save counties $2.3 billion a year, and would be especially favorable to counties in upstate New York, where most of the state's Republican members of Congress live. But New York state would have to look somewhere to replace the revenue lost from counties, and "somewhere" would probably be a tax that would fall disproportionately on taxpayers in New York City's suburbs.
Winners and losers A lot of New York voters have misconceptions about how tax revenue flows in the state. People in New York City complain that upstate is living off all the tax revenue generated by businesses and high earners in the city. Upstate residents are convinced they're paying for big, expensive social programs in New York City.
The truth is that, when New York's state government taxes and spends, upstate tends to win, while New York City comes out a little bit behind. The biggest losers — the areas with the largest gap between what they pay in state taxes and what they get back in services — tend to be the suburban counties around New York City, which have high incomes like the city but not its high appetite for social services.
Eliminating the local responsibility for Medicaid would tend to reinforce this dynamic.
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http://www.businessinsider.com/new-york-medicaid-acha-gop-health-trump-2017-3
