Gov.’s revised proposal would cut health care, education less

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   Gov. David Paterson’s deficit-reduction plan has been revised to cut less from education and health care and use federal stimulus money for education that had been set aside for next year, according to his Budget Division.

   The original proposal would reduce school aid by $686 million this school year ($480 million for the state’s fiscal year, which ends March 31). School districts would lose between 3 percent and 9 percent of their state aid. The revised plan would cut $295 million ($206 through the end of the fiscal year), and districts would all lose 1.58 percent in funding.

   To make up the $391 million difference from the original plan ($274 million for this fiscal year), the state would use $391 million in federal-stimulus funds that were going to be used in 2010-11.

   In health care, the original plan would have reduced Medicaid spending by $287 million, which would have had an overall impact of about $740 million due to a loss in federal matching funds. The governor said the legislation would achieve $223 million in savings for the state and would have an overall impact on providers of $282 million.

   Some of the actions that would be needed to achieve this include eliminating 2010 inflationary increases for hospitals, nursing homes and home-care providers; lowering by 30 percent the state’s subsidy of small businesses for costs associated with mental-health parity; and authorizing nurses to increase the supply of prescription medicine for home-care patients from eight days to 15 days, thus lowering the frequency of visits.

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