ALBANY — With drug overdose deaths on the rise during the COVID-19 pandemic, the Cuomo administration quietly informed localities last week that it is sharply cutting state payments used to fund drug and alcohol treatment programs.
The sudden, 31% reduction — in payments made last week to localities that send the money to private, nonprofit treatment providers — will further strain a mental health care network struggling to provide treatment to people with drug and alcohol abuse problems.
Treatment providers say they were given no notice, and no explanation, for the surprising size of the cut or its timing by the administration of Gov. Andrew Cuomo, who has been saying for months that many recipients of state funding would face 20% cutbacks unless Washington comes through with a financial bailout package for New York.
“Programs will close. More people will die and we’re going to have a real difficult situation on our hands in communities across New York state,” said John Coppola, executive director of the New York Association of Alcoholism and Substance Abuse Providers. The group represents the range of outpatient and residential treatment programs in the state.
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“I don’t like to throw hysterical words out, but a 31% cut, I honestly don’t know how we’d figure that out when we’re already in a dire situation,” said Anne Constantino, president and CEO of Horizon Health Services, which provides addiction rehabilitation services in western New York.
Constantino said she has not yet been informed of the specific level of cuts that would affect the residential treatment at its Horizon Village. Normally, the nonprofit agency has about 200 people in its residential treatment care; that number was reduced to 70% of capacity to deal with social distancing guidance.
While Horizon has not been eligible to receive federal COVID funds available to the private sector, it has not reduced its staff because of the need to treat a rising number of addiction problems in the region.
“If it’s 31%, I can’t imagine a scenario where we can make that work,” Constantino said.
Adding to the confusion is how the money is being cut. Funding that the state sends to counties, which in turn fund local, private treatment providers, is on the 31% chopping block. It’s not yet clear is how much the state is cutting funding it provides directly to some providers, such as the state money Horizon gets for its residential treatment services.
In Warren and Washington counties, agencies aren’t cutting back on services yet, said Office of Community Services Director Rob York.
He has been quickly calling every agency to talk over the issue.
“They’re all developing various strategies. Some have seen some savings in some programs. Maybe they have a vacancy they haven’t filled. Many applied for the Paycheck Protection loan. So some of them have cash on hand from those loans,” he said.
Agencies are given an advance on their expenses each quarter. The withhold for the next quarter won’t hurt agencies immediately, he said.
“As you get toward the end of the quarter, that’s where you would see the crunch,” he said.
If the state receives federal help, state officials “hope” to restore the cuts. If that happens by the end of August, local agencies likely won’t have to reduce services, York said.
“If the funding’s not restored, it’s a different story,” he added. “We’re hopeful for the adequate federal relief so the withholds can be restored, so that critical services can continue.”
The state’s fiscal year began April 1, and few believed the 2020 budget crafted at the time by Cuomo and lawmakers was in balance. Officially, it then quickly fell out of balance as COVID spread and the economy nosedived, taking tax revenues to Albany with it.
Before April ended, Cuomo was warning of $8.2 billion that he would cut in state aid to a variety of local services, including education and a slew of health and mental health services that counties or nonprofit agencies provide on the state’s behalf.
The Cuomo administration recently reduced state funding, worth about $74 million, to a number of cities, including Buffalo. The administration defined the cuts as funding that was being “withheld” pending decisions in Washington over a stimulus package that a growing number of states say is needed to deal with the COVID economic collapse.
Congress is due back in Washington on July 20, at which time lawmakers are expected to consider a bailout package for states and localities, including public schools. New York lawmakers are also due back that day, and some legislators are pushing for a big tax hike program — aimed mostly at the wealthy and corporations — to reduce the need for spending cuts.
Cuomo is driving the fiscal train even more than other years because state lawmakers gave him extraordinary, new powers to cut the state budget this year in different phases if tax revenues did not meet previously promised spending levels.
For drug and alcohol treatment providers, the shoe dropped last week. Providers did not know how much in state aid dollars is being cut by Cuomo; all they had been told is that the funding stream to localities to pay for the services in the third quarter is dropping by 31%.
Coppola, who represents the treatment providers in Albany, said his group has been seeking to convince Cuomo’s office that addiction programs should be spared any cuts given the added demand for services during the pandemic. The providers offer treatment programs at schools and community-based agencies, outpatient offices, hospital-based and other inpatient facilities.
“The worst-case scenario has evolved in the last couple days,” Coppola said in an interview Friday.
Cuomo’s office referred questions to the administration’s Office of Addiction Services and Supports.
The agency Friday afternoon had a confusing response: It said there has been “no reduction of support for these services at this time” and then also said that “instead the state is holding back a portion of the funding as it contends with a cash crunch caused by a 14% drop in revenue due entirely to the pandemic and the federal decision to delay income tax payments by three months.”
Earlier last week, the agency sent letters to counties saying that it “expects” to restore the funding cuts “if” the federal governments provides a bailout to New York’s finances. It said it also “understands that these withholdings will necessitate difficult choices” for local services.
In its Friday response to The Buffalo News, the Cuomo agency said that “counties should equitably allocate funds to maintain vital services while the state awaits federal action.”
The agency did not provide a dollar amount that it cut in payments last week for treatment services that went out to counties for the fiscal quarter that started July 1.
The providers were already trying to figure out how to handle a 20% state funding cut that Cuomo has been suggesting would be coming to groups that rely on the “aid to localities” portion of the state budget. Coppola said the 31% cut will force programs to target staffing levels, which, in turn, will result in fewer people being able to get treatment for drug and alcohol addictions.
Most at risk, he believes, will be adolescent treatment and detox programs, which already operate in the red at many providers.
The Buffalo area is among many communities where law enforcement officials have reported a rise in overdoses, due, in part, to the isolation people have been enduring in the pandemic and sharply higher unemployment rates.
Coppola said the political dance between Cuomo and Congress over a new stimulus package has ensnared the addiction treatment providers in the form of the new funding cuts. Providers were already financially struggling before COVID, and the 31% cut will force a retrenchment in services to addicted New Yorkers, they say.
“A 31% cut is on top of years of neglect,” Coppola said of the state’s funding for the local treatment programs.
Post-Star reporter Kathleen Moore contributed to this report.