Reject PPGG Part T. Protect patient access, not health plan profits.

Independent Dispute Resolution / Medicaid Managed Care

Policy Alert — New York State Budget 2026–27

Reject PPGG Part T.
Protect patient access,
not health plan profits.

Part T of PPGG would eliminate the only neutral, binding mechanism available to resolve Medicaid Managed Care out-of-network payment disputes — producing negligible fiscal benefit while increasing risk to emergency and specialty care across New York. The math doesn’t justify it. The patients can’t afford it.

0.15%
Provider-favorable IDR outcomes as a share of total MMC claims — $33.4M of $21.9B

75.5%
Physician win rate across 7,584 MMC IDR cases resolved in one year

75%+
IDR cases involving emergency & hospital-based specialists with no choice of provider

21%
MMC’s share of all 34,596 NYS IDR initiations (Nov. 2024 – Oct. 2025)

$18B
Combined 2025 profit of UnitedHealth & Elevance, NY’s two largest MMC operators

Who Pays the Price

§ 01

Part T is being pushed by the Executive as a fiscal savings initiative. In reality, adopting this proposal will create a patient-access crisis. More than 75% of MMC IDR cases involve emergency and hospital-based specialists — neurosurgeons, anesthesiologists, trauma surgeons — physicians called in when patients have no ability to choose an in-network provider.

Across eight recent case files, plans paid an average of just 3.8% of billed charges as their initial reimbursement: $172 for a child mauled by a dog, $281 for an open chest wound, $143 for a fractured jaw.

Remove IDR and emergency specialists stop taking call for Medicaid patients. The first to lose access are rural counties already running on negative operating margins.

— NYS Comptroller, 2025 Rural Hospital Report

Part T does not save money — it shifts cost from insurer balance sheets onto patients, hospitals, and the emergency departments that absorb everyone else’s failures.

The Recourse Gap

§ 03

If MMC is removed from state IDR, those claims do not move to the federal process — CMS rules the federal IDR does not apply to Medicaid, Medicare, CHIP, or TRICARE. Internal MCO appeals make the plan its own judge; DFS appeals adjudicate coverage, not payment amount; litigation exceeds the average $6,932 award. The honest answer to “where will physicians go?” is: nowhere.

Plan-by-Plan: IDR Is a Rounding Error

§ 02

DFS FOIL data and plan claims data, Q4 2024 – Q3 2025. Provider-favorable IDR payments as a share of total Medicaid Managed Care expenditures:

Plan
MMC Paid
IDR Pro-Provider
Share

Anthem
$3.74 B
$1.96 M
0.05%

Excellus
$788.2 M
$3.11 M
0.40%

Fidelis
$6.57 B
$15.72 M
0.24%

Healthfirst
$6.54 B
$4.29 M
0.07%

MetroPlus
$2.02 B
$1.25 M
0.06%

MVP
$971.9 M
$0.26 M
0.03%

United
$5.31 B
$6.77 M
0.52%

All Plans
$21.94 B
$33.36 M
0.15%

What the IDRE Must Consider — All 7 Weighted Equally FSL § 604

Gross disparity between fees charged and fees paid by non-participating issuers in the same region
Provider’s training, education, and experience (hospitals: teaching staff, scope, case mix)
Provider’s usual charge for comparable services to non-participating-issuer patients
Circumstances and complexity — time and place of service
Individual patient characteristics
Issuer’s median in-network rate for similarly qualified providers, same region
Physician services: usual & customary cost — 80th-percentile benchmark

IDR in Practice — Eight Emergency Cases

These are not elective billing disputes. Across eight recent Medicaid Managed Care IDR cases, plans initially paid just 3.8% of what physicians billed. Independent arbitrators reviewed the medical record, coding rules, Fair Health data, provider qualifications, and clinical complexity — and sided with the providers.

$172.98 paidFidelis

Facial dog-bite injuries on a 15-year-old

Plastic surgeon called in to repair wounds and minimize permanent scarring on a teenager’s face.

$281.49 paidMolina

Open chest wound — sternal wires exposed

24-year-old woman; surgeon performed an 18 cm multi-layer closure to protect vital structures beneath.

$171.79 paidHIP

Stroke patient — multiple wrist fractures

61-year-old fell after a stroke and broke multiple bones; treated by a hand surgeon with 29 years of experience.

$498.56 paidMVP

Deep-space MRSA facial infection

27-year-old with life-threatening infection; surgeon excised infected tissue and performed full-thickness skin graft.

$1,275.24 paidMolina

Spine surgery — emergency wound closure

Bilateral muscle-flap closure over an exposed spinal column — performed twice, once on each side.

$143.81 paidHealthfirst

Fractured jaw with infected mouth lacerations

57-year-old; surgeon drained infection, debrided dead tissue, removed foreign material, irrigated the surgical site.

$472.73 paidHIP

Bone infection through hand and feet

39-year-old with osteomyelitis spreading to the index finger and feet; required two-incision drainage.

$1,303.99 paidFidelis

Dislocated knuckle requiring open surgery

60-year-old; surgeon realigned bones, repaired tendons, freed a trapped nerve, reconstructed surrounding tissue.

MCO Assertions Collapse Under Scrutiny

90%+ of the time, health plans do not engage in the required good-faith negotiation period before a provider is forced into IDR. The dispute framework exists because the negotiation framework is being ignored.

“IDR discourages network participation.”

FALSE

Physicians exit networks because of chronic underpayment, denials, and unilateral rate cuts. If plans offered fair rates, IDR would rarely be triggered. IDR volume is itself a metric of plan dysfunction.

“IDR leads to inflated payments.”

FALSE

Arbitrators rule against MCOs because initial payments are far below fair value. Decisions weigh Medicaid fee schedules, in-network rates, complexity, and training. Average favorable outcome: $6,932.

“Providers collude to inflate UCR rates.”

UNSUPPORTED

Antitrust laws prohibit coordinated pricing. UCR is derived from aggregated market data. Under FSL §604 and DFS Circular Letter 2 (2023), IDR entities weigh multiple statutory factors — UCR is one of many.

“Medicaid already has other dispute processes.”

MISLEADING

Existing appeals are controlled by plans, take months or years, and are not neutral. Internal MCO appeals make the plan judge, jury, and payor. IDR is the only independent, binding, time-limited mechanism.

“One case cost $506,097 — IDR is rife with abuse.”

CHERRY-PICKED

Cites a single orthopedic case with zero clinical context — no information on complexity, length of stay, complications, or trauma status. One anecdote does not justify dismantling a statewide framework.

“IDR weakens the contracting system.”

BACKWARDS

IDR is a neutral fallback that prevents extreme anchoring, reduces brinkmanship, and encourages in-network agreements. Without it, negotiations become coercive: “accept this rate or you will not be paid at all.”

2026 Budget · Article VII · PPGG · Part T

Reject Part T. Preserve Medicaid Managed Care
in New York’s IDR system.

Protect emergency and specialty care for the 4.7 million New Yorkers enrolled in Mainstream Medicaid Managed Care.

Vote No on Part T

Learn more at qualitycarecommission.org

Sources: DFS FOIL Data Nov. 2024 – Oct. 2025 · NYS Comptroller (2025) · CMS Applicability Guidance · SEC 10-K Filings (2025)