In Rare Move, New York State Comes to Puerto Rico's Aid

Facing a health-care crisis on top of financial troubles, Puerto Rico is getting help from the mainland. But why would New York come to Puerto Rico's rescue?
by | November 12, 2015
From left to right: Puerto Rico's Senate President Eduardo Bhatia, New York Gov. Andrew Cuomo, Puerto Rico's Gov. Alejandro Garcia Padilla, third left and New York City Mayor Bill de Blasio, third from right in background, march with local politicians during a protest in San Juan, Puerto Rico. (AP/Dennis M. Rivera Pichardo)

Puerto Rico is in trouble. The announcement earlier this year that the commonwealth was going bankrupt was just the beginning of doom-and-gloom headlines. It’s also facing a health-care problem that Puerto Rico Gov. Alejandro Garcia Padilla said could become a humanitarian crisis. But in a rare display of solidarity between U.S. states and territories, New York is coming to Puerto Rico's aid.

Three and a half million people live in Puerto Rico (and 1.1 million Puerto Ricans live in New York). More than 60 percent of Puerto Rico's population is on Medicaid or Medicare, but the island's troubled finances mean it may have to make big cuts to both programs. The five U.S. terrorities are exempt from Obamacare, but they do pay Medicaid taxes.

While poor states like Alabama and Mississippi get 80 percent of their Medicaid costs reimbursed, the U.S. government only pays for 15 percent of Puerto Rico's Medicaid expenses. That federal funding gap is partially why Puerto Rico is $73 billion in debt.

“We try to provide patients with the best treatments, but because of lack of funding, we do not have an adequate number of health providers and resources for the demand,” said Ricardo Rivera Cardona, executive director of the Puerto Rico Health Insurance Administration.

Thousands of residents (plus high-profile New York politicians) took to the streets in Puerto Rico last Wednesday to protest the funding disparities.

Puerto Rico is also staring down an 11 percent cut to its Medicare Advantage system next year, which could cause one million people to leave the island and devastate the already precarious economy, according to New York Medicaid Director Jason Helgerson, who is one of Governing's 2015 Public Officials of the Year.

“Those who lose their Medicaid and are sick will just end up coming to America to get care," he said. "That’ll just cost us [New York] more in the long run."

That's a big reason why New York Gov. Andrew Cuomo pledged in September to help the island’s health-care system. New York historically spent more on Medicaid than most states, but over the last few years was able to successfully drive down its spending. If Puerto Ricans continue to flock to the mainland and settle in New York, though, it would pose a gigantic burden on the state's Medicaid program.

So last month, Cuomo sent his Medicaid team to San Juan to survey the hospitals and health-care centers. What they found is a vastly underfunded system completely out of compliance with Medicaid, according to Helgerson.

“Women sit outside of hospitals and sell stocking caps," he said. "This didn’t make any sense to me because Puerto Rico is in the Caribbean. But their HVAC systems are so antiquated, it doesn’t have temperature control. So they are blasting cold air 365 days a year," ultimately driving up hospitals' energy costs.

In the past five years, Puerto Rico has lost around 5,000 physicians to the mainland. Rivera can’t blame them: The average wage for a doctor in Puerto Rico is about $65,000 a year. In Mississippi, which is the closest to Puerto Rico in terms of wealth, the average doctor earns $190,000 a year.

The island also has three times more people coming into ER than the mainland because the average wait time to see a specialist is 42 days -- more than half of the 18-day wait time in the U.S.

The loss of physicians -- and a shortage of nurses -- is so severe that there aren't enough properly trained doctors in any one hospital to care for children in intensive care units around the clock. So health workers are often forced to shuffle kids in intensive care from one hospital to another.

New York health officials -- who have made made major changes to their own health-care system recently -- hope to have a ‘transformation plan’ for the island that they can present to the federal Center for Medicare and Medicaid Services by the end of the year. Helgerson said it will focus on establishing more long-term care options and finding ways to improve the delivery system.

One of the first tasks will be to stop the exodus of health-care professionals.

“If we can help retain the nurses and primary care physicians, it will help fix the overall health-care delivery system," Helgerson said. "That in turn will help the economy overall, which is one-sixth of the economy."

In the short term, the New York team is working with Puerto Rico officials to secure $1 billion in new Medicaid money from the Obama administration.

Rivera is heartened by the alliance with New York but wants Puerto Ricans to really make their voice heard on the disparities they’ve faced for decades.

“We haven’t been dealt a fair deal by Congress, and we need to start being stubborn about it.”