ALBANY, N.Y.—Under a proposal to overhaul New York's safety net financing, the state would contract with accountable care organizations or health plans for seniors who are eligible for both Medicare and Medicaid.

The proposal would affect roughly 700,000 New York seniors and would require a waiver from the CMS, said a work group that released its proposals for the state's ongoing task force to redesign Medicaid.

Under the waiver, New York would assume financing and healthcare delivery risk for so-called dual-eligibles and reach capitation or sub-capitation agreements with health plans and providers, the report said. Medicaid and Medicare spending for the state's jointly enrolled seniors totaled about $23.5 billion and $11.3 billion, respectively, in 2010. The waiver could promote development of ACOs and patient-centered medical homes, but New York could also be left with losses should providers fail to curb spending, the report said. The report also recommended expansion of the state's Medicaid quality measures from managed care to fee for service. The state would start quality reporting for mental health and substance abuse in 2012 and expand it further in 2013-14. Home health would report quality measures in 2012-13, when long-term-care quality measures would also expand, the report said. Under another proposal, the state would also offer limited financial support to hospitals, nursing homes and home health providers deemed essential to offset costs of closures, mergers or integration or redesign of services. Such financing could help with proposals made to the task force for the reconfiguration of Brooklyn's hospital market (Dec. 5).

AUGUSTA, Maine—Gov. Paul LePage is proposing tougher Medicaid eligibility standards and a new benefit structure as part of his plan to balance a yawning shortfall in the program. In a news conference Dec. 6, LePage said an analysis of fiscal 2012, which ends next June, shows a shortfall of $120 million. The shortfall for fiscal 2013 is an additional $100 million. The governor says Maine's Medicaid program is one of the most generous in the country and has grown beyond the state's means. He says eligibility must be restructured, benefits redesigned and payment reforms put in place to restore Medicaid to financial accountability. The governor presented his Medicaid restructuring plan to key legislative Democrats and Republicans on Dec. 6. His proposed changes must be approved by the Legislature.

FREEHOLD, N.J.—CentraState Healthcare System, based in Freehold, became the latest investor in QualCare, a provider-owned managed care company. News that CentraState joined more than a dozen owners in the New Jersey health plan follows the November announcement that Atlantic Health System, Morristown, N.J., had invested in QualCare. CentraState's stake in QualCare brings the total number of hospital and physician organization owners in the managed-care company to 15, according to a news release announcing the deal. QualCare includes 750,000 members covered by self-insured health and workers' compensation and liability insurance, the release said.

Ashton will lead planning of hospital's replacement facility.

MILFORD, Del.—Bayhealth Medical Center, a 328-bed hospital in Dover, Del., hired Michael Ashton as administrator of Milford Memorial Hospital, a newly created position in which Ashton is expected to lead the planning and construction of a replacement facility. Ashton, 36, most recently was administrative director of the medical service line for WellSpan Health, a two-hospital system in York, Pa., according to a Bayhealth news release. Milford Memorial, a campus of Bayhealth, plans to begin construction by 2014 on the replacement hospital at the same site in order to allow phased construction and take advantage of existing infrastructure and parking. Officials expect construction to take two years. Ashton also has responsibility for the 37-bed inpatient rehabilitation unit and home health services.