Exclusive | NY’s powerful 1199 SEIU union already benefiting from Gov. Hochul’s allegedly rigged revamp of $11B Medicaid program: sources

Albany’s Home‑Care Shake‑Up: A Union’s Next Move

New York’s 1199 SEIU labor union, already a notable player in the state’s public‑sector bargaining arena, is beginning to press charges that Gov. Kathy Hochul’s overhaul of the $11 billion home‑care Medicaid program was unfairly tilted in favor of a private contractor, Public Partnerships LLC (PPL). The Post learned that the union is now lining up to organize the roughly 200,000 home‑health aides who work under the newly created Consumer‑Directed Personal Assistance Program (CDPAP).

The bid for a $1 billion contract to run CDPAP’s payroll was awarded to PPL after a series of meetings that, according to the union, were influenced by state officials. 1199 members have started meetings with PPL’s leadership, and the union officials say they’ll launch a formal election next year if enough aides register to vote.

"We’ve called on PPL—as we did with other companies that bid for the single fiscal intermediary contract—to stand down from pressuring their employees and instead let workers decide democratically about forming a union," Rosen Ryan, a 1199 spokesperson, said in a statement. “1199 has always been an important stakeholder in CDPAP and we will continue to work closely with them throughout the transition.”

On the other side of the story, opposition to the overhaul has grown louder. Senator Robert Jackson (D‑Manhattan) and ex‑Lt. Gov. Antonio Delgado publicly criticized the reform during a press conference held by the advocacy group New York Caring Majority. Jackson warned that “as federal cuts threaten to unravel Medicaid’s foundation, every public dollar must be protected and directed—toward people, not profit.” Delgado echoed those concerns, calling the legislation “a bureaucratic mistake.”

The controversy stems partly from the way COVID‑19‑era staffing costs ballooned. In 2018, the program cost about $3 billion; by 2021 it had risen toward $11 billion, sparking Hochul’s desire to slash waste and fraud. The re‑design consolidated hundreds of middle‑men firms—fiscal intermediaries that processed Medicaid checks for aides—into a single, state‑selected entity.

But that single entity, PPL, is now being accused of raising rates without clear justification. An email traced by the government watchdog Empire Center for Public Policy shows that officials from the governor’s office and the Department of Health met with PPL representatives on April 4, weeks before the legislature approved the contract. PPL explained their higher cost by citing a statutory jump of 55 cents in the minimum wage for home‑care workers that will take effect in 2026. In a statement, a PPL spokesperson said, “PPL retains nothing from the increase and every added dollar goes directly to worker pay. This adjustment does not violate PPL’s contract.”

The Health Plans Association—representing insurers that front payroll money to PPL—threatened that “if PPL insists on its one‑size‑fits‑all, non‑negotiable rate, it will put at risk services to members and will undoubtedly undermine the very financial savings that the State projected.”

While the governor’s office remained tight‑lipped on the rate hikes and the April 4 meeting, many lawmakers now see the reforms as a costly gamble. Nearly 80 000 consumers reportedly left CDPAP for alternate home‑care programs, which are typically more expensive. Michael Kinnucan, Health Policy Director at the Fiscal Policy Institute, told The Post that “this transition caused many tens of thousands of consumers to switch to agency care, which is a more expensive form of care. Some of the savings is illusory.”

Despite the backlash, Hochul has defended the changes as a win, projecting a $1 billion annual savings split evenly between state and federal funds. “It made sense. It was a war, was a major fight, and those are the kind of issues I’m willing to take on,” she said at a recent press briefing.

Now, with the union’s unionization drive gaining momentum and the public increasingly skeptical of the procurement process, New York’s home‑care system is at a tipping point. Whether the new structure delivers on its promises—or becomes yet another costly experiment—remains to be seen.

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