NYS Legislative Response to Trump Administration Cancellation of Federal Health Funds

By Mary Alice Miller
One week before the New York State April 1 budget deadline, the U.S. Dept. of Health and Human Services canceled $12 billion in COVID-19 relief federal funds allocated to states during the pandemic. The cuts complicate an already contentious budget process. State legislators will likely return to Albany to vote for a budget extender.

New York State’s share of that funding is $300 million for the state Department of Health, Office of Addiction Supports and Services, and Office of Mental Health. The funding is intended to support addiction services, mental health services, and public health programs, including COVID mitigation efforts.

Effective immediately, providers cannot access or be reimbursed for services delivered after March 24. That funding was due to expire in September.
Gov. Kathy Hochul called the cuts “devastating.”

“(This) include(s) funds that county health departments across New York are planning to use to fight disease and keep people safe. At a time when New York is facing an ongoing opioid epidemic, multiple confirmed cases of measles and an ongoing mental health crisis, these cuts will be devastating,” Hochul said.

“Make no mistake: there is no state in this country that has the financial resources to backfill the massive federal funding cuts proposed by DOGE and Congressional Republicans,” the governor added. “They are trying to rip apart the social safety net that lifts families out of poverty and gives everyone a shot at a middle-class life. These cuts aren’t just numbers on a page – they’re going to hurt real people in every corner of New York.”

“As Chair of the Senate Alcoholism and Substance Use Disorders Committee, I know these funds are lifelines for people fighting to survive. This sudden freeze threatens the progress we’ve made to prevent overdoses, support recovery, and strengthen our communities.

It also puts jobs on the line—jobs held by dedicated professionals who show up every day to save lives. In moments like this, we’re reminded that government has a responsibility to protect its people, not abandon them. We will not stand by while vital services are ripped away from those who need them most. At the very least, the state must step in with 60 days of emergency funding to protect these programs—and the jobs they sustain—while we work to resolve this emergency,” said New York State Senator Nathalia Fernandez.

“Freezing funding for recovery programs during an opioid epidemic is unconscionable,” said Senator Harckham. “These programs are lifelines to individuals struggling with Substance Use Disorder—cutting their funding will devastate thousands of New Yorkers battling addiction and mental health issues.

The Trump administration must reverse this reckless decision.”
“I join Senator Fernandez in denouncing the sudden freeze of essential grant funding for addiction, healthcare, and mental health services by the Trump administration,” said State Senator Gustavo Rivera.

“This shortsighted decision in the name of ‘cutting spending’ will significantly impact those already budget-strained providers that rely on this funding to run their life-saving programming. I am ready to push back because we cannot stand idly by while this administration slashes funding without considering the real-world consequences of those cuts.”

State Senator Jessica Ramos, a candidate for New York City mayor, and first-term Assemblyman Micah Lasher have proposed more substantive solutions to the draconian and haphazard cuts in federal funding and the reorganization of the federal workforce: the RECOURSE Act and the BRIDGE Act.

The RECOURSE Act—Reciprocal Enforcement of Claims On Unpaid or Reduced State Entitlements—would create a system for the state comptroller to report on the amount of money that the federal government owes New York, as determined by court rulings. If the report shows that the federal government withheld funds against court orders, the governor, comptroller, and budget director could withhold that amount from payments to the federal government. Their unanimous vote would trigger the Commissioner of the State Department of Taxation and Finance to withhold matching funds, securing that money for the work of state agencies providing local services.

The BRIDGE Act—Building Recruitment and Incentives for Dedicated Government Employees—would offer a pathway for fired former federal workers to join New York’s state government workforce. The bill would give them up to three years of partial credit toward their potential state pension to sweeten the deal. Still, they’d have to pay in an amount calculated by multiplying their years of federal service by a percentage of their previous year’s compensation.

The bills will “protect the workforce and ensure that New York has the tools to protect itself from Washington, D.C.’s political games,” said Ramos. “We are asking the state comptroller to carefully keep track of all of the money down to the last cent that we receive in federal funding. And if Trump dares to withhold those funds, we will withhold that same amount in federal taxes, redirecting it back to the programs and agencies that serve New Yorkers.”
“Let me be clear,” Ramos added. “New York does not bow to intimidation. We do not cower. We stand up, and we organize. We defend what’s ours.”

“Every day, the federal government takes an action that was previously unthinkable. They are using the power of the federal purse to bully institutions and individuals that they see as their ideological enemies,” said Lasher.

“It is not melodramatic, it is not hyperbolic to say this is the accelerated creep of fascism. And bending the knee is never a good strategy when dealing with fascists,” he added.
“Blue states like New York have the power to protect our people and the power to protect our state,” said Lasher. “If the federal government thinks it can cut off federal funding to New York State, they have another thing coming.”

Lasher explained that “The RECOURSE Act would ensure that New York can defend itself from the federal government when it illegally withholds funds that courts say are due to New York State. This legislation will deter bullying by Donald Trump and give the State of New York real leverage in the event of a legal fight over funding we are due.”

He said, “It also aims to make sure that we know what money is at stake by asking the state comptroller to issue a recurring report enumerating the funds due to the state and payments that we expect to make to the federal government. With this bill, New York will have greater power to claim every dollar to which our people are legally entitled.”

Lasher said the RECOURSE Act and the BRIDGE Act “are two parts of a coordinated response to a regime that is doing enormous damage and harm to our people and our values. We cannot and we will not roll out the red carpet for Donald Trump and Elon Musk. We must and we will fight back.”