Four New York City home care agencies filed a federal lawsuit Wednesday in the Southern District of New York to halt upcoming changes to a Medicaid program for people who need home care, arguing the imminent cuts will impact businesses and are unconstitutional.

And recipients of the Consumer Directed Personal Assistance Program grew more anxious at a conference in Albany on Wednesday after a presentation on Pennsylvania's significant challenges when the neighboring state transitioned its program to be managed under one company.

New York's Department of Health will contract with one fiscal intermediary Oct. 1 to oversee CDPAP, which allows over 200,000 New Yorkers to choose their home caregiver, including family members, and remove more than 600 middlemen.

The four fiscal intermediaries behind the latest lawsuit — Principal Homecare, LLC;Marton Care Inc.; Prompt Home Care LLC; and Care Connect CDPAP, Inc. — join two other pending legal challenges attempting to delay the change.

"What the [New York] government has decided it is going to eliminate an entire industry, and destroy all of the 600 small businesses that currently provide these services and replace it with a single mega company," said attorney Akiva Shapiro, who represents the agencies. "...[To say] 'We're going to appoint a single state monopoly to those services' — that's completely un-American, it's unconscionable and it's unconstitutional."

Earlier in the day, presenters at the Consumer Directed Personal Assistance Association of New York State's 21st annual conference warned the Empire State's program is headed for disaster on its current timeline — worrying disabled people and aides who use the program about what's to come.

Amy Lowenstein, executive director with Pennsylvania Health Law project, went into detail about the chaos that took place in 2013 when the state's equivalent Medicaid home care program transitioned to one fiscal intermediary from 36.

She said Pennsylvania was unprepared to make the change over eight-and-a-half months, which led to delays in pay for home health aides, confusion about required paperwork and language barriers without assistance.

"This is what you don't want to happen with your transition," Lowenstein told attendees.

Pennsylvania contracted with a different FI in 2022, fixing several issues within the program, including pay delays. Pennsylvania's program served about 20,000 people in 2013, according to the Pennsylvania auditor general. Now, the program serves about 8,000 Pennsylvanians, per Pennsylvania Department of Human Services data.

But New York's program is more than 100 times larger, and state leaders expect to eliminate hundreds of FIs within six months.

"As bad as their process was, what are we in for here?" said Bryan O'Malley, executive director of the Consumer Directed Personal Assistance Association of NYS.

Officials with Gov. Kathy Hochul's office said eligibility for CDPAP will not change, and recipients will not be required to reapply to receive care under the program.

“Our reforms will strengthen CDPAP, protect home care users and ensure taxpayer dollars are effectively serving the people who need them," a spokesperson with Hochul's office said in a statement Wednesday. "Our plan does not change CDPAP eligibility for home care users and ensures that caregivers will continue receiving timely payment so they can keep providing the care that CDPAP users need."

Jose Fernandez was paralyzed from the neck down in a diving accident at age 15, and has relied on home care through CDPAP since 2006.

Fernandez, of the Bronx, said his personal assistants earn more than $20 per hour, but will see a pay cut under the program changes made in this year's budget. The state's minimum rate for home care workers is $18.55. 

"Right now, you can go work for Chipotle or Amazon and not deal with bodily fluids or helping someone with a bowel program and make the same, if not more, with a sign-on bonus," he said.

State officials have not notified New York FIs about the cuts that take effect April 1. Providers said New Yorkers who use CDPAP remain unaware of what's on the horizon.

"We're going to transition 250,000 people to one [FI] in six months? That's over 4,000 people to enroll a day," Fernandez said. " I don't see how that's possible. People are going to go without care. People are going to go without pay. People are going to end up in nursing homes."

The state's CDPAP spending is expected to exceed $9 billion this year, which Hochul has said is not sustainable and could be better spent on care.

New York state has more fiscal intermediaries than the rest of the country combined, according to the governor's office.

A coalition known as the Alliance to Protect Home Care launched a multi-million-dollar advertisement campaign this summer to fight the governor's plans to curtail CDPAP spending. Three of the seven home care companies that helped fund the campaign have been cited by the New York City comptroller for violating state labor laws and wage theft — program abuse Gov. Hochul has said will be eliminated by removing hundreds of FIs.

"Shifting from 600-plus fiscal intermediaries to a single fiscal intermediary will help the state ensure that taxpayer dollars are effectively serving the patients who need them," according to Hochul's office.

O'Malley said New York must fix fraud and issues in the program, but learn from, and not ignore, Pennsylvania's mistakes.

"Eliminate the bad actors, let the good actors remain and safeguard this program that, at the end of the day, is the least expensive way to provide long-term care services to people who need them," he said.