The New York State budget must include increased funding for “safety-net” medical institutions currently struggling to keep their doors open.

In a conceptual budget agreement released on April 28, New York State Gov. Kathy Hochul proposed a 7.5% increase to the rates that Medicaid pays for hospital stays for the coming fiscal year.

“We’re making the largest Medicaid rate increase in two decades, investing in hospitals, nursing homes, assisted living centers, all to stabilize our state’s health care system,” Hochul said in a speech announcing the potential funding hike.

A safety-net hospital is a type of medical center in the United States that serves all individuals regardless of their insurance status. Consequently, many of these institutions cater to patients on Medicaid, a publicly-funded health insurance program which tends to pay hospitals far less than commercial insurances.

As a result, safety-net institutions are in an unfavorable financial position compared to other hospitals. And though Hochul’s conceptual budget is a step in the right direction, it fails to sufficiently patch the gap between the funding these centers receive and the amount required to continue operating successfully.

The 7.5% boost offered by Hochul falls short of the “minimum 10% increase the healthcare community was seeking and sorely needs for many institutions to remain viable,” the Greater New York Hospital Association said in a memo to members on April 28.

Other hospital groups are also pushing back, saying that the increase is largely canceled out by funding cuts that will result from the state’s recent overhaul of Medicaid pharmacy benefits.

This concern led state lawmakers to push for a proposal back in March to make targeted investments in Medicaid payments, as opposed to raising rates across the board.

The state should urgently accept such a proposal and increase Medicaid rates paid to hospitals with the highest share of Medicaid patients to ensure funding for improved infrastructure, equipment and programs related to HIV prevention and care and substance abuse treatment.

“These [safety-net hospitals] are the places that have consistently been underfunded because Medicaid rates have been garbage for a long time,” Sen. Gustavo Rivera told The Gothamist. “We are trying to get as much as we can for these institutions.”