The trend of moving more patients from hospitals and nursing homes into less expensive, more effective home care treatment faces potential budget cuts in New York despite its potential to save governments millions of Medicaid dollars.

Gov. David Paterson’s budget proposal shows the extent of the fiscal crisis, where cuts are made even to a program that saves money.

Health Officials say the number of people in home care has been steady, but costs are rising rapidly because patients are getting more hours of treatment.

Paterson estimates his proposal would save the state $184 million in Medicaid costs in 2009-10. Since the federal government contributes money for Medicaid, that reduction would mean a roughly $347 million cut in federal home health funding.

(Source: NBC NY)