Florida Lawmakers Propose Medicaid Budget Cuts

Mar 28, 2017

The Florida House and Senate are planning big cuts to Florida hospitals and those groups say it will hurt medical care access for the poor and disabled.

Edgewater resident Adrienne Gorham works as sign language interpreter. She said she makes too much for Medicaid. That’s one reason she’s deep in debt on medical bills she can’t pay after a car accident two years ago.

Many Florida hospitals serve people who are uninsured or on Medicaid. They get reimbursed in a variety of ways, including a base rate reimbursement, Medicaid enhancement payments and help absorbing uncompensated care. The state and federal government pay a certain rate for services for people on Medicaid, but it’s less than the actual cost of services. Bruce Rueben of the Florida Hospital Association said that reimbursement rate could be much lower next year under the proposed House budget.

“It’s a big story to see a state contemplate these kinds of really draconian cuts in the House budget,” he said.

The Florida House is proposing cutting the base Medicaid rate by 7 percent, Which means Florida hospitals will get paid less for patients on Medicaid. They’ll also get less federal matching funds, so hospitals may see a $622 million loss next year. Rueben says that could force hospitals to offer fewer services or pass more of the cost onto people with private insurance.

The Senate isn’t proposing a rate reduction, but it is considering cutting Medicaid supplemental payments by $99 million or a $258 million loss with a federal match.

The House also wants to trim $477 million in supplemental payments to hospitals. House Appropriations Chairman Jason Brodeur said he wants to “glide” down the payments hospital get beyond the rates.

“Nobody’s payment rate could go above 5 percent or below 5 percent of what they got so it smoothes it out over time," he said. "What we don’t want to have happen is implement a policy and then have either the bottom fall out or somebody get an enormous amount of money for no difference in effort.”

But Senate Appropriation Chairwoman Antiere Flores said hospitals still end up ahead.

“We could really see it as - it’s an increase," she said. "So yeah, that’s the way the math works. Ready? I’m going to blow your mind here. Are you ready?”

Hospitals will come out ahead in the Senate’s budget, said Flores, because it still counts low-income pool money, also known as LIP. LIP is made up of local government and federal matching dollars to cover the expenses of hospitals who care for the uninsured.

President Barack Obama’s Administration’s eliminated the LIP pool because it wanted Florida to expand Medicaid to cover the uninsured “charity care.” Flores says they’ve been talking to President Donald Trump’s Administration about returning about $600 million the money to the state for this budget year. The House’s budget doesn’t include LIP funding.

Rueben said some hospitals will be hurt if the legislature cuts Medicaid funding. But he said he worries more about cuts to medical access to the poor and disabled. Especially in a state that has more money than it spends.

“There’s no critical need to make these kinds of cuts," he said. "It’s just something they decided to do.”

Rueben said more people on private pay will pick the cost of the budget cuts. He said it amounts to a hidden tax. Florida’s Health and Human Services budget makes up about a third of the state’s $82 billion budget.