The number of people depending on Medicaid in Florida has increased by 20% since the start of the pandemic. Medicaid is the state and federal program that provides insurance for the lowest income Americans. Right as costs for the program have increased, state revenues have taken a hit. Now, as lawmakers prepare to hammer out a budget this legislative session, healthcare cuts could be part of that discussion.
Florida lawmakers are facing a $2-billion budget shortfall. When it comes to filling that gap, Senate President Wilton Simpson says “everything is on the table,” including potential cuts to the payments hospitals get for caring for low income patients through the Medicaid program.
“Once we know what all of the opportunities are we’ll be better able to assemble those pieces to see if any cuts will be necessary,” Simpson says.
House Speaker Chris Sprowls agrees healthcare decisions will have to be part of a larger discussion about the state budget as a whole. But He says he also recognizes the important role hospitals and medical workers have played during the pandemic.
“We want to be super sensitive to the fact that healthcare has carried the brunt, a lot of the brunt, that’s been happening. They’ve had to adapt considerably during this period of time to give us what we need including to make sure there’s bed space and adequate personnel that were employed. So we want to be really, really sensitive to that. What’s also worth considering is that there has been an influx in federal money,” Sprowls says.
The federal government has increased the share of Medicaid payments it covers. That has helped make up for the rise in enrollment over the past year and experts say that increased funding is expected to stay in place through the calendar year.
“We would more than anything just like to buy time,” says Florida Safety Net Hospital Alliance CEO Justin Senior. “To see what next year looks like. To see if the economy can make a bounce back before somebody imposes cuts that will just have a nasty negative impact after a difficult year for healthcare workers where they did an extraordinary job.”
Senior says by the end of the calendar year when the federal share of Medicaid payments returns to normal, the economy is likely to have improved. That means two things—state revenue will pick back up and fewer people will be depending on Medicaid because they’ll be back in jobs. He says that could mean there’s no need for cuts. He also points out if lawmakers are looking for a way to save money in a tight budget year, Medicaid isn’t typically the best say to get the most bang for your buck. That’s because Medicaid is a matching program, but its not a 50/50 split. The federal government’s portion is much larger.
“So when you try to go in and cut Medicaid dollars and you think ‘well I need to find a few hundred million dollars in general revenue in savings,’ often you have to cut a billion dollars or more from the Medicaid program to find that much general revenue. So you end up having a pretty outsize impact with the cuts and probably a little more impact than you intended as a budget-maker,” Senior says.
Senior is a former head of the Agency for Healthcare Administration and Florida Medicaid director. He says he understands why lawmakers might need to look at Medicaid cuts as they consider the budget. Along with Education, Healthcare makes up one of the biggest chunks of the state’s spending plan. But he says he’s hopeful cuts won’t be needed. He says it would a tough blow to medical workers who have already had a tough year.
