The Florida Senate rejected most of an offer from the House on Friday, insisting upon aMedicaid expansion plan to help solve the imminent loss of $1.3 billion in federal health care funds for hospitals and other health care providers. House leaders have adamantly opposed expansion.
The move leaves lawmakers stuck in budget gridlock with one week remaining in the legislative session, but the House and Senate are at least exchanging budget offers – something that hadn’t happened before the House made an offer Thursday.
House Speaker Steve Crisafulli, R-Merritt Island, had previously said he didn’t support using state funds to backfill the Low Income Pool, a Medicaid program that uses local government revenues to draw down federal funds to pay for health care for the poor and uninsured. But the House offered to use $200 million in state funds to draw down $305 million in federal funds for the program.
For Senate President Andy Gardiner, R-Orlando, that’s not enough. The Orlando Health executive has repeatedly said hospitals providing care for the uninsured that often goes unpaid for will suffer if LIP funds go away or are drastically reduced by the federal government.
The Medicaid expansion plan would make up for the loss of LIP funds, Gardiner argues. The Senate’s counteroffer used $263.8 million in savings to be gleaned from health care programs run by the state made obsolete by expansion to fund an increase in K-12 education funding, a top priority of Gov. Rick Scott.
“It may be good policy and we want people to see that there are savings associated with it that can go into other areas of the budget,” Gardiner said.
Federal officials stated last year they would not extend the $2.2 billion LIP program again when it expires June 30 without significant changes. In a letter earlier this month, Center for Medicare and Medicaid Services officials made it clear Medicaid expansion was to be used to cover low-income Floridians to give them coverage for cheaper preventative care, instead of relying on LIP for to pay hospitals for more expensive emergency care.
Medicaid expansion would cover an additional 800,000 Floridians who make up to 138 percent of the federal poverty level, or $33,000 for a family of four. Gardiner’s plan, however, would require recipients to be employed or looking for work, and pay co-pays and premiums. It would also use a state-run exchange, but rely on $50 billion in federal funds for the first 10 years.
Crisafulli and House leaders continue to reject the plan as adding to a broken program with poor health outcomes, as well as padding a Medicaid budget that already makes up 30 percent of Florida’s state budget.
Both the Senate and the House are waiting on CMS officials to approve an alternative LIP program drafted by the Senate and submitted by Gov. Rick Scott’s administration on Monday. Scott said this week he waited so long to send a formal proposal because last year an informal agreement was worked out ahead of the proposal’s submission.
But Scott also recently announced his intention to sue the federal government for tying LIP funds to Medicaid expansion, calling it “coercion.”
He’s also bluntly targeting hospitals’ profits and senators’ bills and project. He summoned several senators this week to make veto threats over the budget impasse, which threatens his top legislative priorities of $673 million in tax cuts, increased K-12 education funding and frozen tuition costs.
In a memo earlier this week, Scott said he would call for a special session, a “continuation” budget and a special commission to look at the books of hospitals. He also showed senators data from Florida Agency for Health Care Administration showing hospital operating margins. Orlando Health had an operating profit of $191.8 million in 2014, and Florida Hospital had profits of $252.4 million in 2013 according to AHCA data, but hospital officials dispute those numbers.
At a gathering of health care industry representatives Friday in Orlando, executives of Orlando Health and Florida Hospital pushed back on the idea their hospitals don’t need a replacement for LIP if federal funding goes away.
Eddie Soler, executive VP and CFO at Florida Hospital, said some cuts would be forced at all hospitals if nothing is done.
“We will be okay here in Orlando, but some hospitals in Florida may be forced to close,” Soler said, citing Jackson Memorial Hospital in Miami as an example.
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